UAE renews anti-money laundering vow amid growing payments sector

The guidance, which comes to effect immediately, “will assist LFIs’ understanding of risks and effective implementation of their statutory AML/CFT obligations, and takes Financial Action Task Force (FATF) standards into account,” WAM said in a statement, adding LFIs must comply with the regulator within a month.

The Central Bank has levied a fine on several financial institutions and banks for not complying with the nation’s AML rules over the last few months.

The guidance is set in place to enable LFIs to mitigate risks that would arise from money laundering and the financing of terrorism risks related to payments.

“We are committed to implementing high regulatory control over LFIs and their payment operations, including products, services and exposure,” CBUAE’s governor Khalid Mohammed Balama said.

New payment products and services might bring risks to the financial system because of the rapid movement of funds between payment participants and across borders and LFIs might be exposed to participants licensed by the CBUAE and those operating globally, the regulator said.

LFIs must conduct a regular risk assessment to cover all the payment products, services, relationships and exposure to domestic and foreign payment sector participants.

Suspicious transactions must be reported to the UAE’s financial intelligence unit, the regulator added.

Financial institutions must have a sanctions compliance programme with operational systems that screen transactions and transmit required information throughout the payment cycle.

LFIs must also avoid processing payments for a correspondent unless they are sure that the correspondent conducts proper screening.

These preventive measures should be integrated into the “LFI’s AML/CFT compliance programme and supported with governance and training,” the statement said.