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Govt to create database to check terror funding

March 07, 2010 20:22 IST

The government has decided to set up a 'centralised database' to check terror funding by integrating intelligence from different central security agencies.

Sources in the Union home ministry said the proposed database would act as a "ready reckoner" for different security and law and order enforcement agencies to check illegal routing of money through various financial channels meant to further organised crime and support anti-national activities.

They said the databank would be created to detect illegal money movement within and outside the country and among particular groups or institutions by means of banks or other intermediaries.

There is no such consolidated data bank for collecting and disseminating intelligence, which, at times, creates problem for the government to trace and later stop terror funding.

The data bank would be created by the Financial Intelligence Unit-India -- a central national agency responsible for receiving, processing, analysing and disseminating information relating to suspect financial transactions.

A senior Home Ministry official said, "The government proposes to set up a centralised database by integrating the intelligence output relating to terror or terror funding of various agencies under the Union government."

According to a finance ministry report, the FIU has detected over 4,000 suspicious transactions relating to crime and terror in 2009 besides more than 35,000 cases of counterfeit currency through banking channels.

Out of the total of 4,409 suspicious transactions, 2,826 were reported by banks, 841 by financial institutions and 742 by intermediaries taking the number to more than double of 1,916 transactions reported in 2008.

The instances of fake currency received by various categories of banks also rose to more than four times as 35,730 reports were registered and sent to the government.

During 2007-08, such reports were a mere 8,580.

In an effort to identify patterns of money laundering, terrorist financing and other economic crimes, the government also scanned 55,11,150 cash transactions containing at least Rs 55,111.5 crore in them.

The government also received 69 requests of information from foreign financial intelligence units while it sent 17 such requests to other countries, it said.

Various enforcement agencies like the Central Board of Direct Taxes, Central Board of Excise and Customs, Narcotics Control Bureau, Central Bureau of Investigation, Intelligence Bureau and the Enforcement Directorate were sent 2,450 Suspicious Transaction Reports for necessary action by the FIU during 2009.

The STRs included details of all accounts, transactions, individuals and legal entities related.
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