The Central Bank of the UAE has issued new guidelines governing the implementation of sanctions related to anti-money laundering and combatting the financing of terrorism (AML/CFT).
The guidance, which came into effect on July 8, instructs licensed financial institutions to “develop, implement and regularly update an appropriate sanctions compliance programme encompassing a robust risk assessment, screening process and staff training programme”, the regulator said in a statement on Monday.
“This should be applied across their institutions, including branches, subsidiaries, and other entities in which LFIs hold a majority interest.”
LFIs include banks, finance companies and foreign exchange businesses. The guidance has been issued to help them effectively meet their obligations and they must be able to demonstrate compliance within a month of them being issued, the central bank said in its statement.
The UAE has strict measures to combat money laundering. The country set up a new agency this year to identify money launderers and those suspected of financing terrorists and organised crime. The Central Bank of the UAE regularly issues guidelines on how companies can assess money-laundering risks.
The guidelines announced on Monday are in addition to rules governing sanctions implementation issued in May for non-financial businesses and professions by the Executive Office of the Committee for Goods and Materials Subject to Import and Export Control. The executive office is the central body overseeing the implementation of sanctions in the UAE.
“The threat of money laundering and terrorist financing on the UAE’s financial system is one that we aim to address through rigorous regulatory oversight and continuous clarification of LFIs’ obligations,” said Khaled Al Tameemi, governor of the Central Bank of the UAE.
An automatic reporting system sends notifications by email whenever a person is added to or removed from the UN Security Council's or the UAE's sanctions list. LFIs must register on the executive office’s website to receive these notifications, the central bank said.
“They are required to regularly screen their databases and transactions against the names that appear on the aforementioned lists. When a match to a listing is found through the screening process, LFIs must, within 24 hours without delay and prior notice, freeze the funds of the listed individuals or entities,” it said.
LFIs must immediately notify the central bank and the executive office of any freezing measures and/or attempted transactions, it added.
