The United Arab Emirates, UAE Central Bank has released new financial guidelines to assist licensed financial institutions (LFIs) which lend to cash-intensive businesses such as those in trading, transport, travel, and retail to prevent money laundering and financing of terrorism.
In the new guideline, licensed institutions that provide services to cash-intensive businesses (CIBs) must take a risk-based approach in their anti-money laundering (AML) programmes.
Customers of CIBs are to be assessed to determine their degree of risk, the regulator said in a statement on Sunday.
Cash-intensive businesses cater to a high volume of cash flows, across various industry sectors such as trading, transport, travel, retail, and wholesale, according to the central bank.
“LFIs must perform appropriate customer due diligence that comprises customer and beneficial owners identification, understanding of the customer business, and ongoing monitoring of the business relationship,” the central bank said.
Licensed Financial Institutions are to obtain appropriate information regarding the source of cash deposited in a customer’s account as well as mandate the use of Emirates IDs for cash deposits in ATMs.
The licensed financial instittutions should maintain transaction monitoring systems to identify patterns of potentially suspicious activity that may be linked to money laundering, the financing of terrorism, or a criminal offence, and submit transaction reports directly to the UAE’s Financial Intelligence Unit using the goAML portal, the statement said.
Khaled Balama, the UAE Central Bank governor said, “the new guidance affirms our commitment to implement high regulatory control over LFIs and their transactions with cash-intensive business activities and to complement with the UAE’s path to actively participate in international efforts to AML/CFT.”
UAE financial guidelines: sanctions for defaulters
A specialist court to focus on fighting money laundering and other financial crimes was set up in August by Dubai in an attempt to boost the integrity of its financial system.
Earlier this year, the Dubai Misdemeanour Court convicted eight people and three companies of cyber fraud and laundering stolen funds amounting to about Dh14 million ($3.81m).
Also in April, the court fined an exchange house operating in the country almost Dh500,000 ($136,000) for failing to achieve appropriate levels of compliance with anti-money laundering regulations.