Anti-Money Laundering Act

Section 3 holds the definitions, including the list of 21 predicate offences (ความผิดมูลฐาน), among them drug offences; human-trafficking and certain sexual-exploitation offences; public fraud; offences by directors or managers of financial institutions; offences against public office or the administration of justice; extortion under the cover of a secret society; customs smuggling; terrorism offences under the Criminal Code; unlicensed gambling operations with total stakes of THB 5,000,000 or more, or electronic gambling; participation in organised crime; habitual or commercial theft, extortion, robbery, fraud and embezzlement; commercial counterfeiting or intellectual-property offences; forged documents; natural-resources offences; piracy; unfair securities and futures trading; and arms and explosives trading. Offences committed abroad count if they would be predicates when committed in Thailand. A suspicious transaction is defined to include one linked to a predicate offence or to financial support for terrorism; the terrorism predicate is the Criminal Code offence, not a financing offence. Financial institutions include banks, finance and credit-foncier companies, securities companies, life and non-life insurers, certain cooperatives with share capital of THB 2,000,000 or more, and juristic persons in other finance-related business set by ministerial regulation (limb (6)).

A person commits money laundering by (1) transferring, receiving a transfer of, or converting property connected with an offence to conceal or disguise its source or to help another avoid or reduce punishment for the predicate offence; (2) doing anything to conceal or disguise the true nature, acquisition, location, disposal, transfer or rights in such property; or (3) acquiring, possessing or using property knowing at that time that it is connected with an offence. Section 6 gives the Act reach over laundering committed outside Thailand in specified cases. Section 7 punishes those who support or help the offender as principals, Section 8 punishes an attempt as the completed offence, and Section 9 punishes conspiracy by two or more people at half the penalty.

Financial institutions must report to AMLO a transaction that is (1) in cash above the amount set by ministerial regulation, (2) a property transaction above the value set by ministerial regulation, or (3) suspicious, whether or not (1) or (2) applies. The monetary thresholds are not in the Act; they are set by ministerial regulation, and so are the form, timing and method of reporting (Section 17). A report made in good faith carries no liability (Section 19). The cash-transaction duty binds financial institutions here; the listed professions' duty is in Section 16.

Listed professions and businesses must report to AMLO cash transactions above the amount set by ministerial regulation and suspicious transactions. The list covers advisers on securities-law investment or fund-movement transactions that are not financial institutions, dealers in gems, gold and jewellery, car dealers and hire-purchase providers, real-estate brokers and agents, antique dealers, supervised personal-loan, e-money-card and credit-card businesses outside financial institutions, electronic payment services, and money-exchange businesses assessed as high-risk as set by ministerial regulation. Limbs (2) to (5) must be juristic persons, except that AMLO may order a written report from a non-juristic one where there is reasonable suspicion backed by evidence. There is no property-value limb in this section.

Financial institutions and Section 16 professions must have customers identify themselves before each transaction as set by ministerial regulation, unless they already did (Section 20). Financial institutions and the Section 16(1) and (9) professions must adopt customer-acceptance and money-laundering risk policies and carry out due diligence from the first transaction until the account closes or the relationship ends (Section 20/1); its scope for other professions is set by ministerial regulation. If due diligence cannot be completed, the reporting person must report to AMLO immediately (Section 21/2, first paragraph), and AMLO may order the transaction suspended for up to ten working days where it has evidence of an offence (second paragraph).

Reporting persons under Sections 13 and 16, and anyone else, must not disclose information or do anything that may let a customer or a third party learn of customer due diligence, a transaction report or any other data sent to AMLO, except to comply with law or a court order or between head office and branches for compliance with the Act. Reports received by AMLO are official secrets. Breach is punishable by imprisonment of up to five years, a fine of up to THB 100,000, or both (Section 66).

Unless an officer directs otherwise in writing, financial institutions keep customer-identification records for five years from account closure or the end of the relationship, and transaction records for five years from the transaction; the identification rule also applies to Section 16 professions. Customer due-diligence records are kept for ten years from closure or the end of the relationship, and the Secretary-General may extend that by up to five more years for a specific customer (Section 22/1).

The Board has 14 members: four experts appointed by the Cabinet; nine office-holders, namely the permanent secretaries of Finance, Foreign Affairs and Justice, the Secretary-General of the National Security Council, the Attorney-General, the National Police Chief, the Governor of the Bank of Thailand, the Secretary-General of the SEC and the Secretary-General of the NACC; and the AMLO Secretary-General as member and secretary. The members elect a chair and a vice-chair from among themselves, the chair needing two-thirds of the votes of all members. The expert members serve one four-year term (Section 26).

On reasonable suspicion backed by evidence that a transaction relates to a predicate or laundering offence, the Transaction Committee may order it held for up to three working days (Section 35, first paragraph). In urgent cases the Secretary-General may order the hold first and report to the Committee (second paragraph). Where the evidence makes it believable, the Committee may hold it for up to ten working days (Section 36). The Committee has five members: four selected under Section 32/1 and the Secretary-General.

On reasonable grounds to believe that property connected with an offence may be transferred, disposed of, moved or hidden, the Transaction Committee may order it provisionally seized or frozen for up to 90 days; in urgent cases the Secretary-General may order it first and report to the Committee. The person transacting, or anyone with an interest in the property, may show that it is not property connected with an offence to have the order revoked, under rules in a ministerial regulation. After the public prosecutor has filed the forfeiture petition, the court may also order provisional seizure or freezing on an ex parte application (Section 55).

Where the evidence makes it believable that property is property connected with an offence, the Secretary-General refers the matter to the public prosecutor, who considers petitioning the court to order the property to vest in the State; court proceedings under this Chapter are filed in the Civil Court (Section 59). If the prosecutor finds the file incomplete it is returned with all deficiencies listed at once. If the prosecutor still declines, the Board decides within 30 days, and if it does not decide in time the prosecutor's view stands. In short, assets tied to a predicate offence can be forfeited to the State by order of the Civil Court, on a petition the public prosecutor files at the Secretary-General's referral (Section 59).

A person claiming to own property the prosecutor asks the court to forfeit may apply before the court rules, and must show the court either that they are the true owner and the property is not connected with an offence, or that they received it in good faith and for value, or in good faith and consistently with morality or public charity (Section 50). If the court is satisfied that the property is connected with an offence and the claim fails, it orders the property to vest in the State. Cash, and money arising from managing seized or frozen property, is split half to the AML Fund and half to the Ministry of Finance; other property is dealt with under Cabinet rules. Where the claimant is or was connected with the predicate or laundering offender, the Act presumes the property is connected with an offence or was received in bad faith (third paragraph).

Money laundering is punishable by imprisonment of one to ten years, or a fine of THB 20,000 to 200,000, or both (Section 60). A juristic person that commits the Section 5, 7, 8 or 9 offence faces a fine of THB 200,000 to 1,000,000, and a director, manager or other person responsible whose order or failure to act caused it faces imprisonment of one to ten years, or a fine of THB 20,000 to 200,000, or both (Section 61).

Failing to comply with the reporting, identification, due-diligence and record-keeping duties (Sections 13, 14, 16, 20, 20/1, 21, 21/2 first paragraph, 22, 22/1, 35 and 36) or with certain AMLO orders is punishable by a fine of up to THB 1,000,000 plus up to THB 10,000 a day while the breach continues. A false or concealing report is punishable by imprisonment of up to two years, a fine of THB 50,000 to 500,000, or both (Section 63). A comparison committee may compound the Section 62, 63 and 64 offences (Section 64/1).