KATHMANDU: Constitutional expert Bipin Adhikari has raised serious concerns over the interpretation and enforcement of Nepal’s anti-money laundering law, warning that misuse and conceptual confusion could lead to injustice.

In a recent statement, Adhikari questioned whether administrative bodies in Nepal properly understand the legal framework governing money laundering. He cautioned that there is a growing risk of “overreach” in applying the law, particularly in cases where the foundational crime—known as the predicate offence—is not clearly identified.

According to him, emerging patterns in media reports suggest that, in several instances, authorities have proceeded with money laundering allegations without clearly establishing the underlying criminal offence. This, he argued, reflects a deeper conceptual ambiguity in how the law is being interpreted.

Adhikari emphasized that for a case to qualify as money laundering, the assets in question must be proven to be “criminal proceeds.” Moreover, there must be clear evidence of intent to conceal, disguise, or legitimize such assets under the law. Simply possessing large sums of money, making accounting errors, committing minor tax violations, using cash, or seeking financial privacy does not, by itself, constitute money laundering, he noted.

He further clarified that ownership of property alone is insufficient to trigger money laundering charges. Instead, authorities must demonstrate that the assets were derived from criminal activity and that there was a deliberate attempt to hide or transform their origin to make them appear lawful.

The legal expert warned that ambiguity arises when key elements are not distinctly established—such as failing to identify the predicate offence, not tracing or categorizing illicit proceeds separately, or not clearly distinguishing laundering activities from the original crime. He also criticized the vague use of terms like “dirty money” without adequately explaining how such usage goes beyond mere possession or consumption of illicit gains.

Adhikari stressed that without a clear legal distinction between the predicate offence, the proceeds derived from it, and the alleged laundering actions, the application of the law cannot remain fair, consistent, or balanced.

Highlighting the risks of weak prosecution, he said that poorly prepared cases could cause unnecessary hardship to the public, while forcefully pursuing weak or non-viable cases could harm innocent individuals.

“There is no substitute for proper case preparation,” he underscored, warning that both underprepared and unjustified prosecutions could undermine public trust and the rule of law.