New Delhi [India], January 18 : The Financial Intelligence Unit (FIU-IND) and the National Housing Bank (NHB) on Saturday signed a Memorandum of Understanding (MoU) as part of continued coordinated efforts in effective implementation of requirements of the Prevention of Money Laundering Act and Rules framed thereunder in New Delhi.
According to a Ministry of Finance release, the MoU was signed by Vivek Aggarwal, Director, FIU-IND and Sanjay Shukla, Managing Director, NHB.
As part of the agreement, each Party to the MoU will appoint a nodal officer and an alternate nodal officer to interact with the other party.
The MoU outlines a framework for cooperation on anti-money laundering and counter Financing of Terrorism (CFT) activities, with a focus on the housing finance sector in India.
Under the mamorandum, each party will appoint a primary and an alternate nodal officer. These officers will serve as the main points of contact for facilitating communication and collaboration between the two entities.
The MoU outlines the procedures through which supervised entities, such as housing finance companies, report to FIU-IND under the Prevention of Money Laundering Act (PMLA) rules. This ensures that the reporting process is clear and standardised.
The MoU emphasises conducting outreach programs and training sessions for supervised entities or reporting entities. The objective is to enhance their understanding of AML/CFT regulations and improve compliance.
Both parties will work towards strengthening the AML/CFT capabilities of supervised entities, equipping them with the skills and knowledge to combat money laundering and terrorism financing effectively.
The MoU includes provisions for assessing the AML/CFT risks and vulnerabilities within Housing Finance Companies in India. This is a critical step in understanding and mitigating potential threats in the sector.
It emphasises the identification of red flags that can help in spotting suspicious transactions within the housing finance sector, ensuring early detection of financial crimes.
Both FIU-IND and NHB will monitor the compliance of housing finance companies with their legal obligations under the PMLA, PML rules, and the guidelines set by the Reserve Bank of India (RBI) and NHB itself.
According to the ministry, both parties commit to ensuring compliance with relevant international AML/CFT standards, further aligning India's practices with global norms.
Regular quarterly meetings will be held to review progress, discuss trends in financial crimes (particularly related to AML/CFT), and evaluate cases where sanctions or penalties have been imposed. These meetings will also allow the parties to share information on typologies and trends emerging in the field of AML/CFT.
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