An analysis of the determinants of money laundering in the United Arab Emirates (UAE)
| Date | 24 October 2023 |
| Pages | 858-872 |
| DOI | https://doi.org/10.1108/JMLC-09-2023-0150 |
| Published date | 24 October 2023 |
| Author | Mariam Aljassmi,Awadh Ahmed Mohammed Gamal,Norasibah Abdul Jalil,K. Kuperan Viswanathan |
An analysis of the determinants of
money laundering in the United
Arab Emirates (UAE)
Mariam Aljassmi,Awadh Ahmed Mohammed Gamal and
Norasibah Abdul Jalil
Department of Economics, Faculty of Management and Economics,
Sultan Idris Education University, Tanjong Malim, Malaysia, and
K. Kuperan Viswanathan
Haas School of Business, University of California Berkeley,
Berkeley, California, USA
Abstract
Purpose –It is widely argued that money laundering(ML) is not a new phenomenon and the pervasiveness
of ML is associated with some severe economic, social and politicalcosts. Due to the lack of studies on the
ML’s issue in the UAE, thisstudy aims to examine the determinants of ML in the countrybetween 1975 and
2020.
Design/methodology/approach –The autoregressive distributed lag bounds testing results
demonstrate the presence of long-run relationship between ML and the selected macroeconomics variables.
The analysis is validated by the dynamic ordinary least squares, the fully modified ordinary least squares
and the canonicalco-integration regression estimators.
Findings –The estimation result reveals that while the real estate market, outflow of money, arms
procurementand size of the underground economy influencesthe size of ML positively, gold trade, the level of
financial developmentand the size of economic activities are negativelyassociated with ML, both in the short-
and long-run.
Originality/value –Up to date from a country-level analysis, no study has been devoted to the ML in
UAE, except for Aljassmi et al. (2023). To the best of the authors’knowledge, this study is the first to
investigate the determinantsof laundered money in the UAE economy. Based on these outcomes, strategies
and measures which will deter the laundering of illicit funds through the real estate and gold market,
remittancesystem, financial system and arms procurement contractsinthe UAE are recommended.
Keywords Money laundering, Real estate market, Outflow of money, Underground economy,
Gold trade, UAE
Paper type Research paper
1. Introduction
Money laundering (ML) is not a new phenomenon. It is generallyregarded as the process of
moving, disguising and integratingthe proceeds of illicit activities (including drug and
human trafficking, grand corruption, tax evasion, illegal arms deal and kidnapping,
amongst others) into the mainstream economy to obscure its link with the actors and
JEL classification –C22, E41, K42
The authors acknowledge the Sultan Idris Education University (UPSI), Malaysia for supporting this
research. Any error remains the authors’responsibility.
JMLC
27,5
858
Journalof Money Laundering
Control
Vol.27 No. 5, 2024
pp. 858-872
© Emerald Publishing Limited
1368-5201
DOI 10.1108/JMLC-09-2023-0150
The current issue and full text archive of this journal is available on Emerald Insight at:
https://www.emerald.com/insight/1368-5201.htm
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