Financial Crime World

Saudi Arabia’s Regulatory Bodies Crack Down on Money Laundering: AML Compliance in the Kingdom

In the Kingdom of Saudi Arabia, several regulatory bodies are leading the charge against Money Laundering (ML) and Terrorist Financing (TF), ensuring the Saudi financial sector abides by international regulations.

Regulatory Bodies in Saudi Arabia

  1. Saudi Arabian Monetary Authority (SAMA) SAMA, as the country’s central bank, plays a crucial role in Saudi Arabia’s AML regulatory landscape. Its responsibilities include:

    • Setting the tone for AML regulations by issuing rules and instructions
    • Implementing standards
    • Supervising financial institutions’ compliance with these regulations

  2. Supreme Committee for Combating Money Laundering and Terrorist Financing (SCTF) SCTF’s role includes implementing AML policies and supervising compliance across the kingdom. It is responsible for:

    • Developing policies, guidelines, risk assessments, and audits
    • Ensuring adherence to regulations

  3. Ministry of Justice (MOJ) The MOJ provides practical guidance to entities subject to AML regulations. It issues manuals and guidelines for implementing AML regulations effectively.

  4. Grant Thornton Saudi Arabia Though not a regulatory body, Grant Thornton offers valuable resources and assistance to businesses and CFOs navigating the complexities of AML regulations in Saudi Arabia.

Money Laundering Offenses in Saudi Arabia

While money laundering is not explicitly defined in Saudi Arabia’s Cabinet Decision No. 80/1439, related offenses are recognized. These include:

  • Converting, transferring, or engaging in activities involving crime proceeds
  • Concealing their source
  • Attempting to aid or encourage money laundering

The Anti-Money Laundering Law (AML Law)

The AML Law forms the backbone of Saudi Arabia’s AML framework. Its provisions make money laundering offenses punishable by:

  • Up to ten years in prison and a five million riyal fine for Saudi nationals
  • Up to fifteen years in jail and a seven million riyal fine for non-Saudis
  • Expulsion from the kingdom after serving the sentence for foreign offenders

Regulations Overseen by SAMA

Some of the significant regulations overseen by SAMA include:

  • Banking rules and regulations
  • Financial institutions supervision
  • Consumer protection
  • Anti-Money Laundering and Counter-Terrorist Financing rules
  • Internal control manuals
  • Risk-based inspection policies

These regulatory bodies work relentlessly to uphold Saudi Arabia’s commitment to international standards and conventions for combating money laundering and terrorist financing. With the financial sector constantly evolving, their importance in maintaining the integrity of the financial system continues to strengthen.