The Prevention Of Money Laundering (Amendment) Bill, 2011

Important Info:

Ministry: Ministry of Finance

Current Status: Lok Sabha passed it on November 29, 2012

Introduction: Introduced in the Lok Sabha on Dec 27, 2011

The Lok Sabha passed the Unlawful Activities (Prevention) Amendment Bill, 2011 on November 29, 2012. The Bill will be a step towards fulfilling commitments made at the Financial Action Task Force, which is an international organisation to combat money laundering and financing of terrorism.

The Bill enhances the period for which a group can be declared as unlawful from two to five years. More criminal activities including threat to the economic security of the country and peddling high security counterfeit currency will come under its purview.

The Bill does not discriminate between any communities or groups. There are provisions in the Bill to prevent its misuse by the police. The Amendment Bill was adopted by the Lok Sabha by a voice vote.

The amendment Bill was introduced by the then Minister of Finance, Mr Pranab Mukharjee in the Lok Sabha on December 27, 2011.

Highlights

• Parliament has improved upon the money laundering law in 2005, after bringing it in 2002, and then again in 2009 and once again in 2012.
• This Bill seeks to amend the Prevention of Money Laundering Act, 2002.
• It will introduce the concept of ‘corresponding law’ to link the provisions of Indian law with the laws of foreign countries.
• Concept of ‘reporting entity’ has been introduced by this amendment.
• The bill covers banking company, financial institution, intermediary or a person carrying on a designated business or profession.
• Expanding the definition of money laundering, offences like concealment, acquisition, possession and use of proceeds of crime have been included.
• It also seeks to remove existing limit of Rs 5 lakh as fine under the Act.
• The Bill seeks to provide for provisional attachment and confiscation of property of any person (for a period not exceeding 180 days).
•  The Bill proposes to confer powers upon the Director to call for records of transactions or any additional information that may be required for the purposes of investigation.  The Director may also make inquiries for non-compliance of the obligations of the reporting entities.
• Reporting entity, its designated directors on the Board and employees will be responsible responsible for omissions or commissions.
• Against the order of the Appellate Tribunal, one can appeal directly to the Supreme Court within 60 days.
• The Bill seeks to provide for the process of transfer of cases of the Scheduled offences pending in a court (which had taken cognizance of the offence) to the Special Court for trial.