UAE to Increase Scrutiny of Financial Institutions Under New AML Strategy

Financial institutions in the United Arab Emirates (UAE) will face greater scrutiny as part of the country's newly approved anti-money laundering (AML) plan for 2024-2027. The UAE cabinet has officially endorsed the National AML Strategy, which revolves around 11 key objectives.

Among these goals are enhancing data collection efforts and a commitment to “continuously updating” the country’s AML regulations. The UAE has emphasized its intention to “strengthen oversight of financial institutions” as part of the strategy. Additionally, similar measures will be applied to “designated non-financial businesses and professions,” though the specifics of these actions were not outlined in detail.

A significant focus of the strategy will be addressing the risks associated with “virtual assets and rapidly advancing forms of cybercrime,” reflecting the growing concerns surrounding emerging financial technologies and digital threats.

This comprehensive AML plan comes ahead of the UAE’s next assessment by the Financial Action Task Force (FATF), which will take place between 2025 and 2027. The country had previously been placed on FATF's ‘grey list,’ a status often leading to a reduction in international investment. However, the UAE was removed from the grey list earlier in 2024, a decision that drew criticism from some analysts.

Critics argued that the UAE had not made sufficient strides in combating financial crime to justify the removal. As a result, UAE officials will need to demonstrate ongoing efforts to avoid being grey-listed again in the future.

In response to these concerns, the UAE has taken several steps to improve its approach to AML. These measures include pledging to overhaul two critical AML committees and temporarily halting production at gold mines suspected of involvement in money laundering activities.

The new strategy signals the UAE’s intent to remain vigilant and strengthen its financial crime framework, especially as the FATF evaluation draws nearer.

By fLEXI tEAM