What is money laundering?

'Any act or attempted act to conceal or disguise the identity of illegally obtained proceeds so that they appear to have originated from legitimate sources'. In other words, it is the processes used by criminals through which they make “dirty” money appear “clean”.

The Prevention of Money Laundering Act, 2002 (PMLA 2002) forms the core of the legal framework put in place by India to combat money laundering. PMLA 2002 and the Rules notified thereunder came into force with effect from July 1, 2005. Director, FIU-IND and Director (Enforcement) have been conferred with exclusive and concurrent powers under relevant Sections of the Act to implement the provisions of the Act.

Sec.3 of PML Act, 2002 defines offence of ‘money laundering’ as: “whosoever 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 and projecting it as untainted property shall be guilty of the offence of money-laundering”

The PMLA 2002 and Rules notified there under impose an obligation on banking companies, financial institutions and intermediaries to verify identity of clients, maintain records and furnish information to FIU-IND. The PML Act imposes obligations on entities that provide financial services to sufficiently identify their clients.

To meet these obligations, Way2Wealth Brokers Private Limited has implemented a number of new processes aimed at ensuring we comply with the AML Act. In particular, we have changed our identification procedures involving the collection and verification of client information. To satisfy the identification requirements, we need to obtain current, valid, certified copies of identification documents for each client applicant. Where the client is other than a natural person, this extends to the identification of the persons who operate the entity and/or have a beneficially interest in the entity.

The obligations on the clients are as follows:
- Provide complete details at the time of account opening viz. address proof, ID proof, PAN etc, Income details
- Periodically update the financial details.
- The transaction executed need to commensurate with the disclosed income details.

These requirements will affect all new clients, however in some cases we may need to obtain additional information from existing clients if we consider that the information we currently hold does not meet the new identification requirements. We are also required to keep a record of the identification checks we have performed and may be requested by the relevant regulator to produce for inspection copies of the information and verification details we hold.

Financial Intelligence Unit – India (FIU-IND) was set by the Government of India vide O.M. dated 18th November 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. More information on can be found at http://fiuindia.gov.in/

Securities Exchange Board of India is our regulator. It has information on the operation of the new anti-money laundering and counter terrorism financing laws, including the PML Act, on its website at http://www.sebi.gov.in. You may find the SEBI site useful if you require further information on the PML Act and its implications. You may also obtain information from the websites of exchanges viz., www.nseindia.com , www.bseindia.com .

Your privacy is of the utmost importance to us and we will continue to abide by the agreement. Our privacy policy can be viewed by clicking on http://www.way2wealth.com/privacy_policy.asp