FIU-IND
Also written Financial Intelligence Unit – India · Financial Intelligence Unit India · FIU
India's central national agency for receiving, processing, analysing and disseminating information on suspect financial transactions, set up in November 2004 and reporting to the Economic Intelligence Council.
In plain language
Every reporting entity in India sends its reports to one place. These are reports on cash deals, cross-border transfers and suspicious transactions. That place is the Financial Intelligence Unit – India, or FIU-IND.
The Government of India set it up by an Office Memorandum dated 18 November 2004. It is the central national agency for suspect financial transactions. It receives the information, processes it, studies it and passes it on. It also brings together the work of agencies in India and abroad against money laundering and terrorist financing. That work covers intelligence, investigation and enforcement.
It is an independent body. It reports directly to the Economic Intelligence Council (EIC), which is headed by the Finance Minister. It does not report to RBI, to SEBI or to the Directorate of Enforcement.
How it works
FIU-IND has six stated functions, and the reports it collects are the whole first one:
- Collection — the central reception point for Cash Transaction Reports (CTRs), Non-Profit Organisation Transaction Reports (NTRs), Cross Border Wire Transfer Reports (CBWTRs), Reports on Purchase or Sale of Immovable Property (IPRs) and Suspicious Transaction Reports (STRs).
- Analysis — to uncover patterns suggesting money laundering.
- Sharing — with national intelligence and law enforcement agencies, regulators, and foreign Financial Intelligence Units.
- Central repository — a national database built from those reports.
- Coordination — national, regional and global.
- Research and analysis — trends and typologies.
It is also a penalising authority. Under Section 13 of the PMLA the Director, FIU-IND can issue directions under 13(2)(a) and 13(2)(b) and impose a monetary penalty under Section 13(2)(d). Section 13 powers and the Director (Enforcement)'s powers are described in the Act as exclusive and concurrent.
For IFSCA-licensed units, all filing runs through the FINGate 2.0 portal — the front-end web portal of FINNET 2.0 — and non-registration is itself treated as non-compliance with the IFSCA Guidelines. Reports go to the Director, FIU-IND at the 6th Floor, Tower-2, Jeevan Bharati Building, Connaught Place, New Delhi-110001.
A worked example
Three FIU-IND orders in the workbook, three different failures and three very different price tags:
| Reporting entity | Order dated | Failure | Penalty |
|---|---|---|---|
| Way2Wealth Brokers | 10 Nov 2022 | Alerts not raised, investigated or filed as an STR for December 2021 transactions | Rs 1,00,000 |
| Paytm Payments Bank | 15 Mar 2024 | No internal mechanism to detect and report suspicious transactions on its Payout service; no ongoing due diligence; bad third-party KYC reliance; no STRs for 34 beneficiary accounts | Rs 5,49,00,000 |
| Bybit Fintech | 31 Jan 2025 | Operated in India as a VDA SP without registering with FIU-IND at all | Rs 9,27,00,000 |
The arithmetic behind Paytm is worth pausing on. Rule 8(4) says that delay of each day in not reporting a transaction, or in rectifying a mis-reported one, beyond the time limit constitutes a separate violation. An STR is due within seven working days of concluding that a transaction is suspicious. Thirty-four accounts, each late by weeks, is not one failure — it is a multiplication table, and that is how a reporting lapse becomes five and a half crore rupees.
Why NISM asks about it
Chapter 1 (section 1.4.4) and Chapter 2 (section 2.3.2) both set out FIU-IND's origin date, its reporting line to the Economic Intelligence Council and its six functions — the Chapter 1 sample question asks which organisation receives and analyses cash and suspicious transaction reports. Chapter 7 is nothing but FIU-IND and IFSCA orders. Expect recall on the 2004 date, on the EIC reporting line, and on which report types FIU-IND receives.
Common exam traps
- FIU-IND reports to the Economic Intelligence Council, headed by the Finance Minister — it is not a wing of RBI, SEBI or the Directorate of Enforcement.
- FIU-IND analyses and penalises; the Directorate of Enforcement investigates and prosecutes. Both draw powers from the PMLA, described as exclusive and concurrent.
- It receives five report types, not just STRs — CTRs, NTRs, CBWTRs, IPRs and STRs.
- Each day of delay is a separate violation under Rule 8(4). This is the single most expensive sentence in the Rules.
- Registration is separate from reporting. Bybit's penalty was for never enrolling on FINGate 2.0.
- The unit is FIU-IND — India's FIU. FATF Recommendation 29 requires every country to have one; they are not one global body.
Where this is taught
- Series XXI-B · Chapter 8: Operational Aspects of Portfolio Managersintroduced here
- Series IFSCA-01 · Chapter 1: Introduction to Anti Money Laundering (AML), Combating the Financing of Terrorism (CFT) and Proliferation Financing (PF)introduced here
- Series III-A · Chapter 2: Regulatory Framework - General Viewintroduced here
- Series XXIV · Chapter 1: Introduction to Anti Money Laundering (AML), Combating the Financing of Terrorism (CFT) and Proliferation Financing (PF)introduced here
- Series XXI-A · Chapter 8: Operational Aspects of Portfolio Managersintroduced here
- Series VIII · Chapter 10: Sales Practices and Investor Protection Measuresintroduced here
Related terms
- Principal officerThe named individual at a non-individual intermediary who carries personal regulatory responsibility for the advisory business, and who must personally hold the prescribed qualification and NISM certification.
- Directorate of EnforcementThe multi-disciplinary agency that investigates the offence of money laundering and foreign exchange violations, enforcing the PMLA, FEMA, the Fugitive Economic Offenders Act and sponsoring COFEPOSA cases.
- FATFThe intergovernmental body founded in 1989 that writes the global AML/CFT standards — the 40 Recommendations plus IX Special Recommendations — and grey-lists or black-lists countries that fail them.
- FINGate 2.0FINNET 2.0's front-end web portal — the platform on which every IFSCA-licensed regulated entity must register with FIU-IND, and through which suspicious transactions are reported.
- Reporting entityUnder Section 2(1)(wa) of the PMLA, a banking company, financial institution, intermediary or person carrying on a designated business or profession — the entity that must keep records and report to FIU-IND.
- Suspicious Transaction ReportA report a SEBI intermediary must file with FIU-IND within 7 days of concluding that a transaction or connected series of transactions is suspicious — and must never disclose to the client.
- Capital market intermediariesRegistrars and Transfer Agents, Custodians and Depositories: the firms that service both the primary and secondary market, as distinct from brokers, merchant bankers and mutual funds, which trade or manage money.
- IFSCAThe unified regulator of India's International Financial Services Centre, established in April 2020, holding inside the IFSC the powers that RBI, SEBI, IRDAI and PFRDAI hold outside it.
- Designated DirectorThe person a reporting entity designates to ensure overall compliance with Chapter IV of the PMLA — and, where the entity is located in an IFSC, the person heading that entity in India.
- Adjudicating AuthorityThe quasi-judicial body constituted by the Central Government under Section 6 of the PMLA that issues notices, adjudicates attachments of property and confirms confiscations.
- Virtual Digital Asset Service ProviderA provider of services related to virtual digital assets — a reporting entity under section 2(1)(wa) of the PMLA, which must register with FIU-IND and meet its record-keeping and reporting duties.
- UNSC sanctions listsThe UN Security Council's ISIL (Da'esh) & Al-Qaida Sanctions List and 1988 Sanctions List — no IFSC regulated entity may hold an account in a listed name, and resembling accounts go to FIU-IND and MHA.
- Third-party relianceUsing another regulated firm's client due diligence instead of doing your own — permitted under Rule 9(2) of the PML Rules on six conditions, with the relying entity still ultimately responsible.
- Physical presence requirementThe requirement that an IFSC unit keep its office premises open with its people physically there, including the Principal Officer and Key Managerial Personnel, who are mandated to be based out of the IFSC.
- Serious Fraud Investigation OfficeThe multi-disciplinary investigation agency under the Ministry of Corporate Affairs that investigates complex corporate frauds assigned by the Central Government under section 212 of the Companies Act, 2013.
- Economic Offences WingThe wing of the CBI, created in 1964 and expanded into a full Economic Offences Division in 1994 after the 1992 securities scam, that investigates serious financial frauds including share price manipulation.
- Board for Financial SupervisionThe committee of RBI's Central Board, constituted in 1994, that directs RBI's consolidated supervision of commercial banks, financial institutions and NBFCs.
- Non-profit organizationUnder the PML framework, an entity constituted for religious or charitable purposes under section 2(15) of the Income-tax Act and registered as a trust, a society or a section 8 company.
- Central Bank Digital CurrencyA digital representation of fiat currency issued by a central bank — expressly outside the scope of FIU-IND's AML/CFT/PF guidelines for virtual digital asset service providers.
- PMLAThe Prevention of Money Laundering Act, 2002 — the core of India's legal framework against money laundering, in force from 1 July 2005, binding banks, financial institutions and intermediaries.