United Arab Emirates

New Documents

The British Virgin Islands Financial Services Commission and the Abu Dhabi Global Market Registration Authority entered into an agreement to cooperate on cross-border monitoring of financial businesses.

The Dubai Financial Services Authority published volume 17 of its DFSA in Action annual report, which summarizes the supervisory and enforcement actions of the regulator during the course of the 2020 year.

News

Enforcement Actions

The Central Bank of the United Arab Emirates issued financial penalties against two exchange houses for weak anti-money laundering and counterterrrorist financing frameworks, one for AED $500,000 and another for AED $950,000.

The Dubai Financial Services Authority fined the Dubai, United Arab Emirates-based financial services company $612,790, including $261,154 in disgorgement, for multiple serious breaches from conducting an illegal cash service for clients that increase the risk of money laundering.


Important Facts

  • The U.S. State Department identifies the United Arab Emirates (UAE) as a jurisdiction of primary concern. Though a stable regional hub for transportation, trade and financial activity, the UAE has expanded its financial services businesses and foreign trade zones, thus opening itself to be misused by illicit actors who exploit the UAE’s open business environment, global banks, exchange houses, and global transportation links to undertake illicit financial activity. Such bad actors use UAE’s complex and uneven regulatory environment, to facilitate bulk cash smuggling, trade-based money laundering and transfer of illicit proceeds. Transfers of illicit funds usually occur through commodities used as counter-valuation in hawala transactions or through trading companies illegally operating as exchange houses. Other money laundering vulnerabilities within the country include the illicit transfer of funds from narcotics produced in Southwest Asia; real estate sector; misuse of international gold and diamond trade; and use of couriers to transfer illicit funds. The UAE has comprehensive know your customer and suspicious transactions reporting regulations and permits its Central Bank freeze assets of suspicious institutions or individuals.  Additionally, the UAE has enhanced due diligence procedures for politically exposed persons, both foreign and domestic, as well as a record exchange mechanism with other governments (excluding the United States).
Source: 2019 International Narcotics Control Strategy Report (INCSR)  

Rankings

FATF i

Technical Effectiveness
Compliant : 5 High :
Largely Compliant : 15 Substantial :
Partially Compliant : 18 Moderate :
Non-Compliant : 11 Low :

BASEL i

Rank : 37/141
Score : 5.89/10

TRANSPARENCY INTERNATIONAL i

Rank : 21/180
Score : 71/100

Tax Justice Network i

Rank : 10/133
Score : 78/100