Context
The Enforcement Directorate (ED) registered 1,080 cases under the Prevention of Money Laundering Act (PMLA), 2002 in FY2025-26, the highest in four years. However, the conviction rate remains low despite an increase in investigations and prosecutions.
Explanation
- The Prevention of Money Laundering Act (PMLA), 2002 aims to prevent money laundering, confiscate proceeds of crime, and combat financing of illegal activities.
- Money laundering is the process of disguising illegally obtained money as legitimate through placement, layering, and integration.
- The Enforcement Directorate (ED), under the Department of Revenue, Ministry of Finance, is the primary agency for investigating offences under PMLA and attaching illegally acquired assets.
- PMLA investigations are initiated based on a scheduled (predicate) offence listed in the Act.
- The Act empowers the ED to search, seize, arrest, attach property, and file complaints before Special PMLA Courts.
- India is a member of the Financial Action Task Force (FATF), whose anti-money laundering standards guide the country’s legal and institutional framework.
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