Financial Crime World

UAE Central Bank Issues Guidelines on Anti-Money Laundering/Combating the Financing of Terrorism Measures Amid COVID-19 Pandemic

The UAE Central Bank has issued guidelines to Financial Institutions (FIs) and Designated Non-Financial Businesses and Professions (DNFBPs) to emphasize the importance of Anti-Money Laundering/Combating the Financing of Terrorism (AML/CFT) measures in light of the COVID-19 pandemic.

Key Guidelines

The guidelines are based on Cabinet Decision No. 10 of 2019 regarding the Implementing Regulation of Federal Law No. 20 of 2018 on AML and CFT and Illegal Organisations. The key points from these guidelines include:

Revisiting Risk Assessment and Control Frameworks

  • FIs and DNFBPs should revisit their risk assessment and control frameworks to ensure they are effective in identifying and mitigating money laundering and terrorist financing risks.
  • These revised frameworks should take into account the current COVID-19 pandemic and its impact on financial transactions.

Non-Static Customer Identity Documentation

  • With the UAE Cabinet’s recent approval of new decisions related to preserving health and safety, FIs and DNFBPs are expected to keep up with these developments and their impact on AML/CFT systems and controls.
  • Encouraging customers to use government smart services for necessary identification document renewals is also recommended.

Transaction Monitoring

  • Due to altered patterns of normal and suspicious transactional behavior as a result of the COVID-19 pandemic, FIs and DNFBPs should carefully analyze transactions to distinguish between new normal patterns and suspicious behavior.
  • Their systems of monitoring and alerts should be adjusted accordingly to ensure effective detection and reporting of suspicious transactions.

Suspicious Transaction Reporting

  • Supervisory Authorities expect all FIs and DNFBPs to report suspicious transactions through the FIU’s goAML reporting platform in a timely manner.
  • If operational challenges arise due to COVID-19, contact with the FIU should be made for interim reporting arrangements.

Emphasis on AML/CFT Measures

The guidelines emphasize the importance of AML/CFT measures during this critical time, highlighting potential risks such as:

  • Financial fraud and exploitation scams
  • Illicit fundraising for charitable causes without a government permit
  • Cybercrimes like phishing schemes