UAE Central Bank revokes licence of exchange house for regulatory misconduct

Al Rasheed exchange suppressed remittance turnover, failed to meet liquidity requirements and engaged in anti-money laundering malpractice, a probe found

The UAE Central Bank has introduced a series of measures to regulate the financial sector in recent months. Photo: UAE Central Bank

The UAE Central Bank revoked the licence of an exchange house operating in the Emirates and struck off its name from the register for regulatory misconduct and compliance failure.

The sanction is the result of the findings of an examination conducted by the banking regulator, which revealed "serious regulatory misconduct" by Al Rasheed exchange house, it said in a statement on Monday.

“The exchange house was found to have been deliberately suppressing remittance turnover, failing to meet its liquidity requirements, providing incorrect information to the Central Bank, engaging in serious anti-money laundering malpractice and transferring its licence without obtaining a letter of no objection from the CBUAE,” the regulator said.

The UAE, the Arab world’s second-largest economy, has introduced a number of measures to regulate the country’s financial sector in recent months.

It has passed strict laws to prevent money laundering and the financing of terrorism, and has issued regulations over the years to clamp down on financial crime.

The UAE Central Bank issued new guidelines last month for licensed financial institutions — including banks, finance companies, exchange houses, insurance companies, agents and brokers — to combat money laundering and the financing of terrorism.

In 2021, the UAE established the Executive Office of Anti-Money Laundering and Counter-Terrorism Financing.

In 2020, the Ministry of Economy set up an anti-money laundering department to ensure that all non-financial businesses and professionals comply with the laws.

Al Rasheed exchange was found to have a weak compliance framework and had failed to comply with its regulatory obligations.

The time set for submitting an appeal has expired and none was filed, the regulator said.

The Central Bank works to ensure that all exchange houses, their owners and staff abide by the UAE laws and regulations to safeguard the transparency and integrity of the UAE financial system, the statement said.