Countries/Jurisdictions of Primary Concern - Thailand
Thailand is a centrally located Southeast Asian country with an extremely porous border. Thailand is vulnerable to money laundering within its own underground economy, as well as to many categories of cross-border crime, including illicit narcotics and other contraband smuggling. Thailand is a source, transit, and destination country for international migrant smuggling and trafficking in persons, a production and distribution center for counterfeit consumer goods, and a center for the production and sale of fraudulent travel documents. The proceeds of illegal gaming, corruption, underground lotteries, and prostitution are laundered through the country’s financial system. The Thai black market includes a wide range of pirated and smuggled goods, from counterfeit medicines to luxury automobiles.
Money launderers and traffickers use banks, non-bank financial institutions, and businesses to move the proceeds of narcotics trafficking and other criminal enterprises. In the informal money changing sector, there is an increasing presence of hawaladars that service Middle Eastern travelers in Thailand. Thai and Chinese underground remittance systems are also prevalent.
For additional information focusing on terrorist financing, please refer to the Department of State’s Country Reports on Terrorism, which can be found at: //2009-2017.state.gov/j/ct/rls/crt/
Do FINANCIAL INSTITUTIONs engage in currency transactions related to international narcotics trafficking that include significant amounts of US currency; currency derived from illegal sales in the U.S.; or illegal drug sales that otherwise significantly affect the U.S.: NO
criminalizATION OF money laundering:
“All serious crimes” approach or “list” approach to predicate crimes: List approach
Are legal persons covered: criminally: YES civilly: YES
Know-your-customer (KYC) rules:
Enhanced due diligence procedures for PEPs: Foreign: YES Domestic: YES
KYC covered entities: Banks and state-owned banks, finance and personal loan companies, mortgage finance companies, securities dealers, insurance companies, money exchangers and remitters, asset management companies, jewelry and gold shops, automotive hire-purchase businesses or car dealers, real estate agents/brokers, antique shops, electronic card and payment businesses, credit card businesses, and deposit/lending cooperatives with total operating capital exceeding the equivalent of $67,000
Number of STRs received and time frame: 13,914 in 2014
Number of CTRs received and time frame: 1,120,059 in 2014
STR covered entities: Private and state-owned banks, finance companies, insurance companies, savings cooperatives, securities firms, asset management companies, mortgage finance companies, land registration offices, moneychangers, remittance agents, jewelry and gold shops, automotive hire-purchase businesses and car dealerships, real estate agents and brokers, antique shops, personal loan companies, and electronic payment and credit card companies
money laundering criminal Prosecutions/convictions:
Prosecutions: 9: January 1 - October 31, 2014
Convictions: 17: January 1 - October 31, 2014
Records exchange mechanism:
With U.S.: MLAT: YES Other mechanism: YES
With other governments/jurisdictions: YES
Thailand is a member of the Asia/Pacific Group on Money Laundering (APG), a FATF-style regional body. Its most recent mutual evaluation can be found at: http://www.apgml.org/members-and-observers/members/member-documents.aspx?m=6ff62559-9485-4e35-bf65-305f07d91b05
Enforcement and implementation issues and comments:
Thailand continues to make progress in its AML/CFT legal/regulatory framework, since its passage of the Anti-Money Laundering Act (No. 4) (AMLA (No. 4)) and the Counter Terrorism Financing Act in 2013. The AMLA (No. 4) transfers all supervision of reporting entities to the Anti-Money Laundering Office (AMLO), which serves as Thailand’s financial intelligence unit. Previously, supervision for AML purposes appears to have been lax across the spectrum of regulators. AMLO has assumed its new supervisory role, and has credited its increased outreach to financial institutions for the significant decrease in suspicious transaction reports (STRs) received in 2014 compared with 2013 (74,596 STRs). According to AMLO, financial entities over-reported in prior years because they did not understand the guidelines.
Operationally, Thailand’s AML regime appears to be continuing its longstanding focus on civil asset seizure and forfeiture as compared to criminal enforcement. In the international cooperation arena, where it is appropriate to repatriate or share forfeited proceeds with a foreign jurisdiction, there is a legal impediment barring the assets from being transferred outside Thailand. In spite of a high number of money laundering investigations (70 for 2014), the prosecution and conviction rates are low in comparison to 2013, a result likely attributable to law enforcement resources having been diverted during protests and unrest for much of the first half of the year, culminating in a May 22 military coup.
AMLO is drafting Anti-Money Laundering Act (No. 5), an amendment to the current act. The update is expected to name tax evasion as a predicate offense and to address cross-border bulk cash movement. AMLO hopes to implement the legislative changes in 2015.