FBR welcomes LHC ruling on money laundering cases

The Lahore High Court (LHC) has ruled that money laundering and taxation are separate legal matters, according to the Federal Board of Revenue (FBR). The court dismissed a petition challenging the Federal Board's authority to investigate money laundering cases independently, emphasizing that the two areas of law remain distinct.

The LHC held that the FBR's Directorate General of Intelligence & Investigation (I&I-IR) has full legal authority to register, investigate, and prosecute money laundering offences under the Anti-Money Laundering Act of 2010, without waiting for the conclusion of tax cases. The court ruled that money laundering involves dealing with illicitly obtained proceeds and disguising them to appear legitimate.

A person can be prosecuted for money laundering even without a prior conviction for the underlying offence. The judgment clarified that the Anti-Money Laundering Act takes precedence over general laws in relevant matters. The ruling also addressed suspicious transaction reports from banks to the Financial Monitoring Unit, stating that subsequent legal actions on these reports are lawful and subject to legal safeguards.

The FBR stated that the decision does not impact individuals who have declared their income and paid taxes, stressing that enforcement action must still adhere to due process and the rule of law.