By Dan Byrne for AMLi
TWO HUNDRED UAE law firms have lost their licences for at least one month following breaches of anti-money laundering regulations, the country’s Ministry of Justice has said.
The firms involved have also received fines of up to €1.1 million and a call to take “whatever measures necessary to ensure anti-money laundering and anti-terrorist financing obligations are fulfilled.”
Announcing the suspensions Wednesday, the UAE Ministry of Justice said they arose from multiple failures ranging from not appointing a compliance officer, not filling out a government-mandated questionnaire on AML laws, and not updating data as requested by authorities.
“The fight against money laundering and terrorist financing is of utmost priority for the UAE,” the Ministry of Justice said in a statement.
It also stressed that authorities had previously offered help in the form of online meetings and workshops to explain legal requirements to firms. This was in August 2020, after the most recent update of legislation.
The UAE, although small, is a major player in global finance and was evaluated by the Financial Action Task Force (FATF) earlier this year on the progress of their AML capabilities.
While FATF acknowledged the “strengthened legal framework” of the Emirati Government, it noted that the UAE was a major global financial centre and trading hub, fuelled by its position of power in industries like oil and diamonds, as well as its desirable geographical location at the crossroads of continents.
Because of these factors, the UAE needed to take urgent action to “effectively stop the criminal financial flows that this attracts,” FATF said in April.
Among the risks of concern to FATF were the country’s 39 different company registries and subsequent potential misuse of ‘legal persons’, as well the lack of uptake on international legal help when money laundering investigations were pursued.
The UAE Central Bank said in September that it was committed to working alongside other central banks and monetary authorities who are working to stem the flow of dirty money across the world.
The Ministry of Justice confirmed that the 200 suspended licences would be reinstated upon confirmation that firms had fulfilled their obligations under a Ministerial Resolution aimed at combatting money laundering.
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