The Prevention of Money Laundering Act 2002 (PMLA) requires regulated entities to implement measures for identifying and reporting suspicious transactions to the Financial Intelligence Unit of India (FIU-IND).
According to AML regulations, a “suspicious transaction” is defined as any transaction that involves proceeds of crime, is unnecessarily complex, lacks a legitimate business rationale, or is suspected to be linked to terrorism financing.
If a transaction is deemed suspicious, the Principal Officer of the entity is obligated to report it to the FIU-IND, regardless of the transaction amount or whether it was conducted in cash.
Once a transaction is identified as suspicious, it must be reported promptly to FIU-IND through a Suspicious Transaction Report (STR).
An informative visual guide outlines the key elements of suspicious transactions under PMLA that every regulated entity should be aware of.
NIYEAHMA Consultants LLP is a global AML consultancy firm that assists regulated entities in India with PMLA compliance through its division, AML India. AML India helps regulated entities establish customized AML compliance frameworks and provides training for the effective implementation of AML policies and procedures, including the timely reporting of identified suspicious transactions to the FIU-IND.