The authorities conducted a fresh inspection of 67 currency exchange firms in the country after the Bank of the Lao PDR (BOL) recently terminated business licences for currency exchange.
After the BOL issued a notification terminating the business licences of 113 commercial bank representative exchange shops last month, the central bank coordinated with the Economic Police to monitor illegal currency exchange activities. They re-inspected 67 targeted firms, including 30 in Vientiane and 37 in other areas, according to the Monetary Policy Department of the BOL.
Through the inspections, most currency exchange activities have been stopped, but there are still some outlets that are still active in illegal currency exchange services, such as open currency exchange without a storefront.
These outlets make announcements about exchange rates and places to contact to buy and sell currency openly through various media, such as Facebook and Whatsapp, without fear of legal regulations. In response to this issue, police officers and employees from the BOL have educated them to recognise and understand the laws and regulations. They also warned the violators to stop operating their currency exchange business immediately. If it is found that such currency exchange businesses continue to be active, more severe measures will be taken as stipulated in the relevant laws and regulations. Currently, according to the laws of the Lao PDR, only commercial banks located in the country can provide currency exchange services, and they must implement the exchange rate according to the regulations of the BOL. Providing foreign exchange services without permission and using foreign exchange services provided by persons other than banks is a violation the Foreign Exchange Management Law. Those violating the law will have to face educational measures and a fine of 10 percent of the value of the violation, according to Articles 54 and 55 of the law. Individuals or legal entities who harm the exchange rate by spreading fake news, misrepresenting information about factors that affect or determine the exchange rate, buy and sell currency without following the regulations of the BOL or not in accordance with the reality, and cause damage to the economic, financial and currency systems of Laos will be punished with imprisonment for one year to five years and fines ranging from 50 million kip to 100 million kip. The provision or use of illegal exchange services has had negative impacts on society, such as setting exchange rates that are not in line with the realities of the economy, stirring up exchange rates that cause economic damage, causing fraud, lying and deception, and making society unstable.