KUWAIT CITY, March 9: In light of the economic revolution that the country is currently witnessing, which involves eliminating corruption at its roots, and with the government’s efforts to draft a new anti-money laundering law; a group of economic and legal experts have called for addressing loopholes in Law No. 106/2013. In an investigative report by the newspaper, the experts affirmed the need to identify the reasons behind the failure to implement the current law effectively. They pointed out the urgency of taking comprehensive measures to combat money laundering, especially since the Financial Action Task Force (FATF) previously warned Kuwait of potential inclusion on its gray list.

These experts argue that the persistence of money laundering has serious implications for the national economy, as well as contributing to inflationary pressures. Ali Al-Attar, a lawyer specializing in money laundering cases, stressed the importance of incorporating comprehensive and urgent money tracking mechanisms in the new law. He suggested that the forthcoming legislation should address the reasons for the ineffective enforcement of the current Anti-Money Laundering Law (No. 106/2013). He also recommended using the real estate fraud case in Kuwait as a case study in drafting the new law. He said the new law should mandate government agencies to provide investigation authorities with sufficient and timely information about financial crimes to prevent perpetrators from evading punishment. He emphasized that, according to the Constitution, money laundering harms both the national economy and the country’s international standing. “The issue, however, does not lie in the law’s formulation but rather in its enforcement.

A thorough investigation into why existing laws are not being implemented is necessary before any amendments are made. This can be achieved by reviewing previous money laundering cases brought before the courts,” he explained. He cited as a significant example the real estate fraud case, in which hundreds of millions of Kuwaiti dinars were seized illegally. “Despite convictions and fines exceeding KD800 million, no funds have been recovered. This indicates the need for investigating why government agencies have not been providing the required information and reports to the public prosecution in a timely and comprehensive manner, leading to inconsistent court rulings for identical cases,” he added.

He mentioned the importance of giving attention to the role of banking institutions involved in money laundering activities. “Investigating why these entities have not faced penalties or been transparent about the origins of funds is crucial. There is also a need for government agencies to enforce judicial rulings regarding the collection of fines imposed in favor of the State,” he asserted. Former Secretary of Kuwait Transparency Society Manal Al-Kandari said the fight against money laundering is part of a global effort that requires collaborative action. “Kuwait, as part of the international framework, issued Law No. 106/2013 to combat money laundering and terrorist financing. However, some provisions of the current law must be reconsidered, particularly the process for notifying suspected individuals. As it stands, the suspected funds remain accessible to the accused until the Public Prosecution makes a decision.

Clear standards for evidence to avoid Kuwait being added to the FATF’s gray list are vital. As a member of the FATF, Kuwait must adhere to the recommendations aimed at strengthening control systems and improving anti-money laundering and terrorist financing procedures,” she elaborated. Al-Kandari also called for tightening measures to ensure that those engaged in money laundering are held legally accountable. Economic expert Mohamed Ramadan acknowledged that the government has been combating money laundering under the existing 2013 law, but he questioned the rationale behind drafting a new law when the current one is still in place. He suggested clarifying why the government is moving toward a new anti-money laundering law, especially since Kuwait has faced pressure from the FATF over existing shortcomings.

By Najeh Bilal
Al-Seyassah/Arab Times Staff