Thailand tightens anti-money laundering measures after UN report

An OHCHR report alleged that Thai FIs provided services for arms procurement.

Thailand is enhancing its operational standards against money laundering and terrorism financing following a United Nations report alleging that its banks provided services for weapons procurement to foreign countries.

Amongst changes include more stringent measures to verify customers’ identity and intended purpose of financial transactions, and requiring clear evidence and additional information from high-risk customers, the Bank of Thailand (BOT) and Thailand’s Anti-Money Laundering Office (AMLO) said in a joint statement.

Financial institutions (FIs) are guided to establish criteria for requesting additional documentation for money transfer transactions including high-risk customers, especially transactions involving dual-use items.

BOT and AMLO expressed hopes that these measures will prevent Thai FIs “from being used as channels to support money laundering, terrorism, and human rights violations.”

The announcement comes in response to a report from the Office of the United Nations High Commissioner for Human Rights (OHCHR), which alleged that Thai financial institutions provided financial services related to the procurement of weapons by the Myanmar military government in 2023.

The weapons procured were used to harm civilians and violate human rights in Myanmar.

The AMLO and BOT maintained that no evidence was found linking Thai FIs to arm procurement, although their investigation found that some financial institutions did conduct transactions with individuals listed in the OHCHR report

The AMLO and BOT also noted that each of the financial institutions had “varying levels of rigor in their operations”. This reportedly highlighted the need to elevate key AML/CTPF practices, authorities said.

Separately, the AMLO and BOT issued a joint policy statement on sanctions-related risks oversight. This policy urges FIs to enhance their sanctions-related risk management and requires them to comply with the policy’s guidelines beginning 27 December 2024.

Authorities also required theThai Bankers’ Association, the Association of State Financial Institutions, and member banks to establish industry standards in areas that needed enhancements in operational practices, as identified by the authorities.

Industry standards include the development of systems and tools to effectively monitor Dual-Use Items (DUI) and products that have high risks of being used to produce weapons that threaten international security. These standards will be applied starting January 2025.