Saudi Arabia has introduced new anti-money laundering and counter financing of terrorism (AML/CFT) rules to limit the activities of money exchange dealers that includes barring them from opening letters of credit (L/Cs).

The new rules introduced by the Saudi Arabian Monetary Authority (SAMA) also set guidelines for operators providing money exchange services in the tourism sector.

Exchange limitations

Money changers are now limited to buying, selling and circulating foreign currencies, importing and exporting currencies, provided they have obtained a license from SAMA.

They should not carry out any unauthorised activity, including any other commercial business not authorised by SAMA.

Money changers without authorisation are barred from opening current accounts, investment accounts, savings accounts or any other accounts for their clients or employees. Neither may they issue letters of guarantee or open L/Cs, accept deposits or speculate in currencies, metals and stocks.

Tourism arrangements

Under the new rules hotels, hotel apartments, and tourist offices are allowed to exchange currencies from their customers provided that these currencies are sold to a licensed bank or exchange centre.

Establishments providing these services must adhere to the provisions of Saudi AML/CFT regulations and those determined by UN Security Council resolutions.

This article represents the views of the author and not necessarily those of the ICC or Coastline Solutions.