PMLA coverage of accountants, CS to increase scrutiny

The finance ministry's decision on Wednesday to include specific transactions conducted by accountants and company secretaries under the PMLA, or Prevention of Money Laundering Act, is expected to heighten their accountability and liability.

- Gireesh Chandra Prasad

The move will alter the way they do due diligence of transactions, source of funds examination, and reporting of irregularities, experts said.

The government has designated chartered accountants, cost accountants and company secretaries as reporting entities under the PMLA. Till now, PMLA covered entities such as financial institutions, including banks, operators of games of chance, casinos, real estate agents as well as dealers of precious metals. On Friday, ICAI, the accounting rule-maker, said it will cooperate with the Centre and raise awareness among all its members about the responsibilities.