Financial Crime World

Kuwait’s Anti-Money Laundering and Counter-Terrorist Financing Measures: An Evaluation

Mohammed Ahmad Naheem

Introduction

Kuwait, with over 9% of the world’s oil reserves and an $110 billion economy, has been making persistent efforts to strengthen its internal financial protection mechanisms and comply with international standards against money laundering and terrorist financing (ML/TF). In this article, we offer an in-depth analysis of the Gulf state’s legislative, regulatory, and enforcement structures to combat ML/TF activities.

Kuwait’s legal framework is the foundation of its stance against ML/TF. Some of the significant legislations include:

  • The Money Laundering Control Law No. 34/2010
  • The Counter-Terrorist Financing Law No. 16/2014

This section provides an overview of these laws.

Regulatory Bodies

There are several regulatory bodies in Kuwait responsible for implementing and enforcing the ML/TF laws. They include:

  • Central Bank of Kuwait (CBK)
  • Public Authority for Monitoring and Combating Money Laundering and the Financing of Terrorism (PACMLFT)

This section delves deeper into the mandate and functions of these bodies.

Progress and Challenges

Kuwait has taken significant strides in recent years to improve its ML/TF infrastructure. This section assesses the current state of Kuwait’s ML/TF efforts, focusing on the following:

  1. Legal and regulatory framework
  2. Institutional structure
  3. Risk assessment and targeted financial sanctions

Despite progress, there have been some deficiencies, particularly in reporting and external publishing administration, which have yet to be fully addressed.

Role of International Evaluations

International evaluations serve as an independent source of information regarding Kuwait’s progress in implementing ML/TF regulations. This section discusses the importance of these evaluations and their role in revealing the country’s current strengths and weaknesses. The evaluations offer valuable insights and recommendations for improvement.

Conclusion

The article concludes by reiterating the importance of Kuwait’s efforts to create a robust anti-money laundering and counter-terrorist financing system given its strategic location in the Middle East and its role as an integral part of the global energy trade. Despite challenges, the country’s ex post approach to the Financial Action Task Force’s recommendations and improving enforcement mechanisms indicate its commitment to creating a strong financial system parallel to international standards.