The Central Bank of the UAE has imposed a total penalty of Dh18.1 million ($4.9 million) on two branches of foreign banks in the country due to violations of anti-money laundering regulations.
### Details of the Fines
The regulatory authority announced a fine of Dh10.6 million for one bank and Dh7.5 million for the other, although it did not specify the names of the institutions involved.
### Reasons for the Penalties
The sanctions were attributed to “non-compliance and failures” in adhering to the established framework for anti-money laundering, countering the financing of terrorism, and regulations concerning illegal organizations, as indicated in the Central Bank’s statement.
### Basis for the Fines
These fines were determined based on the outcomes of inspections conducted by the banking authority.
### Statement from the Central Bank
In its statement, the UAE Central Bank emphasized its commitment to ensuring that all financial institutions and their personnel comply with UAE laws and regulations aimed at maintaining the transparency and integrity of financial operations, which is essential for protecting the UAE’s financial framework.
### Previous Actions
Last week, an exchange house was fined Dh200 million for similar infractions concerning anti-money laundering regulations, and a Dh500,000 penalty was levied on a branch manager, who has been prohibited from working in any licensed financial institution in the UAE.
### Ongoing Efforts Against Financial Crime
In recent years, the UAE has made significant strides in combatting financial crime. Effective measures to address money laundering and terrorism financing are crucial for the stability of both the international financial system and national economies, as highlighted by the International Monetary Fund.
### Recent Strategic Developments
Last year, the UAE revealed a strategic plan to enhance its measures against illicit financial activities, launching the 2024-2027 National Strategy for Anti-Money Laundering, which outlines 11 objectives for legislative and regulatory reforms to mitigate the effects of illegal activities on society. This strategy was developed by the General Secretariat of the National Committee, using methodologies from the World Bank Group to ensure alignment with international standards.
### Legislative Amendments
In August, amendments to laws addressing money laundering and the financing of terrorism and criminal organizations were enacted by the government, which also established a national committee focused on these issues. The UAE’s Executive Office for Anti-Money Laundering and Counter-Terrorism Financing was formed in 2021 following the enactment of relevant legislation back in 2018.