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money laundering crime in UAE

Anti money laundry in UAE

The United Arab Emirates (UAE) has implemented strict anti-money laundering (AML) measures to prevent money laundering and terrorist financing activities within the country. The AML framework in the UAE is regulated by the Central Bank of the UAE and the Financial Intelligence Unit (FIU).

The AML regulations in the UAE apply to all financial institutions, including banks, insurance companies, and money exchange companies. These institutions are required to establish and maintain an effective AML program that includes customer identification, customer due diligence, monitoring of transactions, and reporting of suspicious transactions to the FIU.

The UAE has also established a regulatory regime that includes strict supervision and enforcement measures to ensure complia

money laundering with AML regulations. The country has implemented a comprehensive legal framework that criminalizes and terrorist financing activities, with severe penalties for non-compliance.

In addition to regulatory measures (AML/CFT Law UAE), the UAE has also signed several international agreements to strengthen its AML efforts. For example, the UAE is a member of the Financial Action Task Force (FATF), an international organization that sets global standards for AML and counter-terrorism financing (CTF). The UAE is also a member of the Egmont Group, which is a global network of financial intelligence units.

Overall, the UAE has implemented a comprehensive and effective AML regime to combat money laundering and terrorist financing activities within the country.

The crime of money laundry in UAE

First and foremost, the crime of money laundering is defined as a set of financial operations aiming at concealing the illegal source of funds and showing them as funds obtained from a legitimate source, contrary to the truth. Behind every money laundering incident that is revealed to the concerned authorities, there are one or more crimes, which may be hidden or undiscovered, and hence the crime of money laundry rises to the level of organized crime, through which criminals obtain money, try to enter it into the official public order of the target country with operations aimed at concealing the source thereof, and then legalizing it.Hence, money laundering is an immoral act linked to other crimes, which tear down people and societies – such as drugs, arms or human trafficking, etc. – according to the International Financial Action Task Force (FATF) classification.

In addition to the immoral act of the crime mentioned above, it further has a severe negative impact on the economy of States, as it leads to low real growth rates, destabilization of the financial and banking system, prices fluctuations, and the consequent decline in national production, and lack of competition among active companies. Accordingly, this results in a severe negative impact on the overall economy of the State.

In view of the risks and disadvantages of that crime, the United Arab Emirates has confronted that crime. It has been proactive in building an integrated system of laws to combat money laundering and the financing of terrorism. Among the most prominent enactments and legislation in this regard are Federal Decree-Law No. 20 of 2018 on Anti-Money Laundering and Combating the Financing of Terrorism and Illegal Organizations, as well as the executive and regulatory decisions and regulations that emerged from the Decree-Law as mentioned earlier, in addition to developing the electronic systems that ensure the implementation of the law and achieve supervision by the best international standards.

Therefore, it is the duty of the popular sector to interact with government efforts and stand united with the ruling authority to confront and combat that heinous crime.

Represented by the Ministry of Economy, the State has developed specialized administrative units within Money Laundering Department at the Ministry, concerned with inspection and monitoring of the non-financial business and professions sector, including the sector of real estate agents and brokers, precious metals dealers and auditors, etc.

The responsible authorities further laid down requirements and conditions that establishments must apply and comply with for the State to monitor such establishments and activities.

according to Money laundering UAE Law, Federal Decree-Law No. 20 of 2018 was also issued, concerned with the definition of the crime and its elements, and showed its constituents, descriptions, and related crimes.

The said Decree-Law gave the powers that the Public Prosecution may, on its initiative or at the request of law enforcement authorities, when there is sufficient evidence of the crime, issue the necessary decisions towards the institution of criminal proceedings against the perpetrator of the crime, as well as issue decisions and take the measures needed to protect intelligence information and confidential sources revealing the crime.The National Anti-Money Laundering and Combating the Financing of Terrorism Committee was established under the above Decree-Law and is responsible for developing a national strategy to combat crime in coordination with the concerned authorities.

The Decree-Law also granted the supervisory authorities in the State, each according to its competence, the tasks of supervision, control, and follow-up to ensure compliance with the provisions provided for in the law as mentioned earlier and its executive regulations.

The legislator then mentioned in the Decree-Law in detail the punishments prescribed when the criminal commits its crime, which includes a liberty deprivation punishment, as well as a financial fine, as it stipulates that the criminal shall be punished by imprisonment for a period not exceeding ten years [ten years] and a fine of not less than 100.000 dirhams [one hundred thousand dirhams] and not more than 5,000,000 dirhams [five million dirhams] or one of these two punishments.

The law increased the punishment making it between temporary imprisonment and a fine of not less than 300,000 dirhams [three hundred thousand dirhams] and not more than 10,000,000 dirhams [ten million dirhams] in certain cases, including – abuse of the accused to the authority or powers vested in them by virtue of their position – as well as if the crime was committed through a non-profit association, as well as the commission of the crime through an organized criminal group and finally in the case of recidivism.

Furthermore, Punishment for money laundering in UAE, the legislator also punished the case of an attempted crime. In respect of the seriousness of the said crime, the above Decree-Law provided that this crime – is not time-barred – as well as the punishment imposed on the accused when the accusation is proven, the punishment inflicted in respect of it does not expire with the lapse of time, as well as civil cases emanating therefrom or related thereto.

With that said, we stand united with our rational State, and we call on all sects and components of society not to be involved in crimes to preserve the State and the people from tampering with the capabilities of our rational State.

May Allah protect His Highness, the Ruler of the State.

And May Allah protect the United Arab Emirates.
Legal Counsel,

Mahmoud Fahmy

FAQ about Crime of Money Laundering

1- What is money laundering in Dubai? 

Money laundering is the process of disguising the proceeds of criminal activity as legitimate funds. It involves taking money that was obtained through illegal means, such as drug trafficking or fraud, and making it appear as though it came from a legal source.

2- Is money laundering a crime in the UAE?

Yes, money laundering is a crime in the UAE, and it is punishable by law. The UAE has enacted a number of laws and regulations to combat money laundering, including Federal Law No. 4 of 2002 on Criminalization of Money Laundering.

3- What are the penalties for money laundering in the UAE? 

The penalties for money laundering in the UAE can include imprisonment, fines, and confiscation of assets. The severity of the penalty depends on the specific circumstances of the case, including the amount of money involved and the nature of the underlying criminal activity.

4- Who is responsible for preventing money laundering in the UAE?

The UAE has established a number of government agencies and regulatory bodies to prevent money laundering, including the UAE Central Bank, the Ministry of Economy, and the Dubai Financial Services Authority. Financial institutions and other businesses are also required to have anti-money laundering programs in place to detect and prevent suspicious activity.

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