Thailand

1. Does Thailand have legislation making it a criminal offence to engage in money laundering and/or terrorist financing?

Yes. Thailand has enacted primary legislation on money laundering and/or terrorist financing as follows:

• The Anti‑Money Laundering Act B.E.2542 (1999) (“AMLA”) which sets out the legal framework for the management, monitoring, and inspection of anti-money laundering; and
• The Prevention and Suppression of Financial Support to Terrorism and the Proliferation of Weapons of Mass Destruction Act B.E.2559 (2016) (“FST”) which sets out the legal framework for the management, monitoring, and inspection of anti-money laundering for counter-terrorism financing.

2. To whom does the legislation apply?

The AMLA and the FST apply to individuals, legal entities, and organisations (both domestic and foreign) that conduct business operations either inside or outside the territory of the Thailand and that are involved in money laundering and/or terrorism financing.

3. What does the legislation prohibit?

The AMLA and FST both prohibit money laundering and terrorism financing activities.

4. How is money laundering defined? Does underlying criminal activity have to be proven?

Section 5 of AMLA defines the offence of money laundering as follows:

• Transferring, accepting a transfer of or converting an asset connected with the commission of an offence for the purpose of covering or concealing the origin of that asset or, whether before or after the commission thereof, for the purpose of assisting other persons to evade criminal liability or to be liable to lower penalty in respect of a predicate offense;
• Acting in any manner whatsoever for the purpose of concealing or disguising the true nature, acquisition, source, location, distribution or transfer of an asset connected with the commission of a predicate offence or the acquisition of rights therein; or
• Obtaining, possessing or using an asset, knowingly at the time of obtaining, possessing or using of such asset that it is the asset connected with the commission of predicate offense.

The criminal process shall be proven whether an accused conducts the predicate offence under AMLA or not. If yes, the prosecutor shall consider whether the accused conducts any activities under section 5 mentioned above.

5. What level of intent or knowledge is required to establish a violation?

AMLA does not explicitly state what level of intent or knowledge is required to establish a violation. However, the wording “knowingly at the time of obtaining, possessing or using of such asset” suggests that a mere suspicion that the laundered assets were derived from a predicate offence is enough to establish a violation. Furthermore, there has not been until date any the Supreme Court decision in relation to level of intent or knowledge at the present.

6. What are the potential penalties for infringing the legislation?

The AMLA and the FST provide general measures against violators including fines and criminal sanctions for infringing the legislation which are as follows:

(1) Section 60 of AMLA sets out the following penalties for an individual person committing money laundering offences:

• Imprisonment for a term of 1 to 10 years and/or liable to a fine from THB 20,000 (approximately USD 625) to THB 100,000 (approximately USD 3,125).

(2) Section 61 of AMLA sets out the following penalties for a juristic person committing money laundering offences:

• Fine from THB 20,000 (approximately USD 625) up to THB 1,000,000 (approximately USD 31,250); or
• Imprisonment for a term of 1-10 years and/or fine THB 20,000 (approximately USD 625) up to 200,000 (approximately USD 6,250) unless that person can prove that he or she takes no part in the commission of the offense of such juristic person in the case of any director, manager or person responsible for the conduct of business of the said juristic person.

(3) Section 25 paragraph 1 and 3 of the FST sets out the following penalties for any persons providing financial support to terrorism:

• Imprisonment for a term of 1-10 years and/or a fine of THB 20,000 (approximately USD 625) up to THB 200,000 (approximately USD 6,250); or
• Shall be liable to the same penalty as that imposed on the perpetrator in the committing of such offence in the case of a co-conspirator.

(4) Section 25 paragraph 2 and 3 of the FST sets out the following penalties for any person providing financial support for the proliferation of weapons of mass destruction:

• Imprisonment for a term of 2-10 years and/or a fine of THB 40,000 (approximately USD 1,250) up to THB 200,000 (approximately USD 6,250);
• Shall be liable to the same penalty as that imposed on the perpetrator in the committing of such offence in the case of a co-conspirator.

(5) Section 25 paragraph 4 of the FST sets out the following penalties for a juristic person providing financial support to terrorism or for the proliferation of weapons of mass destruction:

• Shall be liable for a fine of THB 500,000 (approximately USD 15,625) up to THB 2,000,000 (approximately USD 62,500).
• Imprisonment for a term of 4-10 years and/or a fine of THB 40,000 (approximately USD 1,250) up to THB 200,000 (approximately USD 6,250) (i) in the case where the committing of the offence by a juristic person has resulted from the instruction or an action of a director or a manager or any person responsible for the operation of such juristic person , or (ii) in the case where such person has the duty to give instructions or take action and refrains from giving instructions or taking action thereby leading to the committing of offence by such juristic person.

7. Does the legislation have extra-territorial reach?

Yes, the AML Law extends its application to individuals, legal entities, and organizations (both domestic and foreign) that conduct business operations outside the territory of Thailand that are involved in money laundering and terrorism financing.

8. Are there additional anti-money laundering or counter terrorist financing regulations or obligations, such as registration or reporting obligations, for businesses or individuals that operate in particular sectors or undertake particular activities?

Obligation under the AMLA

When a transaction is made with a financial institution, the financial institution shall have the duty to report that transaction to the Anti-Money Laundering Office (“AMLO”) when it appears that such transaction is:

1. a cash transaction exceeding the threshold prescribed in the Ministerial Regulation (e.g. cash remittance which exceeds THB 2,000,000 (approximately USD 62,500));
2. a transaction connected with the asset worth more than the value prescribed in the Ministerial Regulation (e.g. the asset value which exceeds THB 5,000,000 (approximately USD 156,250)); or
3. a suspicious transaction, whether it is a transaction under (1) or (2) or not.

The above duty would be applied to any profession that conduct businesses as prescribed in the AMLA (e.g. an advisor in transactions relating to the investment or movement of funds, a broker or an agent in buying or selling immovable property, electronic money card or payment, credit card).

All of the aforementioned shall be collectively referred to as the person in charge of reporting under the FST.

Obligation under the FST

Section 8 of the FST provides the measures for (1) the person in charge of reporting or (2) the person possessing the property of the determined persons shall take action without delay as follows:

• suspending the handling of property of the determined persons or of the persons acting on behalf of or at the instruction of such persons or of undertakings under possession or control of such persons, whether directly or indirectly;
• notifying the AMLO of the information in relation to the property with respect to the suspension of the handling; or
• notifying the AMLO of persons who are or were customers and whose names are in the list of the determined persons or persons who conclude or have concluded transactions with such persons.

Further, a person in charge of reporting shall determine a policy on risk assessment or any practice guideline for preventing financial support to terrorism or determine any other necessary measures for the purpose of the execution of the FST.

9. What are the potential penalties for failing to comply with these obligations?

Penalties under the AMLA

Any person who violates or refuses to report the transaction to the AMLO shall receive a fine not exceeding THB 1,000,000 (approximately USD 31,250) and an additional amount of fine not exceeding THB 10,000 (approximately USD 312.50) for each following day that the violation was not corrected or until the action was carried out correctly.

Any person who reports or makes a notification by presenting false statements of fact or concealing the facts required to be revealed to the AMLO shall be liable to imprisonment for a term not exceeding two years or to a fine of THB 50,000 (approximately USD 1,562.50) up to THB 500,000 (approximately USD 15,625) or both.

Penalties under the FST

The person in charge of reporting or the person possessing the property of the determined persons who fail to comply with the obligations under the FST mentioned in item 8 above, shall face penalty as follows: