It’s no secret that the UAE is an economic hub for global and international trade and finance. With that burden though, comes heavy pressure on the government to ensure that their areas of free trade are not being misused. The UAE has always had strict AML regulations but as technology has begun to grow more advanced, their regulations have needed to stay up to par. Their new regulations were released in the summer of 2021 and all businesses, both international and domestic, that operate within the UAE must comply with these guidelines. Before addressing the regulations themselves, it’s crucial to understand the context of who these regulations affect and how they are being enforced.
These laws apply to three main categories of companies that operate in the UAE. Financial institutions, non-profit organizations and designated non-financial businesses and professions (DNFBPs). If unclear on the nature of DNFBPs, take a look at a blog we published earlier this year about them. Though a brief explanation would be companies that conduct financial activities on behalf of their customers, for example, real estate agents, lawyers, independent accountants at times as well. Out of the three categories though, NPOs have the least obligation due to the nature of their work, most of the burden falls upon FIs and DNFBPs.
As for the enforcement process, in August 2020, the Central Bank of the UAE created a department called the Anti Money Laundering and Combating The Financing of Terrorism Supervision Department (AMLD), for the sole purpose of regulating all business relating to AML. Prior to this, all matters related to money laundering were dealt with by the Banking Supervision Department but this initiative is evidence showing that the UAE has a zero tolerance policy for such crime. The AMLD have three main aims for their work, first being compliance to the UAEs AML laws and regulations, and the second being the examination of licensed FIs. Furthermore, they intend to identify threats, vulnerabilities and possible risks to the UAE’s economy and finance sector. The AMLD is actually not the only authority that is dealing with these rising issues, there are certain bodies that only operate within special economic areas but as for overall management of matters in relation to AML, the AMLD is responsible.
Now finally, as for the regulations, there is a wide variety of them as there always have been. Out of all of them though, the Idenfo team have identified the ones that require most attention. The Federal Decree-Law No. 20 and the related Cabinet Decision No. 10 in regarding to the implementation of Decree-Law No. 20.
- “Transferring or transporting proceeds of crime with intent to conceal or disguise its illicit origin;
- Concealing or disguising the true nature, origin, location, way of disposition, movement or rights related to any proceeds or the ownership thereof;
- Acquiring, possessing or using such proceeds;
- Assisting the perpetrator of the predicate offense to escape punishment.” (Kereibayev)
Staying compliant through a KYC/AML software is the way to most efficiently avoid any instances of money laundering within your company. Taking such issues lightly puts your whole company at risk because onboarding even a single customer or employee with such intentions will most probably lead to the closure of your company entirely. Ensuring the onboarding process is efficient manually is almost impossible in comparison to a software which can do more thorough work in a fraction of the time and avoid the expense of man hours for you and your company. Let Idenfo UAE show you how efficient we are able to make the onboarding process.
