Anti-money laundering: Govt forms separate dept

The government on Wednesday decided to set up a separate department to look after money laundering under the finance ministry.

The government’s move is aimed at preventing any possible action by the Financial Action Task Force (FATF), a global anti-money laundering body.

FATF’s annual meeting to be held from June 23 to 25 in Mexico is crucial as it could blacklist Nepal for not being able to honour its international commitments on AML. Nepal is under international scrutiny for its ‘failure’ to live up to its AML commitments.

The latest government move is surprising as the ministry had earlier planned to convert the Department of Revenue Investigation (DRI) into Revenue Investigation and Money Laundering Control Department. However, the ministry on Tuesday initiated a process for a separate department.

“This is perhaps the first instance of formation of a new department within two days,” said a senior MoF official.

The finance ministry had sent the proposal of forming a separate department on AML to the Ministry of General Administration (MoGA) on Wednesday morning. And, MoGA endorsed the proposal without any delay. With this, there will be four departments under the finance ministry—Customs Department, Inland Revenue Department, Department of Revenue Investigation and Department of Anti-Money Laundering.

According to finance ministry sources, the decision to form a separate department on AML was taken as the country is currently not in a position to endorse bills and UN conventions on AML. “With the formation of a separate department, the finance secretary and the central bank governor can defend Nepal at the FATF meeting,” said a ministry official. The Parliament had endorsed the Anti-Money Laundering Act (First Amendment) on May 25.

According to the finance ministry, of the 200 staffers at DRI, 37 will be assigned at the new department.

The department will be headed by a joint-secretary with four under secretaries and six section officers.

Posted on: 2011-06-16 08:28

http://www.ekantipur.com/2011/06/16/business/anti-money-laundering-govt-forms-separate-dept/335784.html