Our country has criminalized money laundering under both the Prevention of Money Laundering Act, 2002 (PMLA), as amended in 2005. This act levies a fine up to Rupees five lakhs, this upper limit of fine which the new bill proposes to remove and increase. The Prevention of Money Laundering Act, 2002 is an Act of the Parliament of India enacted to prevent money laundering and to provide for confiscation of property that is derived from money laundering.
The Act imposes an obligation on banking companies, financial institutions, and intermediaries to verify the identity of clients, maintain records and furnish information in a prescribed form to the competent authorities formed and appointed in that regard. The PMLA seeks to combat acts pertaining to money laundering in India and in view of this, it mainly has three main objectives: (1) Prevention and control of money laundering (2) Confiscation and seizure of property obtained from laundered money (3) Manner to deal with any allied issued.