Saudi Arabia's Anti-Money Laundering Law requires persons who provide legal or accounting services -- as designated non-financial businesses and professions -- to immediately report to the Financial Investigation Unit when they suspect that funds represent the proceeds of a crime or are linked to money laundering. The Law defines designated non-financial businesses and professions as any commercial or professional business specified by the Implementing Regulation.
Who Is Subject to the Reporting Duty?
The Law provides that financial institutions and designated non-financial businesses and professions -- including persons who provide legal or accounting services -- must comply with the Law's reporting obligations when they suspect, or have reasonable grounds to suspect, that funds or part of them represent the proceeds of a crime.
Internal Anti-Money Laundering Policies
Financial institutions and designated non-financial businesses and professions must put in place internal policies, procedures, and controls to combat money laundering and implement them effectively in order to manage and mitigate risk, in a manner proportionate to the nature and size of the establishment's business. These policies must be approved by the establishment's senior management and continuously reviewed and strengthened. These internal policies, procedures, and controls must also be applied to all of the establishment's branches and to subsidiaries in which it holds a majority stake, so that they are not limited to the head office alone.
Duty of Immediate Reporting
A person subject to this obligation must immediately and directly report to the Financial Investigation Unit and provide it with a detailed report containing all the data and information available on the transaction and the related parties. The Financial Investigation Unit reports to the Head of State Security, enjoys sufficient operational independence, and acts as a national central agency for receiving reports, information, and reports related to money laundering, analyzing them, and referring the results of its analysis to the competent authorities.
Prohibition on Tipping Off the Client
Financial institutions, designated non-financial businesses and professions, and any of their directors, board members, executive or supervisory management members, or employees are prohibited from alerting the client or any other person that a report under the Law, or related information, has been or will be submitted to the Financial Investigation Unit, or that a criminal investigation is ongoing or has been conducted. Conversely, the reporting person bears no liability toward the person reported on when reporting to the Financial Investigation Unit or providing it with information in good faith, which protects the accountant or advisor who performs the reporting duty.
Penalties
A person who commits the crime of money laundering is punished by imprisonment for a period of not less than two years and not exceeding ten years, or by a fine not exceeding five million riyals, or by both penalties.
Regulatory Measures Against Designated Non-Financial Businesses
When the supervisory authority discovers a violation by a designated non-financial business or profession of the provisions of the Law or its Regulations, it may take or impose one or more measures and sanctions, including: issuing a written warning of the violation committed, issuing an order to comply with specific instructions, imposing a financial fine not exceeding five million Saudi riyals for each violation, or barring the violator from working in the sectors over which the supervisory authority has regulatory power, for a period it determines.
Legal References
- Anti-Money Laundering Law — Articles One, Fourteen, Fifteen, Sixteen, Seventeen, Twenty-Five, and Twenty-Six.
For questions about your specific situation, you can ask the Saudi Arabia Accounting or Tax & Legislation Helper on Helpers, or consult a licensed chartered accountant.