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CMA Final · Corporate and Economic Laws · Laws and Regulations related to Anti-Money Laundering

Mehta received cash that he knew was derived from a scheduled offence, held it for two years, and continues to enjoy it by projecting it as lawful income. Which statement is correct under section 3 of the PMLA, 2002 as clarified by its Explanation?

Money-laundering is a continuing activity. It continues until the person is directly or indirectly enjoying the proceeds of crime through concealment, possession, acquisition, use, or projecting or claiming it as untainted property. Any one of these processes suffices, so Mehta's ongoing enjoyment keeps the offence alive.

  1. AThe offence ended when the property was first acquired
  2. BThe offence is complete only if all of concealment, possession, acquisition and use are proved together
  3. CThe activity is continuing and continues until the person is directly or indirectly enjoying the proceeds by concealment, possession, acquisition, use, or projecting or claiming it as untaintedCorrect
  4. DThe offence arises only if the person is also the one who committed the scheduled offence

Explanation

The Explanation states the processes are alternative (concealment or possession or acquisition or use or projecting or claiming as untainted) and that the activity is continuing until the person stops enjoying the proceeds in such ways. So it is neither a one-time act nor a cumulative requirement.

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