The Prevention of Money Laundering Act (PMLA) has been a powerful tool in combating financial crimes in India. Several landmark cases have helped shape the interpretation and enforcement of this legislation. This article highlights some crucial cases that put a spotlight on the complexities and evolving jurisprudence around PMLA. 1. Vijay Madanlal Choudhury v. Union…
A Bill of exchange is a written, unconditional order by one party (the drawer) to another party (the drawee) to pay a specified sum of money to a third party (the payee) at a predetermined date or on demand. The bill of exchange serves as a promise to pay and acts as a credit instrument,…
A negotiable instrument like a cheque, bill of exchange, or promissory note is called a forged instrument when forgery takes place in the signature of the drawer, the signature of the endorser, alteration in name of the payee, alteration in amount, alteration in date, etc. If the forged endorsement is a nullity, then it will…
A banker collects a cheque for his customer in the capacity of an “agent for collection”, the banker collects the cheque on behalf of his customer, which also when presented to him. If a customer gives an open cheque i.e. a cheque uncrossed, the banker has to cross the cheque before it is sent for…
Section 15 of NI Acts 1881 defines endorsement (Indorsement) as under When the maker or holder of a negotiable instrument signs the same, otherwise than as such maker, for the purpose of negotiation, on the back or face thereof or on a slip of paper annexed thereto, or so signs for the same purpose a…
Although, there are several cheque bounce reasons to be considered such as incorrect date mentioned on the cheque, signature mismatch, mismatch of the amount and figures, damaged cheque, overwriting of the cheque, etc. The principal reason for a cheque bounce is insufficient funds. If a cheque is dishonoured because of insufficient funds in the payer’s…
Under the Negotiable Instrument Act a cheque is a bill of exchange it is an order on the drawee bank to pay the amount specified in it to the payee or the bearer until and unless the amount mentioned in the cheque is paid, the disposition of property therein will not take place. Section 19…
Maintaining client identity records is a core compliance obligation for banks and financial institutions under the Prevention of Money Laundering Act (PMLA). This requirement is designed to promote transparency, accountability, and support for law enforcement in the fight against money laundering and financial crimes. What Records Must Be Maintained Banks and financial institutions must maintain…
In today’s banking environment, verifying client identity under the Prevention of Money Laundering Act (PMLA) is more than a regulatory requirement—it is a cornerstone of financial integrity. By ensuring robust identity verification and record-keeping, banks not only comply with the law but also safeguard themselves against criminal misuse, build customer trust, and strengthen the resilience…
Under the Prevention of Money Laundering Act (PMLA), reporting entities are required to furnish transaction and client-related information to the Director, Financial Intelligence Unit – India (FIU-IND), through procedures defined in consultation with their regulators. Typically, this process is handled via the institution’s Principal Officer, who acts as the nodal point for compliance. Strict timelines…