Kuwait Exchange Companies Face Scrutiny for Money Laundering
Kuwait City, Kuwait: Kuwaiti exchange companies are under the spotlight for their role in potential money laundering activities. This comes after a recent report by the Financial Intelligence Unit revealed that exchange companies were the source of 29% of suspected money laundering notifications in 2023.
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Concerns and Reassurances
The high number of reports highlights concerns about exchange companies facilitating illegal financial transactions. A recent court case where two money changers were imprisoned for a major laundering scheme reinforces these worries.
However, the head of the Federation of Exchange Companies, Abdullah Najib Al-Mulla, assures that the industry is strictly regulated by the Central Bank. He emphasizes controls to prevent unauthorized transfers and customer data protection measures like OTP notifications.
Experts Weigh In
Dr. Sadiq Al-Bassam from Kuwait University acknowledges some companies exploiting loopholes for illicit activities. He calls for stronger enforcement to curb such practices. Legal and banking experts warn of the broader consequences of money laundering, including economic instability and reputational damage.
Efforts to Strengthen Regulations
The Ministry of Commerce and Industry is verifying exchange company licenses and implementing stricter data verification measures. This aims to identify beneficial owners and prevent data manipulation. The Ministry emphasizes reporting suspicious activity and assures severe penalties for money laundering violations.
While Kuwait works to improve regulations and oversight, challenges remain. Enhanced vigilance and stricter enforcement are crucial to safeguard Kuwait’s financial integrity, reported Al- Seyassah daily.
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