UAE's economy ministry begins inspections to ensure businesses follow rules on financial crimes

Gold dealers, estate agents, company formation agents and other professions face penalties of up to Dh5m for breaching anti-money laundering regulations

Establishments including brokers, real estate agents, auditors, dealers of precious metals and gemstones, and corporate service providers are required to register with the relevant anti-money laundering system before April 30, according to the Ministry of Economy. ReutersShow less

The UAE's Ministry of Economy began inspections of Designated Non-Financial Businesses and Professions (DNFBPs) to ensure they are following anti-money laundering and combating terrorism financing rules.

Businesses including brokers, property agents, auditors, dealers of precious metals and gemstones, and corporate service providers such as company formation agents have been urged to register with the relevant anti-money laundering bodies before April 30 to avoid being fined, the ministry said in a statement on Tuesday.

“The inspection campaign aims to ensure that the sector’s establishments follow the established regulations on anti-money laundering,” Safeya Al Safi, director of the anti-money laundering department at the Ministry of Economy, said.

“Furthermore, it focuses on ensuring the integrity and transparency of commercial transactions within the DNFBPs sector, thereby addressing illegal and unsound financial practices and suspicious activities.”

Failure to register with the goAML system set up in 2019 and the Automatic Reporting System for Sanctions Lists could result in major penalties and the closure of non-compliant organisations, officials cautioned.

The ministry extended the deadline granted to relevant companies to register with the system until the end of this month as a large number of businesses had submitted documents just ahead of the previous deadline at the end of last month. It also took into account the circumstances faced by many businesses as a result of the pandemic.

Fines for not adhering to AML regulations could range from Dh50,000 ($13,613) to Dh5 million and will come into effect from May 1, the officials said.

A new head of inspection campaigns has also been appointed to lead a series of field visits and office inspections of relevant businesses and to follow up on any compliance issues.

"Compliance and registration in the systems contribute to the development of the UAE's business environment, improving various indicators at the global level," Ms Al Safi said. "This will positively impact the business sectors by enhancing confidence in the UAE economy and increasing investment flows, business growth and recovery from the Covid-19 pandemic."

The UAE, which has strict laws to deal with money laundering and the financing of terrorism, has issued various regulations over the past couple of years to fight financial crimes.

The country launched a new agency to combat money launderers, entities and people suspected of financing terrorists and organised crime earlier this year.

The Central Bank of the UAE also instructed all hawala providers – informal fund transfer agents operating outside the banking system – to register with the central bank to strengthen the oversight of money transfers last year.