Cambodia Introduces Stricter Anti-Money Laundering Regulations

The Cambodian government has recently introduced new anti-money laundering (AML) regulations aimed at strengthening the country’s efforts to combat financial crimes.

Enhanced Due Diligence Measures

Under the revised AML/CTF Law, which came into effect in 2020, officials and members of international organizations must pay special attention to transactions conducted by politically exposed persons. This includes family members and close associates of such individuals.

• Reporting entities, including banks, financial institutions, and other businesses, are required to exercise due diligence in their activities.
• Large cash transactions and suspicious activities that exceed a certain threshold must be reported.
• Enhanced customer due diligence measures will be implemented for high-risk customers, which may include:
  • Obtaining additional information on customers’ identification
  • Source of funds
  • Transaction purpose
  • Business relationship

Expanded List of Reporting Entities

The list of reporting entities has been expanded to include:

• Trustees
• Institutions designated by the Cambodian Financial Industry Union (CAFIU)
• Professions designated by CAFIU

Increased Penalties for Non-Compliance

Penalties for non-compliance have been increased, with fines doubled and prison terms extended. Legal entities found guilty of money laundering can face:

• Fines up to KHR 1 billion ($245,500)
• Imprisonment from two to five years

Goals of the Revised Law

The revised law aims to strengthen Cambodia’s AML/CTF regime and align it with international standards. It is expected to improve the country’s financial transparency and reduce the risk of money laundering and terrorist financing.

By implementing these stricter regulations, Cambodia is taking a significant step towards enhancing its financial system and protecting against financial crimes.