Prevention of Money Laundering Act will need more changes

Devesh K Pandey, NEW DELHI,  APRIL 15, 2018 21:53 IST

To comply with FATF norms, money laundering must be a standalone offence

India will have to make money laundering an explicitly standalone offence to upgrade its compliance ahead of the on-site mutual evaluation by the Financial Action Task Force (FATF), which is due in November-December 2020.

Among the key recommendations of the FATF, an international body that sets global standards for fighting illicit finance, is that money laundering be made a standalone offence.

Despite several amendments, the Prevention of Money Laundering Act (PMLA) remains a predicate-offence-oriented law. This means a case under the Act depends on the fate of cases pursued by primary agencies such as the CBI, the Income Tax Department or the police. The latest instances are the verdicts in the 2G spectrum and Aircel-Maxis cases by the CBI courts, in which the money laundering angle probed by the Enforcement Directorate fell apart.

Karnataka case

On the issue of attachment of assets, however, the Karnataka High Court, in a 2016 judgment, appreciated the agency’s stand that money laundering was a standalone offence in view of Sections 5 and 8 amended in 2013, read with the definition of ‘property’ in Section 2(1)(v) of the Act.

The Enforcement Directorate is empowered to investigate the financial aspects of those crimes, as defined under the other penal laws, which are listed in the PMLA schedule.

The first FATF mutual evaluation of India was done in 2010 when the body expressed satisfaction with the measures taken by the country. However, in the same breath, the FATF highlighted, in its 256-page report, a number of lacunae in the then extant legislation, for which it suggested changes. Since then, a range of laws have been amended.

After analysing PMLA provisions, the FATF recommended that “legal measures are taken to allow for confiscation of the money laundered as subject of the ML [money laundering] offence and which is not contingent on conviction for the predicate offence [stand-alone ML offence].”

The report said: “The predicate offence conviction condition creates fundamental difficulties when trying to confiscate the proceeds of crime in the absence of a conviction of a predicate offence, particularly in a standalone ML case, where the laundered assets become corpus delicti [concrete evidence of a crime] and should be forfeitable as such.”

Reference

Comments

Post a Comment

Popular posts from this blog

India Joins Russia in Voting Against West-Backed Move to Expand Powers of OPCW

The Wire: June 28, 2018 New Delhi: India voted against a UK-backed move that will allow the global chemical weapons watchdog to apportion blame for illegal attacks, criticising the decision to grant “unchecked powers” to the head of the group which could be used for “partisan” purposes. On Wednesday, more than two-thirds of the member states of the Organisation for the Prohibition of Chemical Weapons (OPCW) voted to authorise the international body to identify the perpetrators and sponsors of a chemical weapons attack. It also specifically called on the OPCW’s technical secretariat to begin work on identifying the perpetrators behind the use of chemical weapons in Syria. The draft decision, sponsored by 30 countries, was adopted at the fourth special session of the conference of the states parties to the Chemical Weapons Convention at the Hague, with 82 in favour and 24 negative votes. While Europe, the United States and their allies voted ‘yes’, there was strong oppo...
Read more

As financial insecurity rises in urban India, so does investment in insurance

Image
Scroll.in March 13, 2020 Urban Indians are becoming less confident about their financial security. Up to 58% of them fret over financial independence post retirement, which is a 4% increase from last year. An equal share of urban Indians worry about meeting their daily medical expenses and sustaining their current lifestyle once they stop working. The findings are part of a survey published by Delhi-based Max Life Insurance in association with London-based consultancy Kantar. The firms surveyed 7,014 respondents in 25 cities, including six metros, nine tier-1 cities, and 10 tier-2 cities, between December 2019 and January 2020. Source: Max Life Insurance via Quartz The trends Source: Max Life Insurance via Quartz Source: Max Life Insurance via Quartz Source: Max Life Insurance via Quartz A significant share of urban Indians also say their families will have no financial support in the event of the breadwinner’s death. In such a scenario, around 57% believe the family sav...
Read more

ED tracks Swiss Bank A/Cs of Agusta scamster

The Poineer February 10,2019 Rakesh K Singh The Enforcement Directorate (ED) has tracked a dozen Swiss bank accounts in the name of Rajiv Saxena, who is key accused in the Rs 3,600 crore AgustaWestland VVIP chopper scam. The ED has also found out accounts held by  his family members and associates where the kickbacks in the now scrapped deal were allegedly parked. Two bank accounts are in the name of Rajiv Saxena’s  associates Pankaj Jain and Sumita Jain who are also the authorised signatories. The  third is in the name of another associate Ajit Singh Bubber, but Rajiv and his family members are authorised signatories. The remaining nine accounts are largely owned and operated by Rajiv, his family members and associates. Rajiv Saxena was deported by the UAE authorities on January 30 and the ED formally arrested him the next day and a court later granted his remand to the agency. He is currently undergoing custodial interrogation by the ED. The agency had in 2017...
Read more