Kuwait has passed a legal amendment banning all unlicensed currency exchange and informal remittance systems, targeting hawala-style networks to curb money laundering and protect financial stability.
KUWAIT CITY: Kuwait has approved a new legal amendment criminalising unlicensed money transfers, including hawala and other informal remittance systems, in a decisive move to strengthen financial oversight and prevent illicit flows.
The Cabinet has endorsed a draft decree-law adding Article 12 bis to the Commercial Licensing Law No. 111 of 2013, officially banning the buying, selling, exchanging, or transferring of currency outside licensed channels, the Ministry of Commerce and Industry announced.
Hawala networks, where funds are transferred abroad through unlicensed brokers with no formal documentation, have been flagged by the government as high-risk and in violation of international financial standards. The ministry warned that such systems fuel parallel economies, undercut legitimate exchange businesses, and present major money laundering risks.
Violators now face penalties of up to six months in jail or KD3,000 in fines. If a commercial entity is involved, stricter actions apply, including business closure, asset confiscation, and public disclosure of the ruling.
The Public Prosecution has been given full authority to investigate and prosecute violations. Officials emphasised the amendment is part of Kuwait’s wider anti-money laundering strategy and a push to build a transparent, compliant financial system that attracts investor trust.
