Vivek Jalan
Quick Summary
The Prevention of Money-Laundering (Maintenance of Records) Rules, 2005 provides for maintenance of records of the nature and value of transactions, the procedure and manner of maintaining and time for furnishing of information and verification of records of the identity of the clients, of reporting
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FAQ :
The PMLA Act, or the Prevention of Money-Laundering Act, along with its associated rules, provides for the maintenance of records regarding the nature and value of transactions, client identity verification, and reporting by entities like banks and financial institutions.
Under the PMLA Rules, a 'principal officer' of a 'reporting entity' is responsible for the maintenance of records and compliance.
The 2023 amendments require the 'principal officer' to be a management-level officer and lower the threshold for identifying beneficial owners in companies and partnerships to 10% of shares, capital, or profits, making client due diligence more stringent.
A 'beneficial owner' is an individual who ultimately owns or controls a client of a reporting entity, or the person on whose behalf a transaction is conducted. This also includes individuals exercising ultimate effective control over a juridical person.
Yes, the Ministry of Finance has permitted three specific reporting entities to perform Aadhaar authentication for the purpose of verifying clients' and beneficial owners' identities as required under Section 11A of the PMLA Act.
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