Assembly Passes Law To Curb Money Laundering

The National Assembly unanimously approved a draft law Mon­day that aims to curb money laundering and the financing of terrorism.

Under the law, a new government investigative body will be created by the National Bank of Cam­bo­dia with representatives from the Council of Ministers and the In­terior, Justice and Finance ministries.

The body will have broad investigative powers to access information from banks, insurance companies, NGOs, accountants and law­yers, according to the draft.

Those who refuse to provide in­formation requested by the body could face up to a month in jail and fines of $25 to $250. The law would allow the state to confiscate assets considered to be caught up in mon­ey laundering or used to fi­nance terrorism.

“This law is an important tool for Cambodia to prevent money laundering and terrorism financing,” National Bank Governor Chea Chanto told the Assembly. “I prom­ise that we will use the law to serve the people’s interests.”

All 77 lawmakers in attendance vot­ed through the law, though several SRP and Funcinpec parliamentarians raised concerns about it.

Funcinpec lawmaker Soth Soth­un pointed out a controversial clause in the law that appears to im­pinge on the basic legal principal of attorney-client privilege.

Under the legislation, the proposed investigative body must be granted unfettered access to the client records held by lawyers, ac­countants or other professionals who are obliged to protect their clients’ confidential information.

“Lawyers have a duty to keep their clients’ secrets, otherwise they will lose their license,” Soth Sothun said.

Prominent defense attorney Liv Sov­anna, who represents Prince Nor­o­­­dom Ranariddh, said by telephone that the law violates the professional code of conduct that all lawyers are required to follow.

“There is no law in the world that forces lawyers to divulge their clients’ secrets,” he said.

CPP lawmaker Cheam Yeap told the Assembly that the law would be ineffective if launderers or terror financiers could hide behind their attorneys or accountants.

SRP lawmaker Yim Sovann said it would be difficult to combat mon­ey laundering or terrorism fi­nancing while Cambodia still has a dollarized economy.

The ease with which US dollars move internationally makes it easy for criminals to transfer and hide their wealth, Yim Sovann said.

Finance Minister Keat Chhon said the government is working to phase out dollars, but it has to do so slowly.

 

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