Ministry of Economy issues 8 violations amounting to AED 1.35 million against gold trading establishment

Ongoing inspection campaigns ensure compliance of DNFBPs with regulations approved for countering money laundering and combating financing of terrorism

Abu Dhabi, 23 May 2021: The Ministry of Economy (MoE) is conducting an extensive inspection campaign targeting establishments belonging to the Designated Non-Financial Businesses and Professions (DNFBPs) sector to ensure their compliance with the regulations approved for countering money laundering and combating the financing of terrorism and illegal organizations. DNFBP establishments were allowed 3 months’ time to register in the two systems and to put in place due diligence procedures that enable them to file suspicious activity reports, before the end of the grace period in the beginning of May.

The inspection campaigns detected violations committed by a number of establishments by failing to register procedures and failing to adopt the necessary measures to confront money laundering. The violations committed by a large gold trading group in Dubai amounted to AED 1 million and 350,000.  Three companies belonging to the group were issued fines of AED 450,000 each for violations of 8 aspects of the executive regulations.

The violations included failure to adopt necessary measures and procedures to determine crime risks in the respective field of work (AED100,000); failure to reduce risks (AED 100,000); failure to establish internal policies, controls and procedures commensurate with the volume of its business that would enable it to manage risks (AED 50,000); failure to adopt necessary measures and procedures to reduce the identified risks according to the results of the national risk assessment or to the results of the self-assessment of the nature and volume of its work (AED 50,000); failure to take the necessary measures to understand the purpose and nature of the business relationship, or not collecting information related to this purpose or when seeking information related to this purpose when needed (AED 50,000).

Violations also included the failure to create an independent audit function to test the effectiveness and efficiency of internal policies, controls and procedures for combating crime (AED 50,000); failure to create records to save financial transactions with clients in an irregular manner that does not allow data analysis and tracking financial operations; and failure to keep records of financial transactions and the documents related to them for a period of five years from the date of completion of the process or the termination of the business relationship with the customer or from the date of the end of the inspection process on his facilities (AED 50,000).

The Ministry of Economy called on establishments to speed up the amendment of their conditions in order to avoid penalties stipulated by Federal Law No. 20 of 2018 on countering money laundering, combating the financing of terrorism and financing illegal organizations, and its executive regulations and related decisions, which start from AED 50,000 and go up to AED 5 million. The measures could even lead to the suspension of the license or closure of the facility itself, the Ministry said, indicating that a grievance could be raised against the detected violations within the legal period specified within 15 days from the date of notification of the violation in accordance with the executive regulations of the law.

Safeya Al Safi, Director of the Anti-Money Laundering Department at the Ministry of Economy, confirmed the continuation of the ministry's campaigns to ensure that companies comply with the provisions of the Federal Law and its implementing regulations. She noted that the inspection campaigns have been designed to ensure that the sector’s establishments follow the regulations in place with regard to countering money laundering, in order to ensure the safety and transparency of transactions.

Al Safi said that registration in the approved regulations and the adoption of necessary procedures is a national duty for all DNFBP establishments, as it supports the country’s efforts to counter money laundering and combat terrorist financing at the global level. These measures enhance its position across relevant global indicators and contributes to strengthening global confidence in the UAE economy. She also highlighted the Ministry’s keenness to intensify communication with DNFBPs during the coming period and follow-up on the sector's implementation of the due diligence measures following their registration in the systems approved for this matter.

The MoE provides, through its official website, all information and instructions for registration, through the following links:

Link to the registration steps in the Automatic Reporting System for Sanctions Lists:
https://www.economy.gov.ae/English/aml/pages/circulars-notices.aspx

Link to the measures required of companies according to the executive regulations:
https://www.economy.gov.ae/English/aml/pages/default.aspx

Link to the guides provided by the Ministry on the requirements for combating money laundering:
https://www.economy.gov.ae/English/aml/pages/guides.aspx

She further explained that the Ministry of Economy is uploading all the workshops on anti-money laundering and combating terrorism financing onto its official YouTube channel to enable all DNFBP companies, stakeholders and interested parties to view their content, on the link: https://www.youtube.com/channel/UChqcRa_X-2nIOSzrZ8rNZVw

The Ministry of Economy called on all targeted establishments to contact it through the Ministry's call center at 8001222 or via other official channels in case there are any inquiries related to registering in the two systems and fulfilling the required measures.