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Thai Government tightens the screws on Diamond & Jewelry Money Laundering.
Thailand's anti-money laundering office, Amlo, tightened its grip on gold and jewelry trade, requiring them to report any cash transaction of the valuable goods worth $24,310 (THB 1 million) or more. The threshold is about half the amount jewelers would comply with in the United States beginning January 1, 2006.
The new regulation will apply to more than 6,000 gold shops and thousands of jewelry shops nationwide, according to the Amlo secretary-general, Pol Maj-Gen Peeraphan Prempooti.
New rules go into effect in March 2006, and require all traders and businesses, except financial institutions, to report gold and jewelry cash transactions in excess of threshhold. A fine of up to $7,293 (THB 300,000) per transaction will be imposed upon any party failing to report transactions to Amlo.
All gold and jewelry shops, pawnshops and agents involved in the exchange of valuable objects must abide by the regulation under the money laundering act of 1999, according to Prempooti, as are in the high risk category of being exploited by money launderers.
Pol Maj-Gen Peeraphan added the regulation was in line with international practices determined by the United Nation's International Center for the Prevention of Crime. Any country ignoring the practice would be blacklisted and could face financial barriers such as blockades of international money transfers.
Jitti Tangsithpakdi, president of the Gold Traders' Association, said the new rule was unlikely to affect the domestic gold business very much, but it could deter those who seek a lucrative investment return. According to Tangsithpakdi, lower deposit rates and higher oil prices over the past two to three years have prompted a number of cash-rich investors to shift to lucrative gold, mostly by trading bullion. The country imports 100 tons of gold on average a year. The figure could go up to 110 tons if the economy is in good shape.
The Fin Center, a division of the U.S. Government's Homeland Security Office is putting into effect it's own anti-money laundering regulations starting at $50,000 beginning January 1, 2006. This is in direct response to 9/11 and designed to make it more difficult if not impossible for terrorists to fund their activities.
