Financial Crime World

Thailand Cracks Down on Financial Crimes: Tougher Penalties and Expanded Anti-Money Laundering Law

Strengthening Thailand’s Anti-Money Laundering Regulations

Thailand’s legislative body has reinforced its anti-money laundering laws with the Anti-Money Laundering Act of 1999, an important step in combating illegal activities with substantial financial gains, such as drug trafficking, corruption, fraud, and prostitution.

Initial Objectives and Covered Offenses

The primary objective was to tackle the transference of money and assets from the illegal drug trade. The Act covers criminal offenses including those related to:

  • Drug trafficking
  • Prostitution
  • Fraud
  • Abuse of power
  • Extortion
  • Contraband items
  • Gambling (specifically large-scale gambling games)

Criminal Offenses and Punishments

The Act stipulates it is a criminal offense to transfer, convert, or receive the transfer of funds or property originating from these offenses to mask their sources.

  • Individuals: Imprisonment of up to 10 years and fines of up to 200,000 baht
  • Government officials: Doubled fines under March 2008 amendments

Enforcing Investigations

The Thai Anti-Money Laundering Prevention and Suppression Office (AMLO) has experienced cooperation from financial institutions for reporting suspicious transactions. However, the number of transactions reported has decreased over time, possibly indicating smaller transactions or alternative avenues.

Enhanced Investigation Powers

To conduct thorough investigations, the Act grants enforcement officials the power to seize:

  • Money
  • Property

linked to the listed criminal offenses without a warrant. Property owners attempting to recover their seized assets must provide substantial evidence proving their assets’ complete separation from the aforementioned crimes or money laundering activities.

Reporting Requirements and Penalties for Non-Compliance

The Act requires financial institutions to report:

  • Cash transactions exceeding 2 million baht
  • Property transactions surpassing 5 million baht

Penalties for non-compliance include fines of up to 300,000 baht and false reporting can lead to fines of up to 500,000 baht and imprisonment for up to two years.