As the global initiative to combat financial crimes has gained momentum in recent times, the UAE has taken a series of actions to improve efforts against money laundering and terrorism financing. As part of this, several anti-money laundering (AML) regulations were updated in addition to introducing new reforms. The UAE’s AML laws have made it mandatory for Financial Institutions (FIs), Designated Non-Financial Businesses and Professions (DNFBPs), and Virtual Asset Service Providers (VASPs) to have proper AML measures in place.
AML Compliance Requirements for Businesses
Below we have listed the AML compliance obligations for businesses in the UAE.
- Registration on goAML
goAML is a globally adopted software solution for businesses to report any detected suspicious transactions. goAML registration is mandatory for FIs and DNFBPs in the UAE.
- Appointment of a Compliance Officer
It is mandatory to appoint a compliance officer to oversee the internal AML program of the company.
- Develop and Maintain Internal Policies and Procedures
Your organisation must have internal policies, procedures, and controls to mitigate money laundering risks.
KYC (Know Your Customer) process involves verifying the customer’s identity through reliable documents and assessing the associated risk.
- Sanctions Screening
Sanctions screening involves checks to ensure the customer is not enlisted in the UAE’s Terrorist List or the UN’s Consolidated List. The screening is conducted based on the individual’s name and nationality. Any detected match must be duly reported.
- Risk Profiling
Risk profiling involves assessing the associated risks of each customer on the basis of aspects like nationality, business location, transaction value, PEP status, etc.
- Enhanced Due Diligence
Enhanced Due Diligence involves additional thorough checks on customers deemed as high-risk or Politically Exposed Persons (PEPs).
- Record Keeping
All records, documents, and other data pertaining to the customer’s identity and transactions must be maintained in the specified format.
Penalties for Non-Compliance with AML Regulatory Requirements
Violation of AML regulations can result in hefty fines. For instance, failure to provide proper AML training to staff can result in a fine of AED 50,000 or more. On the other hand, severe violations such as not taking necessary actions for customers enlisted in the UAE or international sanction lists may result in fines amounting up to AED 1 million.
Why You Need To Outsource AML Compliance Services?
By outsourcing AML compliance services, you are guaranteed dedicated expert support for KYC, CDD, and other aspects of AML compliance. As a result, your staff can now focus on the business’ core aspects. Having dedicated support for AML compliance ensures that your business is free from any ML/FT risks and remains compliant with the AML regulations in the UAE.
InZone is a leading corporate services provider in the UAE. Our experts can help you fulfill AML compliance requirements in the UAE. If you would like to know more about how we can assist you with AML compliance, please contact us.