{"id":64880,"date":"2023-04-07T15:33:55","date_gmt":"2023-04-07T10:03:55","guid":{"rendered":"https:\/\/enterslice.com\/learning\/?p=64880"},"modified":"2023-04-07T15:33:56","modified_gmt":"2023-04-07T10:03:56","slug":"powers-of-director-to-impose-fine-under-pmla","status":"publish","type":"post","link":"https:\/\/enterslice.com\/learning\/powers-of-director-to-impose-fine-under-pmla\/","title":{"rendered":"Powers of Director to Impose Fine under PMLA"},"content":{"rendered":"

Chapter IV of The Prevention of Money Laundering Act 2002<\/strong>[1]<\/strong><\/a><\/sup> deals with the obligations of the reporting entities wherein they are obligated to maintain the records of all the financial transactions concerning the prescribed nature and value of such transactions along with the documents which provide evidence of its client’s identity and beneficial owners along with the account files and business correspondence relating to its clients,  and report the same in prescribed timeline and manner together with keeping such information confidential.
The failure of the reporting entities to comply with the same results in exercising the Powers of Director to Impose Fine under PMLA<\/a> as enumerated in section 13 of the said Act, which shall be discussed in the present article.<\/p>\n\n\n\n

What are the Powers of Director to Impose Fine under PMLA?<\/h2>\n\n\n\n

Section 13 of the PMLA deals with the Powers of Director to Impose Fine under PMLA wherein –<\/p>\n\n\n\n

An inquiry regarding the obligations of the Reporting Entity (RE) can be carried out either by the Director’s own motion or through the receipt of an application from any person, officer or authority requesting to conduct the same as deemed fit by the Director.<\/p>\n\n\n\n

The Director, at any stage of the inquiry or any other proceedings before him, can direct the reporting entity to produce the specified records, the audit of which must be done by an accountant from a panel of accountants maintained by the Central Govt if he opines that the production of such a record is necessary after taking into consideration the nature and complexity of the case. <\/p>\n\n\n\n

If the Director,  during any inquiry, discovers the failure of the RE  or its designated director on the Board or any of its employees with regard to compliance with the obligations,  he can take the following actions without prejudice to any other action that might be taken under any other provisions of this Act.<\/p>\n\n\n\n