The Prevention of Money Laundering (Amendment) Bill, 2011
Investigating agencies may soon get more powers to attach and confiscate properties in cases of money laundering. The Prevention of Money Laundering (Amendment) Bill, 2011, is likely to propose sweeping changes in the procedures relating to attachment and confiscation of property. It may also bring in more reporting entities and a new category of offences with cross-border implications. The changes are in line with recommendations of the global Financial Action Task Force (FATF), an inter-governmental policy making body, with a mandate to establish international standards for combating money laundering and terror financing.
The Bill may provide for reporting obligations on KnowYour-Customer norms for various new entities and sectors such as gems and jewellery, shares, insurance and property. Under the existing Act, it is obligatory for only banking companies, financial institutions and intermediaries of stock markets to verify and maintain the records of all transactions and the identity of clients. Earlier amendments to PMLA had significantly widened the scope of money laundering investigations. The provisions allow for attachment of tainted proceeds located abroad by requesting foreign administrations. The amendments may increase the scope of such powers.India became a member of FATF in June 2010. It gave an action plan in June 2010 and followed with an Action Taken Report in October 2010 and February 2011.
During the second meeting of the FATF Plenary in Paris this February,India reiterated its commitments to adopt, enforce and contribute to international best practices in anti-money laundering and counter terrorist financing.
The draft Bill is attached herewith for information and comment. Please find the attachment.