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UAE Central Bank to Take Action Against Unregistered Hawala Operators

From 2nd December 2020, the Central Bank in UAE will begin taking action against the unregistered Hawala operators. No Hawala operator will be able to operate in the jurisdiction after the deadline expires on the 2nd of December. 

In a statement by the Central Bank to Khaleej Times, “ After the deadline has expired, the Central Bank will impose the necessary legal and supervisory measures available in the law. This includes imprisonment and fine, in addition to administrative penalties which may include the closure of the operating premises.”

Also known as hundi, Hawala is a procedure through which monetary value is transferred to people in other countries. Remote places of these countries utilize this procedure where they do not have access to banking services. 

Regulating Hawala is a significant key in Central Bank’s non-stop efforts to keep the transparency of transfer of funds and transections and amplify the reporting systems according to the international standards. This is especially important in accordance with anti-money laundering (AML) and Counter-Terrorism Financing (CFT).

Now registration of Hawala service provider is obligatory. Any unregistered or informal Hawala service providers operating in UAE now have to regularize their status before 2nd December 2020.