Discuss how emerging technologies and globalisation contribute to money laundering. Elaborate measures to tackle the problem of money laundering both at national and international levels.
Globalisation and emerging technologies have created new, sophisticated avenues for money laundering, making it harder to track illicit funds.
Technologies like cryptocurrencies and the dark web offer anonymity, allowing criminals to move large sums across borders instantly with little oversight. Globalisation facilitates this through a web of shell companies registered in tax havens and complex international financial systems, making it easy to obscure the money trail through layering.
Measures to tackle this are multi-pronged:
- National Level: India has enacted the Prevention of Money Laundering Act (PMLA) and established the Financial Intelligence Unit (FIU-IND) to monitor suspicious transactions. Strict Know Your Customer (KYC) norms for financial institutions are a critical defensive line.
- International Level: The Financial Action Task Force (FATF) sets global standards and assesses countries' anti-money laundering frameworks. International cooperation through Mutual Legal Assistance Treaties (MLATs) and information-sharing agreements are crucial for tracking cross-border financial crimes.
Answered By:
Sakshi Negi
Sakshi Negi is a Delhi-based journalist and content specialist with expertise in educational content and digital media, focusing particularly on government exam preparation and career guidance. With a degree in Journalism and Mass Communication from NRAI School of Mass Communication and her background as a Kendriya Vidyalaya alumna, she brings unique insights into the Indian education system and government sector opportunities.
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Important Questions from GS3
Examine the pattern and trend of public expenditure on social services in the post-reforms period in India. To what extent this has been in consonance with achieving the objective of inclusive growth?
What are the causes of persistent high food inflation in India? Comment on the effectiveness of the monetary policy of the RBI to control this type of inflation.
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What were the factors responsible for the successful implementation of land reforms in some parts of the country? Elaborate.
