Kuwait Tightens AML Rules for Real Estate Brokers

Synopsis: Kuwait has introduced stricter anti-money laundering guidelines for real estate brokers, requiring suspicious transaction reports within two working days and enhanced due diligence to strengthen property market oversight.

The Ministry of Commerce and Industry in Kuwait has developed a compliance manual that imposes stringent measures in terms of anti-money laundering (AML) compliance for real estate brokers in an effort to increase supervision on the country’s property sector. These changes to the existing compliance manuals ensure that the country’s regulatory framework meets the international standards in terms of financial crime prevention. The new guidelines require brokers to inform the FIU of any money laundering activities in two business days.

These regulations have been formulated under Law No. 106 of 2013 to counter money laundering and terrorist financing, which is a part of Kuwait's initiative to improve transparency and comply with the FATF recommendations. It is expected that these regulations will help the country perform well in the upcoming international mutual assessments without compromising the integrity of its real estate industry.

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According to the Ministry of Commerce, the guidance is anchored in the country’s 2022 National Risk Assessment,  where the real estate industry was categorized as having a high-medium risk of money laundering. The National Risk Assessment had listed 25 investigations, 12 prosecutions, and 7 convictions related to money laundering offenses committed within the real estate sector. The FATF mutual evaluation in 2024 pointed out that there had been no suspicious transaction reports coming from the real estate sector since 2019 despite the recorded cases of illegal property transactions.

The proposed changes will oblige real estate brokers to perform more thorough customer due diligence whenever any of the red flags appear. They would involve customers who refuse to tell the broker the origin of the money, lie about themselves and their intentions, try to hurry the deal, or buy property without an economic reason. In addition, brokers need to pay attention to the difference between their customers' income and the cost of the bought property.

A number of indicators have been specified by the ministry that indicates transactions that deserve further analysis. These include fast reselling of assets without a legitimate reason for the transaction, repetitive buying and selling of the same asset, conducting transactions at prices well above or below market value, making payments from unrelated third parties, transferring money to unrelated parties, and mysterious funding sources.

The guidance goes on to list geographical risk factors that include dealings with people or firms from countries with poor money laundering regulations, offshore bank accounts or complicated ownership schemes across borders to disguise the identity of the true owner. The brokers are supposed to employ further verification methods where these kinds of transactions are concerned.

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These new actions form part of the anti-money laundering reforms being taken by Kuwait as a whole, and were implemented early in 2026. In March, the ministry established a new system of penalties for non-compliance by designated non-financial business and professions. The penalty system is based on levels of risk, and includes punishments such as warnings, financial penalties and license suspension or revocation.

The improved framework will help enhance suspicious transaction reporting and the importance of real estate practitioners in fighting financial crimes as well as protecting the real estate market in Kuwait from any abuse by criminal networks. It is also worth noting that the new regulations are an indication of the government's efforts to remain compliant with the international AML guidelines.