A technocrat with 20 years of experience at Kuwait’s central bank, Mr Al Sayegh was appointed to head the country’s newly empowered Financial Intelligence Unit in January.
The unit faces its first major test on October 24 when the Financial Action Task Force, an intergovernmental policy group that sets standards for fighting terror funding and money laundering, is expected to update its outlook on Kuwait.
The unit existed in the past, but only began operating in compliance with the task force’s requirements in June, said Mr Al Sayegh.
In its latest statement on Kuwait, the group said “deficiencies remain”, making the upcoming review an important indicator of the country’s efforts to combat terror funding.
Even if the appraisal goes well, the country faces the longer term challenge of prosecuting funders of extremist groups, with Mr Al Sayegh’s efforts stuck between Kuwait’s obligations to the international community and relatively popular, well-connected donors.
“You cannot make a system immune to everything,” he said. “But once you find [suspicious activity] you have to take action.”
After peaceful protests that began in 2011 calling for the end of Bashar Al Assad’s regime in Syria descended into war, Kuwaiti citizens became some of the main sources of funds for both humanitarian aid and arms for rebel groups.
Some of the funding ended up with Jabhat Al Nusra, Al Qaeda’s Syria affiliate, and, later, its more extreme rival ISIL.
Kuwait only criminalised the funding of terror groups last year. The change in law also allowed for the establishment of the Financial Intelligence Unit.
Recently, the United Nations designated several Kuwaitis — including popular cleric Shafi Sultan Mohammed Al Ajmi — as backers of Al Nusra, placing the country under further scrutiny as a source of extremist funding.
“They were sleeping at the wheel for 13 months,” said Aimen Dean of Five Dimensions Consultants, a Dubai-based private research firm focused on the Middle East, describing Kuwait’s efforts to crack down on extremist financiers.
“Only as momentum built before the US-led airstrikes [against ISIL in Iraq and Syria] did things really change. It is important to note that Kuwait became an important conduit for terror financing after Saudi Arabia clamped down hard on such activities. Many financiers in the region moved to Kuwait where legislation is more lax regarding money transfers.”
Mr Al Sayegh said: “The necessity was there, everyone acknowledged this.”
The Financial Intelligence Unit is currently located within the finance ministry, but there are plans to move next year, in a bid to retain its independence.
Annual reports will be submitted to the finance minister, who provides oversight, but the unit will otherwise remain removed from the ministry’s bureaucracy, Mr Al Sayegh said.
Currently, it has about 20 employees and he eventually plans to hire about 80 more.
The unit’s goal is to investigate suspicious transactions by gathering information from banks, customs, the judiciary and the real estate and commercial sectors to decide if they warrant being passed onto a prosecutor.
Information about transactions not sent to the prosecutor are kept in the unit’s database. The transactions are reported by banks, border customs, and exchange houses.
“Any suspicious transaction that’s not within the pattern of the client, the bank’s system should pick it up,” Mr Al Sayegh said.
The unit is not only focused on terror financing. Money laundering is also part of its remit, and cases involving terror suspects don’t necessarily receive special treatment.
Mr Al Sayegh said transactions have been sent to the prosecutor, though the details are classified. “We are now operational,” he said.
Yet, Kuwait’s ability to stop terror funding is complicated by domestic challenges, analysts say.
