UAE Central Bank Fines Firm $490,000 for Violating AML/CFT laws

The UAE’s Central Bank has charged a financial firm Dh1.8 million ($490,000) over breaching the country’s AML/CFT laws.

The central bank of UAE has imposed a penalty of $490,000 with additional compliance requirements on a financial firm that infringed the laws of anti-money laundering and counter-terrorism.

The sanctions follow a thorough review by a third-party consultant. The examination is performed by the banking regulator revealed the high risk and repeated AML/CFT breaches from the company and operational failings from the board of directors.

The central bank did not reveal the identity of the concerned company. According to the regulator, “The findings illustrate that the finance company engaged in high-risk, repeated violations and had an overall weak compliance culture relating to policies and procedures designed for AML/CFT.”

UAE, the world’s second-largest economy,  has recently introduced several initiatives to regulate the financial sector. The government and the authorities have passed strict laws to prevent money laundering and terrorism financing and also have imposed regulations over the years to clamp down on financial crimes.  

Last month, the bank issued multiple guidance for licenced FIs, including banks, exchange houses, finance firms, insurance organisations, brokers and agents, to counter financing of terrorism and money laundering.  

The guidelines focus on using digital identification systems by licenced financial institutions to address CDD (Customer Due Diligence) responsibilities.

In 2021, UAE established the Executive Office for AML/CFT, an agency that deals with fraudsters and organisations suspected of financing terrorists and organised crime.

Also in 2020, the Ministry of Economy set up an Anti-Money Laundering department, ensuring all non-financial businesses and professionals comply with the laws.

The banking regulator instructed the finance company to address its compliance failures, directing the BODs to meet and rectify the issues related to the composition. UAE Central Bank works to ensure all finance organisations, their owners and staff follow the country’s laws, standards and global regulations to protect the transparency of concerned businesses and the financial system of the Emirates.

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