New Delhi: The country’s elite financial intelligence agency— FIU — is grappling with a “serious” problem of manpower shortage that may jeopardise India’s global review next year for undertaking adequate anti-money laundering and tax crime combat measures, official records show.
What may further impact India’s case in the year 2020 is the fact that the Financial Intelligence Unit (FIU) is facing this shortage of specialised analysts and investigators for over a decade now.
The FIU is the national agency to collect, analyse and disseminate instances of serious tax crimes like tax evasion, money laundering, terror financing and detection of counterfeit currency in country’s economic channels.
An official communication accessed by PTI said the FIU has since been “making up the shortfall” in the number of staffers by hiring varying number personnel on contract basis every year.
“Despite serious challenges, most notably shortage of staff, officers and staff of the FIU have continued to work with dedication to serve the nation,” the FIU said in a recent report submitted to the Union Finance Ministry that exercises superintendence over it.
It received a record 14 lakh suspicious transaction reports (STRs), a record 1,400 per cent jump over the past, during 2017-18.
Officials in the Finance Ministry told the news agency that the counter-terror financing and anti-money laundering regime of the country is set for a global review early next year and a perennial shortage of the vital manpower component in FIU’s organisation is expected to invite “adverse remarks” that may jeopardise its standing as an effective and resolute nation against tax crime instances and perpetrators.
The review will be conducted by the international body, the Financial Action Task Force (FATF).
As per official data, the agency has been functioning on less than half its sanctioned strength of 75 in the latest recorded year of 2017-18 and the trend trails back up to the year 2011-12. The actual working strength of the agency varied between 31 and 36 in these years while over two dozen experts were brought on “contract” to make up the shortfall.
Between the years 2010-11 and 2009-10, FIUs sanctioned strength was 74 and it only had 45 and 36 staffers respectively.
During the years of 2008-09 and 2007-08, the agency was given a 43 member staff strength and it worked with only 30 and 32 investigators respectively, the data revealed.
The FIU was set up in March, 2005 by the Union government as part of India’s global commitment against terrorist financing and money laundering crimes that criss-cross shores.
2006-07 was its first year of operations when it began gathering STRs from banks and other financial institutions as part of its mandate under the Prevention of Money Laundering (PMLA).
The agency’s official charter says it is an “officer-oriented and technology intensive organisation” and functions as a multi-disciplinary unit of officers who have done stints in streams like direct taxes management, banking, terror financing analysis, share market experts and complex accounting.
Officials confirmed that the government and the Finance Ministry has been made aware about the “long-drawn issue that requires urgent attention”, a number of times.
A proposal to grant 20 per cent special monetary allowance to the elite workforce of the FIU is also pending for over three years now, they said.
Officials and investigators of the CBI and the Enforcement Directorate (ED) get this special incentive allowance at the rate of 20 per cent of the basic pay, they said.
The maximum vacancies are in the ranks of Deputy and Assistant Directors, the cutting-edge of FIU investigations, and lack of incentives despite doing a heavy data crunching job is probably the reason not many bright officers pick up a deputation posting in the FIU, the officials said.
India cannot afford to ignore these concerns as the recent United Nations Security Council resolution asks nations “to establish operationally independent and autonomous financial intelligence units with a view to strengthen their framework to prevent and counter the financing of terrorism, in line with FATF standards”, a senior official said.—PTI