UAE unveils plan to tackle money laundering and terrorism financing

The UAE has set out a nationwide action plan aimed at combatting terrorism financing and money laundering.

The 2024-27 National Strategy for Anti-Money Laundering, Countering the Financing of Terrorism and Proliferation Financing was approved by the UAE Cabinet on Monday.

Further details on the initiative were announced on Wednesday.

It has 11 goals which outline the “legislative and regulatory reforms the UAE is taking to prevent the impact of illegal activities on society”, state news agency Wam reported.

The strategy has been developed by the General Secretariat of the National Committee using World Bank Group methodology to ensure it meets international standards.

Sheikh Abdullah bin Zayed, Deputy Prime Minister, Minister of Foreign Affairs and Chairman of the Higher Committee Overseeing the National Strategy on Anti-Money Laundering and Countering the Financing of Terrorism, welcomed the long-term strategy.

“This initiative follows the Financial Action Task Force’s decision to de-list the UAE from its Grey List in February 2024, further underscoring the UAE’s unwavering commitment to upholding the highest international standards,” Sheikh Abdullah said.

“The UAE’s proactive approach not only safeguards the integrity of the global financial system but also strengthens our position as a leading international financial centre and trade hub.

“The UAE is committed to staying ahead of emerging threats through continuous enhancement of our AML/CFT framework, ensuring our financial system remains safe, resilient, and efficient.”

The strategy is focused on risk-based compliance, effectiveness and sustainability.

These include enhancing national and international co-ordination to improve the exchange of information to ensure the supervision of steps to tackle money laundering, financial crimes and proliferation financing in the private sector, and strengthening the fight against illicit activities.

It will also help improve data collection and analysis and update the law to adapt to evolving risks and support transparency.

An emphasis will be placed on assessing the risks posed by virtual assets and rapidly advancing forms of cyber crime.

The General Secretariat of the National Committee will oversee the implementation of the plan.

Regular progress reports will be submitted to the Higher Committee for Supervising the National Strategy to Combat Money Laundering and Terrorism Financing.

Taking action

The UAE has made significant strides in the fight against financial crime in recent years.

In August, the government amended its laws on anti-money laundering and the financing of terrorism and illegal organisations.

The changes were designed to support efforts to address financial crime while consolidating the country’s technical compliance with international treaties and recommendations.

A National Committee for Anti-Money Laundering and Combating the Financing of Terrorism and Financing of Illegal Organisations has been formed as a result.

The UAE Central Bank last month imposed a fine of Dh5.8 million ($1.6 million) on a bank operating in the Emirates for breaching the country's laws on anti-money laundering and counter-terrorism financing.

In 2021, the government founded an Executive Office for Anti-Money Laundering and Counter-Terrorism Financing after passing an anti-money laundering and terrorism financing law in 2018.

The value of fines imposed by regulatory authorities in the field of Anti-Money Laundering and Counter-Terrorism Financing between January and October last year reached Dh249.2 million ($67.9 million), compared with Dh76 million in 2022.

A sign of the progress made in recent years is that the country was removed from the Financial Action Task Force’s grey list this February.

The FATF is a global body that combats money laundering and terrorism financing.

The decision to take the UAE off the watchdog’s increased monitoring list was made after a comprehensive on-the-ground review of its economy. The Emirates was placed on the grey list in 2022.