What is PMLA?
PMLA stands for the prevention of money laundering. An act passed by the Indian parliament to curb the black money.The Prevention of Money Laundering Act (PMLA) became applicable in India on July 1, 2005. While the Act was enacted in 2002, it took a few years to develop the necessary rules and regulations for its enforcement. The July 1, 2005 date marked the point when the PMLA and its associated rules came into effect, allowing authorities to take action against money laundering activities.
The Prevention of Money Laundering Act (PMLA) has three main aims in India:
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Prevent and Control Money Laundering: This is the core objective. PMLA aims to stop the process of criminals disguising the source of their illegally obtained money. This discourages crime and protects the financial system from being used for illicit activities.
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Confiscate and Seize Property from Money Laundering: PMLA empowers authorities to identify and seize assets acquired through money laundering. This discourages criminals from profiting from their crimes and helps recover ill-gotten gains.
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Deal with Other Money Laundering Issues: The act goes beyond just tackling individual crimes. It also aims to address broader issues related to money laundering, such as establishing procedures for financial institutions to report suspicious activity and cooperating with international efforts to combat financial crime.
Under section 4 of PMLA an imprisonment form 3 to 7 years can be awarded with a fine.
Why Arvind Kejriwal is arrested?
He is arrested for changing the liquor policy so as to give benefit to some specific businesses. It is alleged that he made the liquor policy favouring the big players from south India. It is also alleged that he got the kickback in terms of black money from those businesses.
