Friday, June 2, 2023 5:15 pm

Anti-Money Laundering Law Now Includes  Client Transactions by CA, CS, CWA

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In a statement released today, the Finance Ministry stated that all client transactions carried out by any CA, CS, or CWA shall be subject to the pertinent parts of the Prevention of Money Laundering Act, 2002, or PMLA.

The Prevention of Money Laundering Act, 2002 (PMLA) currently governs financial transactions undertaken by chartered accountants (CA), company secretaries (CS), and cost and works accountants (CWA) on behalf of their customers in an effort to reduce money laundering in India. On May 5, 2023, the Finance Ministry published a notification with this effect.

According to the notification, the PMLA will be used to monitor all client transactions made by these professionals, including managing money, securities, and other assets, buying and selling any real estate, managing bank accounts, coordinating contributions to form corporations, operating or managing corporations, limited liability partnerships, or trusts, and buying and selling entities.

By encouraging finance professionals to exercise greater due diligence when dealing with their clients, this step is anticipated to boost the nation’s effort to combat money laundering. The PMLA’s inclusion of CA, CS, and CWA will also serve as a deterrent against the abuse of their professional licences.

It is important to remember that the PMLA has historically been utilised to take assets from fugitives and serious financial criminals. This most recent change is anticipated to increase the act’s effectiveness in reducing money laundering in India.

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