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FATF Report Creates Trouble For Congress

The FATF Report puts Congress on radar for money laundering

The latest report by FATF titled Money Laundering and Terrorist Financing in the Art and Antiquities Market, has put Congress on the radar for money laundering. 

The Financial Action Task Force (FATF) is an intergovernmental organization founded in 1989 with the aim of combating money laundering and terrorist financing around the world. The organization is responsible for setting international standards and promoting the effective implementation of measures to combat money laundering and terrorist financing.

What does the report say?

  • The report highlights the vulnerabilities and risks associated with the art and antiquities market. 
  • It reveals how criminals and terrorists exploit this market to launder illicit proceeds and finance their activities.
  • It also provides a comprehensive overview of the art and antiquities market and its regulatory environment, identifies the various types of money laundering and terrorist financing risks associated with the market, and highlights the gaps in the existing regulatory framework. 
  • The report also provides recommendations to mitigate, identify and deal with these risks. 

What does it say about India?

The report highlighted a case study titled “Purchase Art with Illicit Proceeds and Use Art of No Value to Pay Kickbacks,” concerning a director and CEO of a bank.

It is an interesting case study highlighting how the CEO paid an over-evaluated amount for an artwork that worked “as a bribe to influence the awarding of the prestigious Indian award ‘Padma Bhushan’ for himself”.

Another case study looked into The Directorate of Enforcement and its investigation into “Stolen Antiquity Exported with False Documentation”. It said that antique “idols were mixed with other new handicraft items and finally exported outside of the jurisdiction, using transhipment through other Asian jurisdictions before arrival in the United States. Many of the items were sold to world famous museums, galleries, art fairs and auction houses.”

The third case story from India covers the story of an imposter who “cheated people for about a decade by using a mixture of deceit and cultivated influence.” 

What are these cases FATF is talking about?

The first case study of the Bank CEO is about Yes Bank CMD Rana Kapoor. Though the report has not named him directly, the details of the case point toward Kapoor. The case also mentions revealed that the suspect bought art of no actual value at a price of USD 264,000 from a close associate of a corrupt politician in order to pay kickbacks.”

The politician in question here is Priyanka Gandhi. The painting referred to is an M F Hussain painting that Kapoor was “forced” to buy from her for Rs.2 crore as stated in the Enforcement Directorate chargesheets. It also states that the proceeds were used to pay for the medical treatment of Sonia Gandhi in New York. 

Anurag Thakur, Minister of Sports, Youth Affairs, and Minister of Information & Broadcasting, in an interview, cited the report and said- 

“One after another, new models of Congress’s corruption are coming to the fore. Sometimes it is National Herald, sometimes Vadra land scam, sometimes some another. Now FATF has published a case study that how a former Union Minister in the UPA government pressurised an individual in buying Priyanka Gandhi Vadra’s average painting for Rs 2 crore. It is a matter of great shame that the story of corruption of the Gandhi family is made into a case study and being told to the whole world, that too by an organization that works to stop terror financing.”

Thakur also questioned,Padma Bhushan being given in exchange for money and painting? Is this a corruption model of the Congress? How many other national honours have you sold for money?”

The third case about the imposter who opened an artifact museum most likely points towards Monson Mavunkal, who claimed to be a doctor, motivational speaker, art promoter and cheated many people. 

The report emphasizes the importance of strengthening the regulatory framework and enhancing international cooperation to prevent the market from being used for illicit purposes.

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Harshita Bajaj

Harshita has a background in Psychology and Criminology and is currently pursuing her PhD in Criminology. She can be found reading crime thrillers (or any other book for that matter) or binge-watching shows on Netflix when she is not in hibernation.
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