UAE at Risk of Landing on Watchlist over Money Laundering
The United Arab Emirates is not making enough to counter money laundering despite current progress, and chances are landing on an international watchlist, a global dirty-money watchdog – the Paris-based Financial Action Task Force (FATF) – stated on Thursday.
The UAE, which constitutes the region’s financial and commercial center Dubai, will promptly be placed under a year-long observation by FATF.
“The United Arab Emirates recently increased its legal framework to combat money laundering and terrorist funding, but, as a significant global financial market and trading center, it must take the urgent response to efficiently stop the criminal financial courses that it attracts,” the FATF declared in a statement.
The intergovernmental body stated that significant or fundamental reforms are demanded in 10 of 11 areas evaluated for countering money laundering and the funding of “terrorism” and weapons of mass destruction.
“The UAE has achieved positive results in investigating and prosecuting the financing of terrorism,” the FATF recorded, “but its insufficient number of money laundering prosecutions and condemnations, especially in Dubai, is a concern provided the country’s risk profile.
“The watchdog told UAE authorities are not entirely utilizing financial intelligence to root out money laundering or track the proceeds of illegal financial activities.
The report, which got 14 months to assemble and required a visit to the UAE in July, gave a “low” rating for investigation and prosecution of money laundering and a “neutral” rating for preventive measures and financial penalties associated with countering the financing of “terrorism.”
If the UAE loses to improve, it could get itself alongside states such as Syria, Yemen, and Pakistan, which the FATF considers to have “necessary insufficiencies.”
The UAE has tightened financial regulations in current years to try to overcome an understanding among some foreign investors that it is a sensual spot for illegal money flows.
It declared a new anti-money laundering and terror financing law in 2018 and has also operated with the United States to employ sanctions to armed organizations.
The FATF said authorities must plug loopholes in the property and precious-metal sectors that can be utilized by professional money launderers. It also pressed the UAE to actively seek international money laundering networks and enhance formal cross-border cooperation.
The report further asserted there was a “noticeable absence” of steady investigations and prosecutions for money laundering events linked to high-risk crimes and areas considered high-risk, such as money transfer.
Within 2013 and 2019, the UAE prosecuted 92 people and sentenced 75 for “terrorism” funding ventures, FATF stated, while there were 50 prosecutions and 33 certainties in money laundering incidents within 2013 and 2018. Amongst those, Dubai had only 17 money laundering prosecutions over five years.