Practicing professionals as reporting entities under PMLA

Ministry of Finance notification notifies certain client transactions by CA, CS and CMAs for money laundering law

The Ministry of Finance vide notification dated May 03, 2023 (‘Notification’) has widened the ambit of the term “Reporting Entity” as defined in Section 2(1)(wa), read with sec. 2 (1)(sa) of the Prevention of Money Laundering Act, 2002 (‘PMLA’). The Notification, which has already created a lot of flutter, seems to bring practising corporate professionals (CAs, CSs, CMAs), if the said corporate professionals are carrying certain “financial transactions” on behalf of their clients. At its first reading, one may either take a very aggressive view, to regard all practising corporate professionals as being “reporting entities”. However, a finer reading suggests that only such professionals, who are carrying specified financial transactions on behalf of their clients, are covered as reporting entities. Read our write-up on the topic - https://vinodkothari.com/2023/05/prac...