Know Everything About Anti-Money Laundering

Anti-Money Laundering

The UAE is renowned throughout the world as a friendly and open business environment. It is only one of several factors attracting businesspeople from around the world to live and work in the Emirates.

The UAE enforces several laws intended to prevent money laundering to compete on an even playing field with other economic giants like the EU and US.

Anti-money laundering: What is it?

Anti-money laundering laws oversee the source, upkeep, and transfer of monies in the United Arab Emirates. The legislation’s objectives are to maintain the nation’s compliance with other international legal systems and improve openness.

This legislation consists of two distinct laws: No. 1/2004 Counterterrorist Financing and No. 2/2002 Anti-Money Laundering (AML) (CTF).

What regulations apply to AML in the UAE?

According to Federal Decree No. 20 of 2018 against the use of money, it is unlawful to:

  • Transfer or move the proceeds of crime with the goal of hiding or disguising their illegal source.
  • conceal or misrepresent the true nature, source, location, method of disposition, transportation, or ownership rights of any earnings.
  • Obtain, hold, or employ such proceeds.
  • help the person who committed the predicate crime avoid punishment.

Banks and companies like insurers and brokers must adhere to Know Your Customer (KYC) laws to ensure total compliance with anti-money laundering regulations. This means that such organisations are required to confirm each customer’s identity and keep transaction records for all transactions above $545 for account holders and $10,900 for non-account holders. These documents must be preserved for at least five years.

Who is required to sign up for AML?

AML regulations do not just apply to the financial industry. Other companies that must register for and follow AML regulations include banks, real estate agents, brokers, gem and precious metal dealers, accountants, auditors, and corporate service providers.

What sanctions apply to AML in the UAE?

Anti-money laundering laws cover a variety of offences, ranging in seriousness from failing to recognise suspicious activity to knowingly aiding it. Such offences also carry a wide range of penalties.

There is a jail sentence for the most serious offences is ten years, and fines can reach AED 1 million. The maximum fine for a secondary offence, such as failing to prevent or disclose money laundering, is AED 100,000. For this kind of offence, there is no set minimum or maximum punishment in prison. Therefore, if you want to know more about the rules and regulations in the UAE, then check the official website of the Meydan Free Zone.