Money laundering

Money laundering is illegal movement of money from once place or account to another, or when such transfer is done to escape and evade taxes. Such movement of money is used to fund variety of purposes including terrorism. Due to this, governments across the world are trying to stop such transfers.

Preventive steps

In India, Prevention of Money Laundering Act deals with the subject and a lot of steps and guidelines are given to comply with the Act. As far as investors are concerned, they have to comply with various guidelines like ‘know your client’ norms while investing.

Documentation process

Slowly the ambit of the items covered under this area has been increasing and additional areas are being brought under its cover. For investors this means the role of additional documentation as far as the investment process is concerned.

Legal requirement

In future some more areas including credit cards and moneychangers might be brought under the net. Players in this field will have to report suspicious transactions in these areas.