Table of Contents
ToggleUnderstanding AML Registration
Anti-Money Laundering (AML) is vital for maintaining the integrity of financial systems. Enforced by governments, AML Registration laws ensure compliance with international standards. Since 2018, authorities have worked to establish an effective legal framework that combats money laundering and criminal organization financing. These efforts also aim at Countering the Financing of Terrorism.
The UAE’s national structure for AML focuses on key interventions to address high risks in various regions. This includes a national risk assessment carried out with broad participation from relevant authorities. The findings revealed the need for a robust institutional framework to enforce legal requirements and tackle terrorist funding. By following FATF guidelines and ensuring compliance, nations can strengthen their defenses.
How AML Registration Protects You
AML registration serves as a cornerstone for fighting financial crimes. The Financial Action Task Force (FATF) conducted a review in 2019, highlighting areas to enhance anti-money laundering efforts. By implementing procedures with precision and efficacy, businesses can meet legal and regulatory demands while contributing to a safer economy.
Efforts to tackle money laundering are ongoing, and entities are urged to remain vigilant. A well-established legal framework not only aids compliance but also empowers businesses to contribute to global financial security. By aligning with the latest policies, organizations can mitigate risks and support efforts to fight terrorism effectively.
Building a Strong Institutional Framework for AML/CFT
In the UAE, efforts to build a robust framework for AML/CFT legislation are a top priority. Under the leadership of His Highness Sheikh Abdullah bin Zayed Al Nahyan, who also serves as the Minister of Foreign Affairs and International Cooperation, the Higher Committee Overseeing National Strategy on Anti-Money Laundering and Countering the Financing of Terrorism plays a pivotal role. This strategy includes 12 national strategic goals spanning 2020-to-2023, aimed at tackling terrorist financing and strengthening the country’s strategies to tackle money laundering.
The Governor of the Central Bank heads the NAMLCFTC, established in 2000, which oversees the nation’s progress in combating financial crimes. These collective efforts have been instrumental in creating a framework that aligns with global standards, ensuring the UAE remains at the forefront of fighting financial crime and protecting its economy.
Yearly AML/CTF Risk Evaluation Report
Compliance Through Risk Evaluation
Under Cabinet Decision No. (10) of 2019, all DNFBPs and Designated Non-Financial Businesses must file the annual AML/CTF risk assessment report to the Ministry of Economy (MoE). This ensures their business activities align with AML laws and regulations. The report contains internal information and external information to evaluate compliance and assign a risk score. Non-compliance or providing wrong information could lead to being penalized. This is crucial for Countering Money Laundering, Terrorism Financing, and Combatting Illegal Organizations.
The Supervisory Authority uses a risk-based approach to review the data. Introduced by Article 44.4 1 of Decree-Law No. (20) of 2018, this process supports Professionals and authorities in maintaining transparency. Filing these reports annually allows the Ministry of Economy to track efforts effectively. Businesses must ensure accuracy, as a lack of compliance can jeopardize operations and lead to legal consequences.
Inherent Risk
This section primarily includes:
- Legal details
- Operational Activities
- Ultimate Beneficiary information
- Client records
- Nature of Transactions conducted during the year
Risk Mitigation Control and Quality Assurance
Implementing AML-CTF controls ensures that financial risks are effectively managed. By keeping client records maintained and documented, organizations can track activity and stay compliant. Risks assessed and risks detected are promptly mitigated through appropriate policies and well-structured procedures. This systematic approach helps tackle problems before they escalate.
- Maintain client records for compliance.
- Document risks for transparency.
- Use appropriate policies to mitigate risks.
- Implement strong AML-CTF controls for safety.
Authorized Parties
Regulated reporting entities in the UAE must follow yearly obligations to maintain a strong compliance system. Every person responsible for preparing and submitting reports must ensure that they are properly reviewed and include accurate details. To meet standards, entities must develop and implement robust measures and proper controls to address risks and maintain transparency effectively.
2021 AML/CTF Risk Report Filing Deadline
Category | Submission Deadline | Additional Information |
Auditors and Accountants | 07 September 2021, 00:09 UAE time | Filing notifications sent to your registered email. |
Real Estate Brokers | 23 August 2021 at 11:59 pm | Filing notifications sent to your registered email. |
Dealers of Precious Metals and Stones | 16 August 2021 | Filing notifications sent to your registered email. |
All goAML Registered Entities | N/A | Filing notification and details provided via registered email. |
Registration Process for the goAML System
The Ministry of Economy (MoE) in the UAE has mandated that all Designated Non-Financial Business and Professions (DNFBPs) must register with the goAML system. This requirement aims to help combat money laundering crimes and the funding of terrorism in compliance with Federal Law No 20 of 2018. Entities are also encouraged to align with the Automatic Reporting System for Sanctions Lists and follow strict regulations to ensure full compliance.
The registration process includes submitting information to the Financial Intelligent Unit by the specified deadlines, such as April 30, 2021, although late registrations are accepted. Non-compliance could lead to administrative fines ranging from AED 50,000 to 1,000,000. The Committee on Goods Subject to Import and Export Control oversees these efforts, supported by targeted awareness campaigns and monitoring campaigns. Adhering to these decision-making rules ensures entities avoid penalties and remain compliant with AML laws.
What Does the goAML System Do?
The goAML system is an integrated digital platform that helps financial institutions and designated non-financial businesses report Suspicious Transaction Reports (STRs) and Suspicious Activity Reports (SARs). It allows the Financial Intelligence Unit to collect, evaluate, and distribute suspicious transaction information to the relevant authorities. The system processes data rapidly and effectively, ensuring compliance across all occupations that require AML oversight.
What is the Committee for Import and Export Control and Sanctions Reporting?
The Committee for Import and Export Control ensures compliance with targeted financial sanctions by monitoring the UN list and local list. Through an advanced system, authorities provide timely updates when individuals are added or removed. Registered establishments like financial institutions and designated non-financial undertakings receive e-mail notifications to stay informed. This process supports various professions in maintaining compliance and ensures that all entities complete their registering requirements effectively.
Which Businesses Qualify as Designated Non-Financial Businesses and Professions (DNFBPs)?
AML Registration is a crucial step for businesses and professionals to comply with anti-money laundering regulations and prevent money laundering threats. Entities like real estate agents, brokers, and precious stone dealers must register and monitor financial transactions involving single cash transactions or multiple transactions exceeding AED 55,000. This process ensures transparency in trade, the creation or establishment of legal persons, and the management of commercial entities and legal arrangements.
Key Measures for Compliance
To adhere to AML regulations, the Ministry of Economy has outlined three key measures:
- Facility Compliance Officer: Appoint an officer responsible for registration, follow-up, and ensuring adherence to implementing regulations.
- Due Diligence: Verify the identity of the client, beneficial owner, and maintain accurate business activities records.
- Reporting Systems: Register in the goAML system and the Automatic Reporting System For Sanctions Lists, submitting suspicious transaction reports when necessary.
Roles and Responsibilities
Providers of corporate services, independent accountants, and independent legal practitioners play vital roles in managing legal persons, trusts, and direct trusts. These professionals handle financial transactions, oversee bank accounts, securities accounts, and ensure the management of funds aligns with federal laws. Compliance includes maintaining a registered office, administrative address, or correspondence address for clients and adhering to the decision of the Minister.
Penalties and Inspection
The Committee for Commodities Subject to Import and Export Control monitors target establishments through field inspection campaigns. Non-compliance with AML laws can lead to punishments, including hefty fines. Businesses must avoid violations, exercise due diligence, and align their commercial operations with ongoing requirements. Awareness campaigns aim to educate entities about federal law requirements and the importance of maintaining compliance to mitigate risks effectively.
Summary of Responsibilities
- Maintain residence, work address, and business compliance records.
- Equip a partner, secretary, or director for compliance tasks.
- Monitor commercial operations and prevent misuse by a nominal shareholder or agent.
This holistic approach ensures businesses fulfill their obligations and uphold integrity in their operations.
UAE Central Bank Releases New AML/CTF Guidelines
The UAE Central Bank has issued updated guidance effective from 1st of August-2022. These measures align with FATF standards to help LFIs understand and mitigate risks associated with money laundering and counter-terrorism financing. By adhering to this guidance, institutions can fulfill their statutory obligations while ensuring secure payments and financial transactions.
Key Preventive Measures
To combat financing of terrorism and strengthen Anti-Money Laundering practices, the guidelines outline key preventive measures, including:
- Identifying and addressing potential risks proactively.
- Enhancing systems to mitigate vulnerabilities in financial processes.
- Following best practices from the Financial Action Task Force for compliance.
These steps enable organizations to maintain transparency and safeguard financial integrity.
Key Elements of AML Registration
AML Registration is essential for managing financial risks and ensuring compliance with anti-money laundering standards. Businesses and LFIs must adopt a Risk-based Approach to identify and mitigate potential threats in their domestic payment sector and foreign payment sector. Below are the critical measures:
- Conduct Regular Risk Assessments for all payment products, services, and transactions.
- Implement a sanctions compliance program to monitor and screen transactions effectively.
- Ensure appropriate screening of customers and participants in correspondent relationships.
- Use operational systems to track, monitor, and report suspicious transactions.
- Work closely with the UAE Financial Intelligence Unit to transmit required information in the payment cycle.
- Be entirely confident that partners in relationships maintain compliance standards.
These steps help protect financial institutions from exposure and maintain the integrity of the payment systems.
“Ensure Preventive Measures Align with LFI’s AML/CFT Compliance Program, Governance, and Training”
How We Can Assist You?
Our team helps with registration in the goAML system and the Automatic Reporting System for Sanctions Lists. We assist Brokers and Real Estate Agents, Dealers in Precious Metals and Precious Stones, Auditors, and Corporate Service Providers in complying with anti-money laundering programs. Working alongside the Ministry of Economy (MOE) and AMCA, we ensure you meet the standards across all four classifications, making compliance simple and efficient.