Editor’s Note
This new guide from the Ministry of Commerce and Industry addresses a critical vulnerability. By outlining how illicit funds exploit the gold and precious metals trade, it provides essential compliance tools for a sector vital to the global economy.
A report by the Ministry of Commerce and Industry, titled “The Anti-Money Laundering and Counter-Terrorism Financing Guide for the Gold and Precious Metals Trading Sector 2025,” aims to help professionals understand and comply with relevant laws and guidelines. It highlights that criminals often exploit the sector to store, move, and integrate illicit funds within legitimate frameworks, taking advantage of weak oversight, informal practices, and complex global supply chains.
According to Kuwait’s National Risk Assessment, the precious metals and gemstones trading sector is classified as medium to high risk. The Financial Action Task Force (FATF) has also identified this sector as high-risk for money laundering, terrorist financing, and proliferation financing. The sector’s appeal stems from the high value of its products, their ease of transport, and their convertibility into cash.
Although cash transactions exceeding KD 3,000 have been prohibited in Kuwait since 2016, the legal framework was further strengthened in 2025 with a comprehensive ban on all cash transactions in this sector, regardless of value.
The guide emphasizes the adoption of a risk-based approach (RBA), a dynamic process involving identifying, assessing, and mitigating money laundering and terrorist financing risks. Procedures must be proportional to the assessed risk, with high-risk areas subjected to enhanced measures, including customer due diligence and transaction monitoring.
Specific high-risk categories, such as politically exposed persons, high-net-worth individuals, or particular transaction types, require heightened scrutiny. Traders must consider multiple risk categories to identify and assess threats. The guide outlines AML/CFT controls covering payment and transaction risks, such as unconventional or large cash payments, advance payments from unrelated third parties, and funds routed through high-risk sectors like real estate or construction.
Customer due diligence (CDD) must be carried out before establishing any business relationship or conducting occasional transactions worth KD 3,000 or more. This includes verifying the identity of the customer and beneficial owner, understanding the business relationship, and confirming the source of funds and wealth, particularly for high-value transactions.