New AML Requirements in Thailand

Thailand’s cabinet has approved a draft regulation to foster stronger scrutiny of customers’ source of funds for Thai businesses most vulnerable to money laundering exploitation.

The Bangkok Post reports that the draft regulation “requires financial institutions and business operators as listed under Section 16 of the Anti-Money Laundering Act to assess their customers’ activities to reduce the risk of money laundering and/or terrorist financing“.

The new law was proposed after Thailand failed to meet the International Standard for Anti-Money Laundering and Combating the Financing of Terrorism (AML/CFT), especially in regards to the number of sectors and business activities required to comply with AML regulations.

Under the new regulation, not only banks but also investment consultants, gem and gold traders, real estate brokers, electronic payment service providers, antique traders, and non-bank credit companies will be required “to suspend business transactions with customers whose financial activities are deemed suspicious, and report them to Amlo”.

Deputy government spokeswoman Rachada Dhnadirek announced that, for cross-border wire transfers exceeding 50,000 baht (approximately €1,350), “both the ordering and the recipient institution will be required to obtain information about the origin of the funds, as well as both the sender and recipient”.

Thailand is only the latest addition to the list of jurisdictions that have recently introduced new regulations to expand the scope of AML requirements well beyond the traditional banking sector. While in Europe the new direction is exemplified by the Fifth Anti-Money Laundering Directive (AMLD5), in Asia similar changes have taken place in both Hong Kong and Singapore.

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