Commerce ministry warns businesses against misuse of establishment bank accounts

RIYADH — The Ministry of Commerce in Saudi Arabia has cautioned business owners against any illicit activities conducted through their commercial bank accounts. The ministry stressed the critical need for vigilant monitoring of all financial transactions and transfers, and prevention of misuse of these accounts for actions that contravene regulations.

It clarified that a business establishment's bank account is exclusively meant for its commercial operations. The ministry further explained that owners must maintain a comprehensive understanding of every contract, agreement, transaction, and financial transfer involving their establishments. They are required to continuously oversee these activities to evade being held responsible for any breaches of law or criminal acts perpetrated through their accounts.

Irregular transactions involving an establishment's bank account might encompass receiving cash deposits or transfers from individuals of unknown affiliation; transferring funds domestically or internationally to entities or persons lacking a contractual connection with the business; or performing banking operations via an authorized representative without the owner's knowledge.

Such practices also involve establishing multiple bank accounts for the establishment without a legitimate business rationale or any discernible relationship among them, which could be exploited to facilitate fund transfers. Additionally, the ministry highlighted other forms of unauthorized conduct, such as engaging in financial transactions, including deposits, transfers, withdrawals, and purchases, with individuals or business entities that are not part of the establishment's commercial operations.