Suspicious Transactions Surge by 24%, Nepal Rastra Bank Report Reveals

The Financial Information Unit (FIU) of Nepal Rastra Bank has released its annual report for the fiscal year 2080/81 (2023/24), highlighting a 24% increase in suspicious transactions and activities. According to the report, the number of suspicious transactions rose from 5,935 in fiscal year 2079/80 (2022/23) to 7,338 in fiscal year 2080/81.

The central bank noted that the majority of these suspicious activities are linked to offenses such as tax evasion, monetary/banking/foreign exchange/insurance/cooperative-related issues, fraud, lotteries/gambling/betting, and similar crimes. Under the Money Laundering Prevention Act, 2064 (2008), the total number of reporting entities, law enforcement/investigative agencies, and regulatory bodies integrated into the FIU’s goAML system has reached 1,639.

The report indicates a slight decline in threshold transactions, with the number dropping from 1,698,398 in fiscal year 2079/80 to 1,697,712 in fiscal year 2080/81. However, suspicious transaction and activity reports surged by 34% compared to the previous year.

In fiscal year 2080/81, a total of 1,632 reports were analyzed, out of which 889 were forwarded to law enforcement/investigative agencies and regulatory bodies for further investigation or action. The remaining 746 reports have been archived by the FIU for potential re-analysis if additional information becomes available in the future.

The report also sheds light on Nepal’s efforts following the completion of its third mutual evaluation in 2023. After being placed on the Financial Action Task Force (FATF) enhanced monitoring list, Nepal has been working on time-bound action plans to exit the list, with progress made during the one-year observation period highlighted in the report.

Additionally, the FIU’s national and international coordination efforts to combat money laundering and terrorist financing, as well as capacity-building activities for its staff, related agencies, and reporting entities, have been detailed. The report further outlines prevalent methods and trends in money laundering and financial crimes in Nepal, including hundi (informal money transfer), cyber fraud, illegal online gaming, virtual assets, tax evasion, corruption, and laundering through import-export channels.

Nepal Rastra Bank has published this report to provide comprehensive insights into the FIU’s annual operations and the state of Nepal’s anti-money laundering framework.