Title : PREVENTION OF MONEY LAUNDERING ACT

Date : Feb 26, 2022

Description :

GS III

 

Topic à Economy Related Issues

 

• Context:

 

• The Supreme Court has stepped in to stop the misuse of the legislation after a series of searches and arrests of politicians, their relatives, and campaigners under the Prevention of Money Laundering Act (PMLA).

 

• What exactly is the problem:

 

• The number and timing of these raids and arrests have raised questions about PMLA's and its agency, the Enforcement Directorate's, independence (ED).
• Some activists claim that PMLA and ED are being utilized to target opposition camps and cause political embarrassment.

 

• The following are the main allegations:

 

• Ordinary Crimes are being prosecuted under the law.
• Transparency and clarity are lacking: The Enforcement Case Information Report (ECIR), which is similar to the FIR, is a "internal document" that is not released to the accused.

 

• What is the definition of money laundering:

 

• Money laundering is the illicit technique of making money obtained from criminal activities such as drug trafficking or terrorist financing appear to have originated from a legitimate source. The money obtained through illicit activities is seen as 'dirty,' and the laundering process purifies it.

 

• About the Money Laundering Prevention Act:

 

• It was passed in response to India's global commitment to combat money laundering (including the Vienna Convention).

 

• The PMLA was enacted in 2002 and went into effect in 2005 with the goal of preventing money laundering (the process of transforming black money into white) and providing for the seizure of property generated from money laundering.

 

• PMLA is primarily focused on three goals:

 

• Money laundering prevention and control.
• To seize and confiscate the property obtained through the laundering of funds.
• To deal with any other money laundering issues that may arise in India.

 

• Source à  The Hindu

Tags : PMLA, money laundering