The Fight Against Financial Crime in the Middle East Exchange house in UAE fined Dhs504,000 by Central Bank

  • An exchange house in UAE was reportedly fined Dhs504,000 by the Central Bank of the UAE (CBUAE). The CBUAE confirmed in an announcement that the exchange house was fined because it was operating in the country with weak anti-money laundering (AML) and anti-terrorism compliance framework. In fining the exchange house, the CBUAE took into consideration the exchange house’s poor compliance history. The CBUAE did not specify the name of the exchange house, although it added that the fine was issued “pursuant to Article 14 of the Federal Decree Law No. 20 of 2018 on Anti-Money Laundering and Combating the Financing of Terrorism and Financing of Illegal Organisations,” reported state-run news agency WAM. As the supervisory authority of exchange houses operating in the UAE, the CBUAE said that it is committed to ensuring all exchange houses abide by UAE laws and the regulations and standards issued by it to safeguard the transparency and integrity of the transactions of exchange houses. Also, last month, the CBUAE fined 11 banks operating in the country a total of Dhs45.75m. The penalties were based on the banks’ failures to achieve appropriate levels of compliance regarding their anti-money laundering and sanctions compliance frameworks as at the end of 2019. Whilst the reopening of prominent exchange houses including UAE Exchange and Xpress Money shows a promising step in the right direction, the continuing decline of exchange houses down from about 160 to 80 in the last 5 years with potentially more to follow in the next 5 years, gives cause for concern.

  • Kharis & Knoble Risk and Compliance Consultants specialises in providing support for financial services companies in the Middle East and Africa to leverage an effective and sustainable AML, Fraud and Anti Bribery and Corruption environment as a competitive advantage and driver of business growth. We have in-depth understanding of local markets and shari’ah principles and promote a stable and resilient financial system whilst turning compliance from a cost centre to a revenue source by reducing overhead, identifying revenue generating opportunities and helping get products to market quicker. We are experts at translating high risk to medium and low risk via innovative bespoke risk mitigation tools and solutions. Our solutions span critical business challenges in technology, business processes, environmental, social, and corporate governance (ESG), risk, and compliance and general data protection regulation (GDPR). We deliver deep expertise, objective insights, a tailored approach, and unparalleled collaboration to help our clients confidently face the future and progress towards standards that are more closely aligned with international best practice. Bisi Giwa April 21, 2021

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