Adjudication [Section

18.8

Powers of Director to impose fine [Section 13] No civil or criminal proceedings against reporting entity [Section 14] Procedure and manner of furnishing information by reporting entities [Section 15]

- To verify the identity of its clients in prescribed manner. - Every information maintained, furnished or verified as above shall be kept confidential. The records mentioned above shall be maintained for 5 years from the date of transaction. The Central Government has a power to exempt any reporting entity from the provisions of this section. Director can call the records from the bank, financial institutions and intermediary. If the Director finds that the bank, financial institutions and intermediary has not complied with the provisions of Section 12, he can impose fine of ` 10,000 to ` 1,00,000.

If the bank, financial institutions and intermediary supplies the information, no civil proceedings can be taken against them for furnishing information to Authority.

The Central Government in consultation with the RBI may prescribe the procedure and the manner of maintaining and furnishing information by a reporting entity for the purpose of implementing the provisions of the Act.

PAST EXAMINATION QUESTIONS Question 1: Mention the provisions of the Prevention of Money Laundering Act, 2002 regarding the obligations of banking companies, financial institutions and intermediaries. [Dec. 2007 (5 Marks)] [Dec. 2011 (5 Marks)], [June 2016 (5 Marks)]

Hint: Refer to Section 12 of the Prevention of Money Laundering Act, 2002.

Question 2: What information is required to be preserved by the banks under the Prevention of Money Laundering Act, 2002? Discuss also the process of maintenance and preservation of records by banks? [Dec. 2017 (5 Marks)]

Hint: Refer to Section 12 of the Prevention of Money Laundering Act, 2002.

Question 3: Which information should be preserved by the banks under Prevention of Money Laundering Act, 2002? [June 2021 (4 Marks)]

Hint: Refer to Section 12 of the Prevention of Money Laundering Act, 2002.

Question 4: Explain the obligations which have been imposed upon the banks to remain cautious under the Prevention of Money Laundering Act, 2002. [June 2021 (3 Marks)]

Hint: Refer to Section 12 of the Prevention of Money Laundering Act, 2002.

Power of survey [Section 16] SUMMONS, SEARCHES & SEIZURES

An authority has power to enter any place on having reason to believe that an offence of money laundering has been committed. Such authority can place marks of identification on the records inspected by him and make or cause to be made extracts or copies, make an inventory of any property checked or verified by him and record the statement of any person present in the place which may be useful for any proceedings under the Act.