Financial Crime World

UAE’s Comprehensive CRS Compliance Programme Yields Positive Results

The United Arab Emirates (UAE) has implemented a comprehensive Customer Due Diligence (CDD) and Reporting programme in line with the Common Reporting Standard (CRS) to enhance its efforts against financial crime. This programme, developed by the UAE Ministry of Finance, consists of nine critical components designed to provide robust data validation, risk monitoring, and assessment processes.

Key Components of the Programme

The programme includes:

  • Data validation: A process to ensure that customer data is accurate, complete, and reliable.
  • Risk monitoring: Continuous monitoring of customer activity to identify potential risks.
  • Assessment processes: Regular assessments of customer risk profiles to determine compliance with AML/CFT regulations.

Implementation Strategy

To implement the programme, the Central Bank of the United Arab Emirates (CBUAE) has:

  • Conducted thematic reviews to assess compliance among licensed financial institutions (LFIs).
  • Organized awareness events to educate stakeholders on AML/CFT challenges faced by the banking industry.
  • Participated in forums to discuss anti-money laundering and combating the financing of terrorism (AML/CFT) challenges.

Guidance Documents

The CBUAE has issued guidance documents on various topics, including:

  • Transaction monitoring: A process to monitor and report suspicious transactions.
  • Sanctions screening: A process to screen customers against sanctions lists to prevent dealings with sanctioned entities.

National AML/CFT Committee (NAMLCFTC)

The NAMLCFTC, chaired by the Governor of the CBUAE, has:

  • Revised the country’s national strategy to align with risks identified in the Mutual Evaluation Report (MER) and the UAE’s National Risk Assessment.
  • Developed an enhanced National Action Plan outlining initiatives and actions to implement the MER’s recommendations.

Compliance Enforcement

The CBUAE requires all licensed financial institutions (LFIs) to comply with UAE Decree Federal Law, Executive Regulations, and any CBUAE regulations and directions. Non-compliant entities will face enforcement action, including:

  • Sanctions: Imposed on several Hawala providers, exchange houses, and banks operating in the UAE.
  • Publication of penalties: The CBUAE will continue to publish the outcome of administrative and financial sanctions.

Ongoing Efforts

The UAE’s comprehensive CRS compliance programme demonstrates its commitment to implementing effective measures to prevent financial crime and ensure transparency in the financial sector. As part of its ongoing efforts, the CBUAE will:

  • Engage with stakeholders: Regularly engage with LFIs to promote compliance and cooperation.
  • Conduct thematic reviews: Continuously conduct thematic reviews to assess compliance among LFIs.
  • Issue guidance documents: Publish guidance documents to educate LFIs on AML/CFT regulations.