Nepal has seen a significant rise in suspicious transaction and activity reports (STRs) related to financial crimes, with cases increasing by 24 percent in Fiscal Year 2023/24, according to the latest report from the Financial Intelligence Unit (FIU) Nepal.

The report highlights growing concerns over tax evasion, banking and monetary fraud, foreign exchange violations, insurance fraud, cooperative sector irregularities, and illegal gambling, among other offenses.

The FIU’s annual report reveals that 7,338 STRs were submitted to Nepal’s GoAML system in Fiscal Year 2023/24, up from 5,935 in the previous year. Of these, 1,632 reports were analyzed while 889 reports were forwarded to law enforcement agencies for further investigation. Additionally, 746 reports were documented for future re-analysis if new information emerges.

In addition to STRs, border transaction reports submitted under the Prevention of Money Laundering Act, 2007, totaled 1,697,712 in Fiscal Year 2023/24, a slight decline from 1,698,398 in the previous year.

Nepal remains under additional monitoring by the Financial Action Task Force (FATF) following its third round of mutual evaluation in 2023. The country is working to implement a time-bound action plan to strengthen its anti-money laundering measures and exit the grey list list.

The report also identifies emerging trends in financial crimes, including hundi transactions, cyber fraud, illegal online gambling, misuse of intangible assets, trade-based money laundering, and corruption. It stresses the need for stronger regulatory oversight and enforcement to combat evolving financial threats.

As part of Nepal’s anti-money laundering efforts, 1,639 investigative and regulatory agencies are now affiliated with the GoAML system, reflecting the country's growing focus on tackling financial crimes. -- RSS