Photo Credit: Chanat Katanyu
The Securities and Exchange Commission (SEC) has called on Thai banks to tighten their account opening procedures and implement stricter Know Your Customer (KYC) standards, emphasizing that early intervention is vital to prevent scammers from using mule accounts for money laundering and fraud.
This warning follows public criticism over an ineffective crackdown on mule accounts, which resulted in the freezing of thousands of innocent individuals’ accounts, including many online sellers. Authorities involved acknowledged their shortcomings and committed to improving their processes to ensure only suspicious accounts are targeted.
Anek Yooyuen, deputy secretary-general and SEC spokesperson, stated on Friday that bank accounts serve as an initial entry point for many fraudsters involved in money laundering. He noted that cryptocurrencies remain a popular channel for laundering due to their speed and anonymity, as scammers exploit new technology to circumvent oversight.
“Once funds enter a bank account, they can be converted into cryptocurrency, transferred into private wallets, and moved almost instantly,” he explained. “The private keys involved make tracing extremely difficult.” Unlike traditional stock trading, cryptocurrency transactions can be completed within seconds, making banks the first line of defense, added Mr. Anek.
He highlighted that mule accounts often involve both unwitting victims and participants in scams such as romance fraud and other illicit activities. The SEC has frozen 31,266 accounts worth an estimated 229 million baht this year, though officials admitted this figure is small relative to the scale of illegal financial flows.
“Funds move rapidly in and out, making prevention at the banking level crucial,” said Mr. Anek. “Once baht are exchanged for digital assets, tracking becomes far more difficult.”
Regulators are urging closer collaboration between the SEC, the Bank of Thailand, and the Anti-Money Laundering Office to tackle mule accounts more effectively. Financial institutions are advised to enhance their monitoring systems, promptly block suspicious transactions, and immediately halt scam-related activities.
Mr. Anek also stressed the importance of ongoing public awareness campaigns to educate individuals and prevent them from falling victim to scams.
Between January 1 and September 15 this year, 6,354 suspected investment scams were reported across six channels: the SEC website, telephone (1207, extension 22), email (scamalert@sec.or.th), in-person visits, live chat, and postal mail. Of these, 3,036 social media accounts involved in fraudulent investment activities were identified. The SEC coordinated with social media platforms and government agencies to shut down these accounts, achieving complete removal within 7 minutes to 48 hours in all cases. The SEC also addressed 3,318 cases related to investment scams and provided relevant guidance.
Mr. Anek underscored the need for swift action to shut down scam channels across various platforms to prevent more victims. The process involves verifying information, collecting evidence, preparing blocking requests, engaging with whistleblowers, investigating leads, and contacting individuals whose identities have been exploited — all carried out with care to avoid mistakenly blocking legitimate accounts.
He concluded by reaffirming the SEC’s ongoing efforts, in cooperation with domestic and international partners, to safeguard the public, investors, businesses, and the capital market from fraudulent schemes.