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Polity & Governance
Mahesh

06/05/23 06:05 AM IST

Anti-Money Laundering Law

In News
  • Chartered accountants, company secretaries and works accountants who buy property, establish a company and execute financial transactions on behalf of their clients will now be covered under the anti money laundering law.
About PMLA
  • The Prevention of Money Laundering Act (PMLA) is a law that was passed in 2002 to combat money laundering and other financial crimes.
  • It was designed to prevent the use of illegal funds to finance terrorist activities and other unlawful acts.
  • The PMLA has been amended several times since its introduction to expand its coverage and strengthen its provisions.
New Provisions
  • Chartered accountants, company secretaries, and cost and works accountants have now become “reporting entities” and are responsible for verifying the identity of clients, examining their financial position, and recording the purpose of the transaction.
  • If they assist in a transaction that breaches the law, they will be held responsible under the Prevention of Money Laundering Act (PMLA).
  • The director of the Financial Intelligence Unit (FIU) has the power to impose penalties under Section 13 of the Act for non-compliance with the law.
  • The Act also stipulates confidentiality on information sought from the reporting entity, requiring adherence to the strictest of professional standards.
  • This move is expected to strengthen the government’s efforts to combat money laundering and other financial crimes.
Source- Indian Express

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