New CBUAE Guidance For Licensed Financial Institutions – Money Laundering & More Latest News Here – Up Jobs

Over the past two years, the UAE Central Bank
(“CBUAE“) has been actively working on
issuing updated circulars to address the growing concerns and
challenges relating to money laundering, financing of terrorism and
sanctions. This is part of the overall approach the CBUAE is
adopting as part of their ongoing efforts to protect the integrity
of the financial system and reconfirm their commitment to comply
with Financial Action Task Force
(“FATF“) recommendations.

The CBUAE regularly publishes regulations and standards for the
banking sector that encompass numerous key areas, including
anti-money laundering and transaction monitoring. At the time of
writing, the most recently published guidance was issued on 02
August 2022 for the licensed financial institutions
(“LFIs“) on payments risks.

The following article looks at the most noteworthy points from
the new guidance.

The aim of the new guidelines is to help LFIs address money
laundering, terrorism financing and sanctions risks, assisting in
understanding the related risks, and in implementing the necessary
and preventive measures to mitigate those risks. It also takes FATF
standards into account.

Due to the rapid movement of funds between payment participants
and across borders, LFIs should take a risk-based approach to
mitigate and manage money laundering and the terrorism financing
risks. LFIs are required to conduct due diligence on customers and
regular risk assessments to cover all transactions, reporting any
suspicious transaction to the UAE’s Financial Intelligence Unit
using the “goAML” portal.

In correspondent relationships, financial institutions should
not process any payments for a correspondent unless they are
entirely confident that the correspondent conducts appropriate
screening.

The new guidance will ensure that all LFIs in the UAE understand
their Anti-Money Laundering (“AML“)
responsibilities and have a sanctions compliance program that will
screen the transactions and assist with mitigating the related
risks.

The UAE has reiterated its strong commitment and the ongoing
effort that has been put into strengthening its regulatory
framework in relation to AML and Combating the Financing of
Terrorism (“CFT“), by taking effective
measures to remedy several areas of improvement through the
implementation of a high regulatory control system and spreading
awareness.

The guidance also provides LFIs a timeline of one month to
comply with the new requirements.

This guidance is one out of many regulations and policies issued
by the CBUAE, which seeks to address the challenge of money
laundering and terrorist financing as a strategic priority and to
stress on the importance that LFIs understand their AML
responsibilities and comply with its requirements.

The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.