Parliament passes Money Laundering Bill
29 November 2002
Mumbai: Parliament has approved legislation to prevent the offence of money laundering, with the Lok Sabha approving the technical amendments suggested by the Rajya Sabha. The Prevention of Money Laundering Bill (PMLB) allows for confiscation of property derived from or involved in money laundering.
The Bill was originally passed in December 1999 by the Lok Sabha and sent to the Rajya Sabha. The Upper House approved the Bill in July 2002 with amendments suggested by the Select Committee.
The Bill, in its modified form, is regarded as a diluted version of the original one. This is because the definition of the offence of money laundering itself has been watered down.
Co-operative banks, non-banking financial companies, chit funds and housing financial institutions come under its ambit. These entities have been covered following the Select Committee's view that NBFCs and chit funds, which collect huge amounts of money from the public, could potentially provide a safe haven to money launderers.
Bill makes it mandatory for banking companies, financial
institutions and intermediaries to maintain a record of
all transactions of a prescribed value and to furnish
information whenever sought within a prescribed time period.
The committee had suggested a time limit of 10 years for
maintaining a record of the transactions.
The minimum threshold limit for certain categories of offences under the Indian Penal Code and other legislations has been fixed at Rs 30 lakh in the Bill.