Bangkok: The Bank of Thailand, in collaboration with the Thai financial sector, is enhancing proactive measures to curb illicit funds and tighten controls on risky transactions. According to Thai News Agency, the Bank of Thailand, in collaboration with the financial sector, held a ceremony to express its commitment to preventing the misuse of the financial system under the theme "One Commitment, Combined Efforts to Protect the Thai Financial Sector." This initiative aims to enhance proactive preventative measures against illicit capital groups, online gambling, and corruption. The Bank of Thailand revealed that measures to control cash withdrawals and gold trading have reduced monthly cash withdrawals to 40 billion baht from 100 billion baht, and reduced gold bullion withdrawals by 70%.
Mr. Witai Rattanaporn, Governor of the Bank of Thailand (BOT), revealed that the BOT and its supervised businesses are jointly driving the "Framework for Safeguarding the Financial Sector from Illicit Activities." This reflects the commitment to proactively prevent the financial sector from becoming a tool, conduit, or channel for supporting all types of illegal activities, including illicit capital, online gambling, and corruption. The framework focuses on raising the standards of inspection and exchanging in-depth information across the system to create a stable and secure financial ecosystem and protect the public from harm caused by the misuse of the financial system.
There are five key principles under the cooperation framework, as follows: Establish organizational direction and governance, making the prevention of illegal transactions an integral part of corporate governance; establishing effective standards and execution by defining minimum standards appropriate to the business context; leveraging technological strengths to monitor and detect risks; exchanging risk behavior patterns and best practices; and preventing wrongdoing while simultaneously facilitating the well-being of honest individuals and promoting innovation fairly.
Mr. Witai stated that the intention is to prevent the financial sector from becoming a "transit point" or a channel for supporting any type of illegal activity. Although the Bank of Thailand does not have direct detective power, it can create difficulties in accessing financial services to reduce opportunities for fraudsters. Key measures that have already been implemented include cash controls, specifically regulations on cash withdrawals of 5 million baht or more, which require explanation of the source of the funds. This measure has resulted in a decrease in large-scale withdrawals from 100 billion baht per month to only 40 billion baht.
Regulating online gold trading worth 50 million baht and reporting withdrawals of gold bars weighing 2 kilograms or more has helped reduce gold bar withdrawals by up to 70%. The Digital Asset Division, in collaboration with the Securities and Exchange Commission (SEC), has established guidelines for stablecoins, particularly USDT, through the enforcement of travel rules for transmitting recipient-transfer information on digital assets. This aims to curb irregular outbound money transfers and foster data sharing among agencies such as the Anti-Money Laundering Office (AMLO), SEC, National Anti-Corruption Commission (NACC), and the police, creating a more comprehensive system.
The 11 organizations under the supervision of the Bank of Thailand (BOT) participating in this cooperation framework include the Thai Bankers Association (TBA), the General Financial Institutions Association (GFA), the Association of International Bankers (AIB), the Thai Electronic Payment Service Providers Association (TEPA), the Thai Association of Foreign Exchange and Financial Services (TAFEXS), and six non-bank lenders associations and clubs. They will collaborate on various aspects, such as enhancing KYC/CDD/EDD procedures, investigating high-risk cash transactions, utilizing advanced technology for proactive detection of suspicious transactions, developing a database of high-risk individuals and connecting it to the Central Fraud Registry (CFR), creating operational guidelines on anti-money laundering and counter-terrorism financing (AML/CFT) measures for the industry, and leveraging community networks to build financial literacy among vulnerable groups.
The Bank of Thailand and regulated businesses will continue to implement measures to close loopholes in the financial system that could be exploited for illegal activities, enhance financial fraud prevention and response to protect the public, and create a financial ecosystem where people can use services with confidence and trust in the long term.