Kuwait moves to block suspicious financial activities in major revamp

• Electronic transactions help eliminate unauthorized individuals and reduce fraud, financial scams, and other issues that arise from traditional paper-based contracts.

In line with government efforts to enhance the local business environment according to international standards, informed sources told Al Rai newspaper that the Ministry of Commerce and Industry has been advised to implement precautionary measures aimed at preventing suspicious financial activities.

The sources stated that the Ministry of Commerce and Industry was instructed to coordinate with the General Authority for Civil Information to issue an electronic real estate broker registry. This move aims to strengthen control over money laundering activities and automate real estate transactions, thereby contributing to the development of a real estate information database that benefits all investors and enhances the informational efficiency of regulatory bodies.

The sources added that expediting the approval of these measures would enable various state agencies to remain vigilant against potential financial crimes, which are closely monitored internationally. Furthermore, all dealings with intermediaries would ensure the broker’s identity can be verified, determining whether they are officially recognized or not.

Electronic transactions

The sources explained that electronic transactions help eliminate unauthorized individuals and reduce fraud, financial scams, and other issues that arise from traditional paper-based contracts.

They also noted that one of the government’s recommendations for the Ministry of Commerce is to strengthen its efforts to combat money laundering and terrorist financing by restructuring and enhancing its supervisory role. This includes empowering its team to better audit and analyze financial statements, and ensuring that financial institutions, non-financial businesses, and professions comply with Law No. 106 on money laundering and terrorist financing, as well as related regulations. The ministry will prepare the necessary reports and submit them to the relevant authorities.

Significant overhaul of human resources

The sources stated that this transformation requires a significant overhaul of human resources, starting with increasing the number of employees in this department and developing their procedural and technical capabilities to track funds and property.

Additionally, providing financial incentives would encourage them to meet the necessary regulatory standards, alongside raising the frequency of field inspections. The sources also emphasized reinforcing the role of the Anti-Money Laundering and Terrorist Financing Department within the working team itself.

They noted that the targeted development of this department also demands enhancing its legal capabilities. The availability of these tools will enable regulatory authorities to make effective changes and improve verification of the identity of the ultimate beneficiaries behind company formations and various contributions registered with the ministry’s commercial registry.

Strengthening supervisory capacity

The sources stated that these measures will strengthen supervisory capacity, helping identify the final destination of funds, including tracking liquidity flows in sectors vulnerable to money laundering, such as the precious metals sector.

Moreover, government recommendations emphasized the need for the Ministry of Commerce to coordinate with the General Anti-Corruption Authority regarding the exchange of information between the Anti-Money Laundering and Terrorist Financing Department and the Authority.

The ministry was also urged to develop a mechanism to regulate social media platform advertisements and their relationship with advertisers, in coordination with the Ministry of Information, to protect consumers from manipulation.

Inventory of supply branches and legal actions against offenders

On the other hand, the Ministry of Commerce and Industry recommended establishing effective coordination with Kuwait Supply Company and cooperatives to conduct an inventory of supply branches, assess the financial discrepancies arising from the inventory, and take legal action against the responsible party.

The sources emphasized that the ministry has significantly improved its supply capabilities in recent times, reducing the likelihood of supply losses. They noted that the ministry is working with ‘Kuwait Supply’and other relevant authorities to enhance the efficiency of the supply system and ensure that goods reach beneficiaries in line with the state budget, without any waste.