UAE Firms Must Disclose UBO’s to Avoid Dirty Money Watch List

500,000+ firms in the UAE (United Arab Emirates) face disclosure of their Ultimate Beneficial Owners (UBOs) as the Middle East financial hub strives to avoid inclusion in the money laundering watch list. 

The firms are required to disclose their UBO’s by Wednesday (7 July 2021) or face hefty fines and penalties. 

The disclosed information about beneficial and legal owners will remain only with the government and will not be disclosed publicly, as mentioned under their legislation which was passed last year. Financial transparency advocates state that full disclosure would be the gold standard, although only a handful of countries are implementing this measure as yet. 

While the Financial Action Task Force (FATF) has not commented on the subject, it redirected Reuters to a 2020 report that states “fundamental and major improvements” were needed by the UAE to avoid being placed on FATF’s ‘gray list’ of countries under increased monitoring.

Countries that are named in the gray list risk face reputation damage, increased transaction costs, and face trouble accessing global finance. 

The UAE has been working towards removing the perception that it poses as a hotspot for criminal activities. In February, the government created an Executive Office particularly for Anti-Money Laundering and Counter-Terrorism Financing (AML/CFT).