Demystifying the Money Laundering Act : Between Enforcement and Rights

Money laundering poses a serious threat to the integrity of financial systems and democratic institutions, especially in developing economies like India. The Prevention of Money Laundering Act, 2002 (PMLA) , enacted in line with India’s obligations under the Financial Action Task Force (FATF) , forms the backbone of the country’s anti-money laundering regime. This article examines the evolution of the PMLA, analysing its core provisions, enforcement mechanisms, and judicial interpretations through landmark cases such as Vijay Madanlal Choudhary v. Union of India and Nikesh Tarachand Shah v. Union of India . It critically evaluates the reversal of the burden of proof, stringent bail provisions, and expanding powers of the Enforcement Directorate (ED). The article also explores procedural challenges in prosecuting predicate offences and tracking proceeds of crime in light of emerging threats like cryptocurrency and cross-border flows. It concludes by emphasising the need to balance effective enforcement with constitutional safeguards and global best practices.