The UAE Central Bank has imposed a fine of Dh1.8 million ($490,129) and stricter compliance requirements on a finance company for breaching the country’s laws on anti-money laundering and counter-terrorism financing (AML/CFT), and the organisation of financial institutions and activities.

The sanctions follow a review by a third-party consultant and an examination conducted by the banking regulator that found high risk and repeated AML/CFT breaches by the company, as well as operational failings by the board of directors, it said on Thursday.

The Central Bank did not name the concerned company.

“The findings illustrate that the finance company engaged in high-risk, repeated violations and had an overall weak compliance culture relating to policies and procedures designed for AML/CFT,” the regulator said.

The UAE, the Arab world’s second-largest economy, has introduced a number of initiatives to regulate the country’s financial sector in recent months.

It has passed strict laws to prevent money laundering and the financing of terrorism, and has issued regulations over the years to clamp down on financial crimes.

The Central Bank issued new guidelines last month for licensed financial institutions — including banks, finance companies, exchange houses, insurance companies, agents and brokers — to combat money laundering and the financing of terrorism.

The guidelines focus on the use of digital identification systems by licensed financial institutions to address customers’ due diligence obligations.

In 2021, the UAE established the Executive Office of Anti-Money Laundering and Counter-Terrorism Financing, an agency to deal with money launderers, as well as organisations and people suspected of financing terrorists and organised crime.

In 2020, the Ministry of Economy set up an anti-money laundering department to ensure that all non-financial businesses and professionals comply with local laws.

The banking regulator instructed the finance company to address its compliance failures, and directed the board of directors to meet and rectify issues related to its composition.

The Central Bank works to ensure that all finance companies, their owners and staff abide by the country’s laws, regulations and standards to protect the transparency and integrity of the concerned businesses and the financial system of the Emirates.

Source: UAE Central Bank fines company $490,000 for violating anti-money laundering law (