One of the initiatives taken by the international community to obviate the threat was the Financial Action Task Force (FATF). It made 40 recommendations that provided the foundation for comprehensive legislation to combat the problem of money laundering. As a result, the Prevention of Money Laundering Act, 2002 (PMLA) emerged in 2002.
Arming the Directorate of Enforcement (ED) with the authority to trace and seize properties derived from criminal proceeds, PMLA had the potential to be a game-changer. However, in its initial years, the Act’s enforcement remained lackluster and lifeless. The amount of assets recovered/seized up to 2014 was a mere ₹35 crore.
But as time passed, the tables began to turn, and PMLA’s implementation grew increasingly stringent and uncompromising, causing ripples of fear and panic. Suddenly, the accused found themselves staring down the barrel of this stringent law, facing the terrifying prospect of having their properties attached and their freedom stripped away on the whims of power authorities. The seizure of ‘proceeds of crime’ just did the trick. The rapacity at which ED attached properties sent shivers down the spines of people looting money through sophisticated white-collar crimes.
Amidst the chaos, innocent individuals became ensnared in PMLA’s ruthless grip, their lives upended by baseless harassment and unjust persecution. The pendulum swung from one extreme to another.
Source: Barandbench
