Powers and Role of Enforcement Directorate under Prevention of Money Laundering Act

ED was established under the department of Revenue, Ministry of Finance, the ED has been Pivotal in enforcing the PML Act 2002. Money laundering, being a complex and sophisticated crime, demands a multipronged approach and the ED plays a central role in combating the nexus.

During the financial years between 2012-13 and 2021-2022 the ED received total of 3985 complaints under the prevention of Money Laundering Act and 24893 under the civil law of the Foreign Exchange Management Act (FEMA) 1999

Powers and Role of the ED under PMLA:

  1. Investigating Money Laundering Offences: Primarily the ED dives into potential cases of Money Laundering for instance the infamous Nirav Modi and Mehul Choksi scam related to Punjab National Bank fraud was under ED’s radar for Money Laundering investigation.
  2. Attachment of Properties: If the ED identifies property involved in money laundering a provisional attachment can be made for 180 days, later the adjudicating authority can confirm this attachment for instance attaching Vijay Mallya’s properties in connection with Kingfisher Airlines loan default case.
  3. Search, Seizer and Arrest: The ED can carry out searches at suspected sites and arrest those believed to be involved for instance the recent arrest of Raj Kundra in an alleged money laundering case.
  4. Summoning individuals: To glean deeper insight into money laundering operations the ED can summon individuals to provide necessary records. Prominent personality like Robert Vadra has been summoned to provide clarifications related to specific cases.
  5. International cooperation: The ED’s collaborate investigations with international bodies has borne fruit such as extradition efforts for Vijay Mallya from the UK.


Issues with ED and PMLA:


  • Misuse of PMLA for ordinary crimes: PMLA is used to investigate crimes not related to money laundering or organised crime, leading to the attachment of assets of genuine victims.
  • Lack of transparency and clarity: In enforcement cases information report is not given to the accused and the ED lacks clarity in selecting the cases to investigate.
  • Blanket powers: The ED has been assigned almost blanket powers under PMLA for searching, seizing, investigating and attaching the assets considered to be proceed of the crime. These powers include

Under section 17 to enter and search any premises

Under section 18 to seize documents and other evidences

Under section 37 to freeze bank accounts

Under section 50 to summon and question any person

ED’s powers are not subject to any restrictions as those of police and it can initiate investigations without warrant or prior approval of the court.

  • low conviction rate: Between 2005 to 2014 there was zero conviction and between 2014. To 2022 only 23 cases were under conviction out of 888 cases registered.
  • Allegation of Political bias: Recently ED is investigating high profile cases including the Rafale deal and allegations of corruption against former CM of Karnataka, B,S, Yeddyurappa. In some cases, ED’s investigation has been criticised for being politically motivated



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