📈 Sri Lanka Toughens AML Laws: Real Estate & Tax Evasion Targeted

Sri Lanka is set to significantly expand its anti-money laundering (AML) framework through proposed amendments to the Prevention of Money Laundering Act, aiming to align with global Financial Action Task Force (FATF) standards ahead of its next mutual evaluation. • New Predicate Offence: Wilful tax evasion under the Inland Revenue Act will now officially become a predicate offence for money laundering. Officials clarified this applies strictly to deliberate criminal evasion, not ordinary tax disputes. • Impact on Property & Assets: The definition of money laundering will expand to cover the use, purchase, conversion, and beneficial ownership of criminal proceeds. For property investments linked to crime, buyers must prove in court that they acquired the asset in good faith without prior knowledge of its origin. • Strengthened Enforcement: - Asset-freezing powers for investigators will double from 7 days to 14 working days before requiring a High Court order. - A newly proposed Proceeds of Crime Management Authority will oversee and manage confiscated assets during legal proceedings. Confiscated properties will eventually be sold, with proceeds channeled into the state's Consolidated Fund. _Note: Based on proposed legislative amendments currently before Parliament._