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Anti-money laundering legislation

In light of the proliferation of illicit activities involving large sums of money, the legislature of Thailand passed a comprehensive anti-money laundering law. The Anti-Money Laundering Act was enacted in March 1999 to eradicate drug trafficking and other activities such as corruption, fraud, and prostitution.

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Anti-Money Laundering Law in Thailand

Fighting Against Money Laundering under Thai Law

In March 2008, the law was amended to broaden criminal liability, enhance the powers of investigation and seizure, and address potential corruption within the government. The Anti-Money Laundering Office (AMLO), established by the Act, acknowledged the support of financial institutions in reporting potentially illegal transactions.

However, it was noted by AMLO that the number of mandatory reporting transactions under the Act has significantly decreased over time, indicating that suspicious transactions previously made through reputable financial institutions are now being divided into smaller amounts or conducted through other means.

Targeted Crimes

The initial purpose of the money laundering law was to address the transfer of funds and assets from drug trafficking and to comply with the requirements of the Convention. The rule was finalized and amended in March 2008, adding a list of criminal offenses, which currently include:

Drug distribution

  • Prostitution and related sexual offenses
  • Public Fraud
  • Fraud involving financial institutions
  • Misuse of power by public officials
  • Extortion
  • Smuggling trade
  • Gambling offenses are specified in gambling laws, especially large-scale gambling.

Act Provisions

The Act prohibits transferring, converting, or receiving funds or assets from the listed criminal offenses to conceal their source. The Act defines offenders as those who commit or attempt to commit money laundering or are complicit in such actions. The punishment can be up to 10 years in prison and a fine of up to 200,000 baht. The March 2008 amendments included provisions for corrupt government officials, with doubled penalties for the principal and accomplices if they were government officials.

The Act also enables a thorough investigation of banking transactions and other relevant financial transactions, granting law enforcement officials the power to seize, without a warrant, money or property connected to one of the listed criminal offenses. To recover seized property, the owner must provide sufficient evidence showing that it is not related to the commission of a listed offense or any money laundering offense.

Registration Requirements

The Act requires banks and other financial institutions to report cash transactions exceeding 2 million baht and real estate transactions over 5 million baht, requiring clients to provide a detailed record. This requirement is left to the financial institution's discretion to balance privacy concerns and compliance with the Act. AMLO has also introduced a need for individuals entering or leaving Thailand to declare the amount of currency they hold. Failing to comply with these reporting requirements results in a fine of up to 300,000 baht. Filing a false report can result in a fine of up to 500,000 baht and up to two years in prison.

 

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Update: 12-02-2023
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