UAE tightens measures to combat money laundering
Dubai: The Ministry of Economy (MoE) said it will continue its efforts to enhance compliance of the UAE’s business community to fight money laundering, financing of terrorism, and the financing of illegal organizations.
The ministry said the country is fully committed to achieve full compliance to the International Financial Action Task Force (FATF).
The ministry officials said that the private sector is a strategic partner in its efforts to implement the country’s international obligations in this task, particularly its compliance with legal requirements and procedures being implemented by the authorities, including the MoE.
The MoE said its efforts are directed towards meeting compliance in two main areas, which include the regulation and supervision of the Designated Non-Financial Businesses and Professions (DNFBPs) to ensure they meet the legal requirements.
Ultimate beneficial owner
The ministry is also obtaining the Ultimate Beneficial Owner (UBO) data from all private sector establishments within the country, including the non-financial free zones. This is being implemented in cooperation with Registrars of Companies across the country to ensure the completion and registration of UBO data from more than 565,000 private establishments operating in various sectors.
Oversight of DNFBPs
In the area of overseeing the DNFBPs, the ministry said the UAE remains resolute in its position to combat money laundering and terrorist financing, which aims to continuously uphold the country’s commitment to the international community and maintain the highest standards of integrity and transparency in all financial and commercial practices and confront illegal business activities.
"The Ministry of Economy has been working since the beginning of this year to register all identified DNFBPs in the goAML system, a system that has been formed to combat money laundering and Automatic Reporting System for Sanctions Lists that will help deter terrorism financing as well as the funding of illegal organizations,” said Al-Janahi.
To date, more than 80 per cent of the targeted establishments have been registered, but still 20 per cent have to be completed in both the systems, amidst the awareness campaigns and the continuous communication efforts emphasizing the mandatory registration within the given grace period and even after the deadline has been extended, which ended in early May.
Compliance is key, not fines
Financial penalties were imposed in accordance with the relevant resolutions on violating companies, recording a total of 3,083 fines, the value of each is Dh50,000.
Al-Janahi said that the ministry’s goal is to ensure compliance and not impose a fine. “We count on the partnership and cooperation of the DNFBPs to achieve the highest levels of oversight and compliance and contribute towards protecting these sectors’ investments from money laundering risks and avoid breaking the law,” he added.
Establishments may file for grievances if they believe that the fines imposed on them are unjustified and they can apply for their grievance to be reviewed by the ministry, in which the status of the establishment and the veracity of the reasons will be considered. He enumerated the four-step process when submitting grievance request.
The process include submitting a grievance request to the ministry within 15 days from the date of notification of the violation using a customized form that can be downloaded from the ministry’s website, along with supporting papers and documents.
National risk assessment
In accordance with international standards, the assessment was conducted following five main criteria, namely:
- the nature of the activity;
- the nature of the product or service;
- the nature of the customer;
- the geographical scope;
- the nature of delivery channels