A Tougher Law, A Bigger Test

The government has taken steps to tighten control over financial crime by granting the Department of Money Laundering Investigation (DoMLI) additional jurisdiction under a new regulation. This modification to the Asset (Money Laundering) Prevention Act of 2008 alters how investigations are conducted, allowing DoMLI to examine a broader range of cases and operate more independently. One of the most significant changes is the removal of the previous requirement that money laundering charges be linked to a specific underlying offense. Investigators may now proceed even if the predicate offense has not yet been identified. The restructuring also addresses a long-standing gap in Nepal's enforcement system. Until now, more than 40 separate agencies—including the police, customs, tax authorities, forest offices, and anti-corruption bodies—could independently initiate money laundering investigations. In theory, this suggested stronger enforcement. In practice, it created confusion, overlap, and uneven accountability. Institutions often worked in parallel, weakening overall responsibility.The new law re-centralizes that authority under DoMLI while broadening the range of offenses that may trigger investigations. Smuggling, tax evasion, customs and excise violations, and both direct and indirect tax offenses now clearly fall within its scope. The legislation also focuses more directly on financial market misconduct. Insider trading, market manipulation, banking fraud, foreign exchange offenses, insurance fraud, and abuse of financial instruments are now explicitly included as punishable offenses.