SIT asks RBI to share black money data with government agencies

NEW DELHI: The Supreme Court-appointed Special Investigation Team ( SIT) on black money has asked the Reserve Bank of India to establish an institutional mechanism to track illicit financial flows and share data with other law enforcement agencies such as Enforcement Directorate, Directorate of Revenue Intelligence and the Central Board of Direct Taxes.

In a letter to Reserve Bank governor on August 11, the SIT headed by Justice MB Shah (retd) underlined the need for creating a data warehouse from where various agencies can gather relevant information for taking early appropriate action, the finance ministry said in a statement.

In the light of “gaps in the regulatory framework”, the SIT in its letter impressed upon RBI the need to establish the institutional mechanism for sharing of data with the central bank in its various databases with the enforcement authorities.

The data available with RBI could be “cross checked with other information available with enforcement authorities and illicit financial flows could be curbed”, the SIT said.

The SIT had in the past asked Reserve Bank of India to provide data on advance remittances and export outstanding of more than one year.

However, the Special Investigation Team said the data provided “clearly showed that there are gaps in monitoring trade flows which are used by unscrupulous elements to take out precious capital outside the country, thus damaging the fabric of Indian economy”.

The SIT is of the view that data could be shared only by having one agency such as Central Economic Intelligence Bureau (CEIB) or any other agency, as a data warehouse.

“From the said data warehouse, various agencies can gather the relevant information for taking early appropriate action. This is so since the data available with one agency can be relevant to action expected to be taken by other law enforcement agency,” the SIT said, according to the finance ministry statement.

At present, Reserve Bank of India holds the information with respect to all types of foreign exchange transactions.

The SIT has also asked the department of revenue to identify a single point agency which could access the database relating to foreign exchange transactions as well as trade related payments, and thereafter disseminate them to the various enforcement agencies.