ED flags legal hurdles in money laundering probe

NEW DELHI: Striking a tough note, Enforcement Directorate on Friday raised the issue of legal obstacles coming in the way of the agency, with its chief Rahul Navin questioning the proposition that an investigation into a money laundering offence should not proceed until the trial in the predicate offence case had been concluded.

“Of course, there are legal challenges before the courts, the most important being whether the trial in money laundering cases should take a pause till the trial in the predicate offence case gets concluded or continue on a standalone basis in consonance with the international standards and Financial Action Task Force Guidelines,” ED chief said.





His remarks on the occasion of the agency’s 70th Foundation Day and in the presence of minister of state for finance, Pankaj Chaudhary, are likely to sharpen the raging debate on whether the investigation into money laundering offence has to necessarily ride piggyback on predicate offence; that is the crime which generated the money that was laundered, or does it have, given the enormity of money laundering, an independent existence.

The matter is in a zone of ambiguity as while the Supreme Court in Vijay Madanlal Choudhary case tied the money laundering probe to predicate offence, there are high court verdicts which have recognised money laundering as a standalone offence.

Navin said that the ambiguity was hindering ED’s work despite its success in achieving a conviction rate of 94%. In his remarks, additional solicitor general S V Raju, who represents the agency in constitutional courts, agreed with the ED director.

The ED chief also expressed confidence that the agency will maintain its “strike” in more than 2,400 cases now pending before trial courts, leading to confiscation of a sizeable amount as proceeds of crime. The celebrations were significant in that they brought out govt’s solidarity with the agency that has been accused of being an instrument of political vendetta.

“Over the last few years, the ED has remained a subject of extensive public discourse. There exists an ecosystem in the country that perceives a problem in every solution. No matter what you do, such people will inevitably start finding fault with it. In reality, ever since Modiji assumed the nation’s leadership in 2014, and began taking tough decisions in the national interest, the very foundations of this ecosystem have been shaken,” the junior finance minister said.

Speaking on ED’s legal challenges, S V Raju said the present understanding of the law is that the predicate offence is like an “umbilical cord” to the money laundering crime, but, he emphasised that the discharge of an accused or a closure report filed in a predicate offence should not end the ED’s investigation as the agency can always share fresh evidence and challenge the ruling as an “aggrieved” party.

At the award giving later, two assistant director rank officers of ED—Vikram Ahlawat and Prashant Chandila—were among several others who received their commendation certificates.

Ahlawat and Chandila werepart of the Jan 8 searches in Kolkata on political consultancyfirm I-PAC. The searches weredisrupted by CM Mamata Banerjee and her senior police officers.