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The Central Bank of the UAE (CBUAE) has issued a new guidance on anti-money laundering and combatting the financing of terrorism (AML/CFT) for its licensed financial institutions (LFIs) which provide services to cash-intensive businesses (CIBs).
The guidance came into effect on 28 September and LFIs are required to comply with them within one month, the monetary authority said in a statement on Sunday.
The central bank defined CIBs as businesses that experience a high volume of cash flows. Some aspects of these businesses, such as the involvement of cash couriers, cash deposits, currency exchanges and cross-border movement of cash, may be vulnerable to money laundering or the financing of terrorism and illegal organisations, the regulator said.
Therefore, LFIs providing services to CIBs must assess all CIB customers to determine their degree of risk. LFIs must perform due diligence related to identification of customers, understanding of their business, and monitor the business relationship.
LFIs should enquire into the customers' source of cash deposited as well as mandate the use of Emirates ID for cash deposits in automated teller machines (ATMs).
They should monitor transactions and report any that appear unusual and potentially suspicious, the central bank said.
The UAE has in recent months beefed up regulations targeted at banks and financial institutions to combat and prevent money laundering. Earlier this year, the government set up an Executive Office for Anti-Money Laundering and Counter Terrorism Financing. In August, Dubai set up a specialist court to hear cases relating to money laundering and financial crime.
(Writing by Brinda Darasha; editing by Seban Scaria)
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