OFFENCE OF MONEY-LAUNDERING | PMLA ACT 2002 | JAIIB PPB NOTES 2023-24 | IIBF MODULE A – PPB | PART – 3  

OFFENCE OF MONEY LAUNDERING | PMLA ACT

In this 3rd installment of PPB paper of JAIIB 2024 Exams, we move on to Offence of money laundering under PMLA Act, 2023.

So, we have understood very well the definitions of PMLA act in our previous article (Part -2 of JAIIB PPB PMLA notes) from the Syllabus of Junior Associate of the Indian Institute of Bankers Nov 2023. We also have got some amazing courses on Learning Sessions platforms at the lowest prices! (Links are given at the end of this page). I would like to mention that thousands of students have cleared the JAIIB Exams in Nov 2023 with the help of Learning Sessions lectures.

So, today we will go through the PPB syllabus 2023 topic i.e. PMLA & to be exact its’ Offence of Money-Laundering that are dealt in Chapter – 2, Attachment of property involved in money-laundering as given under Chapter – 3 of the Prevention of Money-Laundering Act, 2002.

Let us begin with the topic: OFFENCE OF MONEY-LAUNDERING

Offence of money-laundering: The Act provides that whoever: 

• directly or indirectly attempts to 
• indulge or knowingly assists or 
• knowingly is a party or 
• is actually involved in any process or activity connected with the proceeds of crime including: 
  • its concealment, 
  • possession, 
  • acquisition or 
  • use and 
  • projecting or claiming 
  • it as untainted property shall be guilty of offence of money-laundering.

DETAILED EXPLANATION OF THE DEFINITION: To remove any of the doubts related to the definition, the act also clarifies that:

(i) A person will be held guilty of money laundering offence if such person is involved in in any of the processes or activities that are connected with the crime proceeds. This involvement could be direct or indirect, it could also be an attempt to indulge or knowingly assist or be a party to the Crime of money laundering. The processes of the offence could be named as:

• Concealment of proceeds of crime;

• Possessing the proceeds of the crime;

• Acquiring the process of the crime;

• Using the proceeds of the crime;

• Projecting the proceeds of the crime as untainted property;

• Trying to claim the tainted property as untainted property;

(ii) The process or activity which is connected with the crime proceeds is a continuing activity and this activity continues till such time a person is enjoying the position of the crime either directly or indirectly by concealing, processing or acquiring using aur projecting as money from untainted sources.

PUNISHMENT FOR MONEY-LAUNDERING. 

Any person who commits the crime of money laundering, shall be punishable with rigorous imprisonment and this imprisonment for not be less than three years but can be extended to 7 years and the guilty person will also be liable to be fine. 

That act provides that in case the proceeds of crimes involved in the money laundering – are related to any offence which has been specified under the paragraph 2 of the part 1 of the schedule of the Act, the search persons in prism and could be extended to further three years making it to be a 10-year imprisonment.

CHAPTER III: ATTACHMENT, ADJUDICATION AND CONFISCATION

Attachment of property that is involved in money-laundering:

1. In case a director or any other officer who is not below the rank of Deputy Director (otherwise for the purpose of this section) has a reason to believe, on the basis of material in possession, and such reason has been recorded in writing, that:

• Any person is possessing any criminal proceeds; and these proceeds are likely going to be concealed, transferred or dealt with in a manner which is going to make the proceedings difficult in a relation to confiscation of such proceeds of crime mentioned in this chapter
• Then such director, by order in writing, attach such property for a period of time, which will not be more than 180 days from the order date, in a manner which has been described in the rules.
• The act provides that no order of attachment shall be made unless and until a report of search intent has been forwarded to the magistrate under section 173 of the CCP, 1973 in a relation to the scheduled of offence; or 
• a complaint has been filed by a person who has the authority to investigate the offence mentioned in the schedule before a magistrate or Court to take cognizance of Scheduled offence; or 
• a similar report or a complaint has been made or filed under any corresponding law of any other country.
• The act further provides, notwithstanding anything contained in provision 1, any property of any person can be attached under this section in case a director or any other officer who is not below the rank of Deputy Director (otherwise for the purpose of this section) has a reason to believe based on the material he or she is possessing, the reason has been recorded in writing – that if the property is not attached immediately under this chapter, it will lead to frustration in the proceedings under the act.
• It’s for the provided that for the purposes of computation of the period of 180 days, the period during which the proceedings under section has been stayed by the High Court – will be excluded & a further period which shall not exceed 30 days from the date of the order of vacation of such stay order shall be counted.

2. FORWARDING THE COPY: Immediately after the attachment of the property, the director or any other officer not below the rank of Deputy Director shall forward a copy, of the order along with the material in his or her possession, in a sealed envelope, as referred in the subsection, to the adjudicating authority in a prescribed manner. Search adjudicating authority shall keep this order and material for such period as it may have been prescribed.
3. CESSESSION OF ATTACHMENT: Every attachment order that has been made in the sub section 1 of this section will cease to have effect after the period mentioned in the same section has expired or on the date of the order made under subsection 3 of Section 8, whichever comes earlier.
4. ENJOYMENT OF ATTACHED PROPERTY: Nothing that has been mentioned in this section shall prevent the person who is interested in the enjoyment of the immovable property attached under subsection 1.
5. FILING OF COMPLAINT: The director or the other officer who has provisionally attached to any property under subsection 1 is required to file a complaint stating the reason/facts of such attachment today adjudicating authority within a period of 30 days from such attachment.

So, this was the first step in the commencement of the proceedings that has come under notification of the authorities responsible for administration of the act. In the next part, we will read more about the adjudicating authorities, their composition and powers. 

You can find more free notes on the principles and practices of banking paper of JAIIB for 2020-23 papers. You can also the best of the steering materials available for the JAIIB exam at any of the following platforms:

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