Tax crimes to be 'predicate offence'
YESTERDAY DDT reported that the Task Force had recommended 'tax crimes' to be made a predicate offence so that action can be taken under Prevention of Money Laundering Act, 2002.
Many people asked me what a predicate offence was.
Article 6, paragraph 2 (a), of the UN Organized Crime Convention requires that the provisions concerning money-laundering are applicable to the “widest range of predicate offences”, including the offences established by the Convention itself and the Protocols to which the State has become a party, as well as all “serious crime"(art. 6, para. 2 (b)) as defined bythe Convention.
A "predicate offence" is an offence whose proceeds may become the subject of any of the money-laundering offences established under the Convention. Many States already have laws on money-laundering, but there are many variations in the definition of predicate offences. Some States limit the predicate offences to drug trafficking, or to drug trafficking and a few other crimes. Other States have an exhaustive list of predicate offences set forth in their legislation. Still other States define predicate offences generically as including all crimes, or all serious crimes, or all crimes subject to a defined penalty threshold.
The united Nations Convention against Transnational Organized Crime defines it: "Predicate offence" shall mean any offence as a result of which proceeds have been generated that may become the subject of an offence as defined in article 6 of this Convention.
Article 7 of the Organized Crime Convention requires States parties to take these measures.
They must:
1. Establish a regulatory and supervisory regime for banks and non-bank financial institutions, emphasizing requirements of customer identification, record-keeping and the reporting of suspicious transactions
2. Develop the capacity of administrative, regulatory, law enforcement and other authorities to cooperate and exchange information with each other
3. Promote global, regional, sub-regional and bilateral cooperation among judicial, law enforcement and financial regulatory authorities
4. Use as a guideline the relevant initiatives of regional, interregional and multilateral organizations against money-laundering
They are also required:
1. To consider implementing measures to detect and monitor movements of cash and negotiable instruments across their borders, such as reporting requirements for substantial cross-border cash transfers
2. To promote cooperation among the national authorities established to combat money-laundering