How illicit money is laundered, and the legal tools used to combat organised financial crime in India.
Money laundering is the process of disguising the origins of illegally obtained money so it appears to come from a legitimate source — typically involving three stages: placement (introducing illicit funds into the financial system), layering (obscuring the money's origin through complex transactions), and integration (reintroducing the "cleaned" money into the legitimate economy).
India's principal anti-money-laundering law, empowering the Enforcement Directorate (ED) to investigate money laundering offences, attach and confiscate proceeds of crime, and prosecute offenders. The law has faced scrutiny over its stringent bail provisions and broad investigative powers.
Organised crime networks — spanning drug trafficking, human trafficking, arms smuggling, and extortion — often intersect with terrorism financing and political corruption, making them a significant internal security concern beyond ordinary law enforcement.
India is a member of the Financial Action Task Force (FATF), an international body setting global standards to combat money laundering and terrorist financing, and undergoes periodic assessments of its compliance with these standards.
Download this topic's notes as a PDF, or search uploaded materials.
