Anti money laundering is a process of laundering of money like a washer man who launders clothes. In another words it is converting an illegally obtained money into a legitimate money.it is conversion of money so as to make it appear to originate from legitimate source. There are three important independent steps in money laundering
a) placement
b) layering
c)integration
money is firstly placed or physically disposed which has been derived from illegal sources. Layering is done thereafter by creating fictitious transactions so as to conceal the same from eyes of law enforcement agencies.Integration is the last stem thereby laundered money is re injected in the economy.
Anti money laundering act has been enacted in India with an aim to prevent, combat and control money laundering. It allows law enforcement agency to confiscate and seize the property obtained from laundered money.Whosoever commits this act shall be punished with a rigorous punishment term of not less than 3 years and may extend up to 7 years along with fine of which may extend up to Rs5 lacs.
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