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Saudi Arabia Approves Amendments to Anti-Money Laundering Law

United States one dollar bills are inspected under a magnifying glass during production at the Bureau of Engraving and Printing in Washington November 14, 2014. REUTERS/Gary Cameron
United States one dollar bills are inspected under a magnifying glass during production at the Bureau of Engraving and Printing in Washington November 14, 2014. REUTERS/Gary Cameron
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Saudi Arabia Approves Amendments to Anti-Money Laundering Law

United States one dollar bills are inspected under a magnifying glass during production at the Bureau of Engraving and Printing in Washington November 14, 2014. REUTERS/Gary Cameron
United States one dollar bills are inspected under a magnifying glass during production at the Bureau of Engraving and Printing in Washington November 14, 2014. REUTERS/Gary Cameron

The Saudi cabinet approved proposed amendments to the anti-money laundering law, at a time when the kingdom is one of the world's most stringent countries in facing, detecting and controlling money laundering crimes.

According to the regulations, money laundering is the generic term used to describe the process by which criminals disguise the original ownership and control of the proceeds of criminal conduct by making such proceeds appear to have derived from a legitimate source.

A money laundering crime also occurs when funds are acquired, possessed or used, knowing that the outcomes are from a crime or illegal source. Money laundering also occurs when a person hides or disguises the nature, source, movement, possession, place, use or related rights of the funds, knowingly that the funds are an outcome of a crime.

Money laundering is considered a crime that is independent from the original crime, but doesn’t convict the person with committing the original crime.

Financial institutions and undetermined non-financial professions and works should determine risks of potential occurrence of money laundering, assess, archive and update them regularly, stipulated the regulations.

Regulations stipulate that financial institutions are not allowed to open or maintain numbered accounts or anonymous or illusive names. The list of regulations, announced on Friday, bind financial institutions and undetermined non-financial professions and works to apply necessary measures on their clients, and determine framework of necessary measures based on the level of danger related to the client, works or commercial relations.

Financial institutions and undetermined non-financial professions and works should preserve all records, documents and data of financial, commercial and monetary transactions whether local or foreign for a period of ten years. The public prosecution can bind financial institutions and undetermined non-financial professions and works to extend maintaining all records, documents and financial data for investigation or prosecution purposes.

Financial institutions and undetermined non-financial professions and works should monitor and check all records, documents and data of financial regularly to ensure that they comply with the information they have regarding the client, his commercial activities, the risks he represents, and sources of his funds if needed.

The regulations bind financial institutions and undetermined non-financial professions and works to put internal policies and procedures to control fighting money laundering and execute them efficiently to manage determined risks.

Financial institutions, undetermined non-financial professions and works, non-profit organizations, any of their managers, members of directors, executives, supervisors and staff are banned from warning any client or other person that a report or related information will be submitted to the administration for financial investigation, or that an investigation was held or is ongoing.

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Revenue Growth, Improved Operational Efficiency Boost Profitability of Saudi Telecom Companies

A man monitors the movement of stocks on the Saudi Tadawul index. (AFP)
A man monitors the movement of stocks on the Saudi Tadawul index. (AFP)
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Revenue Growth, Improved Operational Efficiency Boost Profitability of Saudi Telecom Companies

A man monitors the movement of stocks on the Saudi Tadawul index. (AFP)
A man monitors the movement of stocks on the Saudi Tadawul index. (AFP)

Telecommunications companies listed on the Saudi Stock Exchange (Tadawul) achieved a 12.46 percent growth in their net profits, which reached SAR 4.07 billion ($1.09 billion) during the second quarter of 2024, compared to SAR 3.62 billion ($965 million) during the same period last year.

They also recorded a 4.76 percent growth in revenues during the same quarter, after achieving sales worth more than SAR 26.18 billion ($7 billion), compared to SAR 24.99 billion ($6.66 billion) in the same quarter of 2023.

The growth in the revenues and net profitability is the result of several factors, including the increase in sales volume and revenues, especially in the business sector and fifth generation services, as well as the decrease in operating expenses and the focus on improving operational efficiency, controlling costs, and moving towards investment in infrastructure.

The sector comprises four companies, three of which conclude their fiscal year in December: Saudi Telecom Company (STC), Mobily, and Zain Saudi Arabia. The fiscal year of Etihad Atheeb Telecommunications Company (GO) ends on March 31.

According to its financial results announced on Tadawul, Etihad Etisalat Company (Mobily) achieved a 33 percent growth rate of profits, bringing its profits to SAR 661 million by the end of the second quarter of 2024, compared to SAR 497 million during the same period in 2023. The company also achieved a 4.59 percent growth in revenues to reach SAR 4.47 billion, compared to SAR 4.27 billion in the same quarter of last year.

The Saudi Telecom Company achieved the highest net profits among the sector’s companies, at about SAR 3.304 billion in the second quarter of 2024, compared to SAR 3.008 billion in the same quarter of 2023. The company registered a growth of 4.52 percent in revenues.

On the other hand, the revenues of the Saudi Mobile Telecommunications Company (Zain Saudi Arabia) increased by about 6.69 percent, as it recorded SAR 2.55 billion during the second quarter of 2024, compared to SAR 2.39 billion in the same period last year.

Commenting on the quarterly results of the sector’s companies, and the varying net profits, the head of asset management at Rassanah Capital, Thamer Al-Saeed, told Asharq Al-Awsat that the Saudi Telecom Company remains the sector leader in terms of customer base expansion.

He also noted the continued efforts of Mobily and Zain to offer many diverse products and other services.

Financial advisor at the Arab Trader Mohammed Al-Maymouni said the financial results of telecom sector companies have maintained a steady growth, up to 12 percent, adding that Mobily witnessed strong progress compared to the rest of the companies, despite the great competition which affected its revenues.

He added that Zain was moving at a good pace and its revenues have improved during the second quarter of 2024. However, its profits were affected by an increase in the financing cost by SAR 26.5 million riyals and a rise in interest, while net income declined significantly compared to the previous year, during which the company made exceptional returns.