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8) What are the statutory and the institutional framework for dealing with money laundering in India. Discuss.(250 words)

Topic-Challenges to internal security through communication networks, role of media and social networking sites in internal security challenges, basics of cyber security; money-laundering and its prevention

8) What are the statutory and the institutional framework for dealing with money laundering in India. Discuss.(250 words)

Reference

 

Why this question

There has been a spate of money laundering cases in India in recent years. India has also been successful in seeking extradition of several high profile economic offenders from foreign countries. In this context it is essential to understand the framework for dealing with money laundering in India.

Directive word

Discuss- this is an all-encompassing directive which mandates us to write in detail about the key demand of the question. we also have to discuss about the related and important aspects of the question in order to bring out a complete picture of the issue in hand.

Key demand of the question.

The question wants us to write in detail about the  statutory and the institutional framework for dealing with money laundering in India.

Structure of the answer

Introduction– Write a few introductory lines about the  money laundering. E.g describe the meaning and process of money laundering in brief lines.

Body-

  1. Discuss the statutory framework for dealing with money laundering in India. E.g
  • PMLA Act
  • It prescribes obligation of banking companies, financial institutions and intermediaries for verification and maintenance of records of the identity of all its clients and also of all transactions and for furnishing information of such transactions in prescribed form to the Financial Intelligence Unit-India (FIU-IND).
  • It empowers the Director of FIU-IND to impose fine on banking company, financial institution or intermediary if they or any of its officers fails to comply with the provisions of the Act as indicated above.
  • PMLA envisages setting up of an Adjudicating Authority to exercise jurisdiction, power and authority conferred by it essentially to confirm attachment or order confiscation of attached properties.
  1. Discuss the regulatory framework. E.g
  • ED and FIU
  • PMLA empowers certain officers of the Directorate of Enforcement to carry out investigations in cases involving offence of money laundering and also to attach the property involved in money laundering.
  • Financial Intelligence Unit – India in 2004 as the central national agency responsible for receiving, processing, analyzing and disseminating information relating to suspect financial transactions.
  • FIU-IND is also responsible for coordinating and strengthening efforts of national and international intelligence, investigation and enforcement agencies in pursuing the global efforts against money laundering and related crimes. FIU-IND is an independent body reporting directly to the Economic Intelligence Council (EIC) headed by the Finance Minister.

Conclusion– based on your discussion, form a fair and a balanced conclusion on the given issue.