Source: BS
Context: To further tighten its control of practising accountants, the Centre has brought within the ambit of the PMLA their “financial transactions”.
What are the new rules?
- Chartered accountants, company secretaries, etc., will now be required to go through the Know Your Company (KYC) process before commencing work.
- This implies accountants are now reporting entities if they are managing their clients’ money.
Significance: The move aims at curbing fraudulent practices by which accountants allegedly help their clients to launder money.
Need: The efforts are being taken ahead of the assessment of India under the Financial Action Task Force (FATF) – a global regulator that assesses country compliance in tackling global money laundering and terror financing.
What does the PMLA say about reporting entities?
They are required to maintain a record of all transactions and furnish them to financial intelligence units (FIUs).
