NOTE ON ANTI MONEY LAUNDERING AND COMBATING FINANCING OF TERRORISM
A.  Background of Prevention of Money Laundering Act

The Department of Revenue, Ministry of Finance, Government of India has put in place and brought into force the Prevention of Money Laundering Act, 2002 (‘the Act’) w.e.f. July 1, 2005. Money laundering involves disguising financial assets so that they can be used without detection of the illegal activity that produced them. Through money laundering, the launderer transforms the monetary proceeds derived from criminal activity into funds with an apparently legal source.

Any act of concealing the transformation of profits from illegal activities and corruption into ostensibly "legitimate" assets, implementing such strategies is generally called money laundering.

Any intermediary associated with the securities market and registered under Section 12 of the Securities and Exchange Board of India Act, 1992 (SEBI Act) shall have to adhere to the guidelines issued in terms of the Act and to take all necessary actions to implement provisions/ requirements of the Act.

Actions that may be initiated against person laundering money?

The following actions may be initiated against persons involved in Money Laundering :

  • 1) Attachment of property, seizure/freezing of property and records.

  • 2) Imprisonment for a term which shall not be less than three years but may extend up to seven or even ten years (depending on circumstances) and shall also be liable to fine (no upper limits prescribed)

B.  Responsibility of clients/investors in fulfilling obligation under the Act
  • a) No benami account should be opened. Open accounts in your own name, do not act as a front face for any other person including your relatives/ friends/ employers etc. Please provide correct details along with supporting evidence for carrying out Know Your Client ("KYC")

  • b) Ensure that the funds and securities used in any transaction are actually and beneficially owned by you, all transfers must be done from the registered bank and depository account(s) held in your name only.

  • c) Change in Demographic details should be immediately informed to Bajaj Capital Limited.

  • d) Assist Bajaj Capital Limited in carrying out Due diligence process smoothly by providing your source of income/financial/any other details as may be sought by Bajaj Capital Limited from time to time. Any failure on your part to provide such details may lead to further investigation.

Should you require more details with respect to the Act, you are requested to visit website of Financial Intelligence Unit – India  https://fiuindia.gov.in/