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Changes in Prevention of Money Laundering Act

  • Category
    Economy
  • Published
    20th Aug, 2019

The Centre has issued a notification on certain changes in the Prevention of Money Laundering Act (PMLA).

Context

The Centre has issued a notification on certain changes in the Prevention of Money Laundering Act (PMLA).

About

The notification will bring the following changes:

  • Money laundering will be treated as a stand­alone crime.
  • The ambit of “proceeds of crime” to assets that may have been derived from any other criminal activity related to scheduled offences.
  • Under the Act, only Enforcement Directorate (ED) is empowered to conduct money laundering investigation. For any other agency to probe into an offence listed in the PMLA Schedule, a FIR or chargesheet was required to be filed by that particular agency. This requirement has been done away with.
  • All PMLA offences will be cognisable and non­bailable. It implies that ED officers are empowered to arrest an accused without warrant.
  • The jurisdiction of the Special Court, while dealing with the offence under this Act shall not be dependent upon any orders passed in respect of the scheduled offence.

Enforcement Directorate (ED)

  • It is a specialized financial investigation agency under the Department of Revenue, Ministry of Finance, Government of India, which enforces the following laws: -
    • Foreign Exchange Management Act,1999 (FEMA) - a Civil Law.
    • Prevention of Money Laundering Act, 2002 (PMLA) - a Criminal Law.

Difference between Criminal Law and Civil Law

  • Criminal law deals with offences which are regarded in the public as wrongagainst the state and are therefore punished by the state if found guilty of the offence (even if the victim is an individual)
  • Example: kidnapping, Rape, Murder,  money laundering
  • On the other hand, Civil Law deals with disputes between Private individuals.
  • One of the most important distinctions between civil and criminal law is the standard of proof.
  • In Criminal Cases, the prosecution must prove the case against the defendant beyond reasonable doubt whereas it is not so high in case of Civil Cases.

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