Amendments to Prevention of Money Laundering Act

The Finance Bill 2019 has proposed amendments to tighten the anti-money-laundering law.

Amendments Proposed

• A total of eight amendments were proposed to the Prevention of Money Laundering Act (PMLA), 2002, of which six are explanations to the existing clauses.
• The explanations are being brought in to certain existing clauses to remove the “confusion, grey area or ambiguity which might exist” in the Act.
• The amendments seek to widen the definition of the of ‘proceeds of crime’ stating that a property will be considered as tainted if it relates to any offence on the basis of which a PMLA case has been slapped.
• The amendment also proposes that “a person shall be guilty of offence of money-laundering if such person is found to have directly or indirectly attempted to indulge or knowingly assisted or knowingly is a party or is actually involved” in “concealment, or possession, or acquisition, or use, or projecting as untainted property or claiming as untainted property.”

With the amendment to the definition of proceeds of crime the government has widened the ambit  to not only include property obtained from the PMLA offence but also any property which may “directly or indirectly” be obtained as a result of any criminal activity related to the scheduled offence on the basis of which a money laundering case is filed.