Prevention of Money Laundering Act, 2002 (PMLA) – Sections 3, 45, and 70 – Scope of “Offence of Money Laundering” against Directors without implicating Company in PMLA proceedings A company committing a scheduled (predicate) offense does not necessarily have to be implicated as an accused in a PMLA complaint if the directors or individuals are found to have committed the act of money laundering (concealment, possession, acquisition, or use of proceeds of crime) in their individual capacity. The offense of money laundering under Section 3 PMLA is distinct from the predicate offense and can be committed by any person involved with the proceeds of crime, regardless of their role in the company or their inclusion as an accused in the predicate offense.
Prevention of Money Laundering Act, 2002 (PMLA) – Section 70 – Distinction from Negotiable Instruments Act, 1881 (NI Act) and other penal statutes Unlike offenses under the NI Act or similarly worded provisions in other penal statutes where the company’s involvement as an accused is indispensable, Section 70 of PMLA allows for the prosecution of individuals (directors, etc.) for money laundering even if the company that committed the predicate offense is not arrayed as an accused in the PMLA complaint, especially if the proceeds of crime are traced to the individuals.
Prevention of Money Laundering Act, 2002 (PMLA) – Section 24 – Presumption against Accused Section 24 of PMLA creates a presumption that proceeds of crime are involved in money laundering, placing the burden of proving the contrary on the accused.