Saudi Arabia is an attractive region for FinTech. But before establishing a corporation in the nation, every entrepreneur must have the most relevant AML knowledge in order to get things done accordingly to regulations.
In short, there are no formal international sanctions implemented against Saudi Arabia. Nonetheless, entrepreneurs planning to onboard or to invest in new projects, new users in Saudi Arabia must make some proper AML and KYC check-ups and have to be on guard. In the past, Saudi government has had some issues with money laundering and corruption. Several French corporations refused to make contracts with Saudi Arabia due to government issues in 2018.
As for sanctions on Saudi Arabia specifically, the situation has escalated in 2018 when Jamal Khashoggi was assassinated by Saudi agents because he criticized the Royal House of Saud. The US senators have proposed sanctions against Saudi Arabia immediately and they stated that—’any interests in property or property of the individuals designated today transiting or within US jurisdiction is blocked.’ But still, this proposal has never been applied.
The US has also prohibited the entry of sixteen Saudi officials because of their involvement in the Khashoggi case. This is the main response of the US government to severe human rights abuse as well as the way ‘to preserve the US financial system from the same individuals.
The European Commission has added Saudi Arabia to the list of countries that might be a threat because of their lenient control over money laundering and financing of terrorism. The EU ‘blacklist’ consists of 23 countries, including Iraq, Iran, Afghanistan, Syria, North Korea, and Yemen.
In addition to the bad publicity, being in the ‘blacklist’ makes financial relationships with the EU complicated. The banks have to conduct additional payment checks if individuals from the listed nations are involved. It mainly concerns the UK as several top British banks are having high activity in the country. According to statements, the Royal Bank of Scotland has made the largest turnover in European banks to Saudi Arabia around 150 million euros.
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