Presenting a legal and regulatory analysis of the United Arab Emirates’ past, present and future legislation on combating money laundering (ML) and terrorist financing (TF)
| DOI | https://doi.org/10.1108/JMLC-08-2017-0038 |
| Published date | 27 January 2020 |
| Date | 27 January 2020 |
| Pages | 253-267 |
| Subject Matter | Accounting & Finance,Financial risk/company failure,Financial compliance/regulation,Financial crime |
| Author | Mohammed Ahmad Naheem |
Presenting a legal and regulatory
analysis of the United Arab
Emirates’past, present and future
legislation on combating money
laundering (ML) and terrorist
financing (TF)
Mohammed Ahmad Naheem
Mayfair Compliance, Frankfurt, Germany
Abstract
Purpose –This paper aims to study the three levels of anti-money laundering (AML) and combating of
terrorist financing (CTF) regulationsthat apply to banks and financial institutions listed within the country.
The paper aims to determinerisks arising from globalised financial centreswithin the United Arab Emirates
(UAE) and potential improvements deficiencies that may otherwise serve as conduits for criminal and
terrorist organisations. There is a significant body of literature that covers the advance of AML/CTF
legislation in the Dubai-based free trade zone,the Dubai International Financial Centre (DIFC). Though free
trade zones are scatteredacross the UAE, the DIFC has the highest foreign investment in the country with an
expandedinternational network.
Design/methodology/approach –The UAE has made progress as part of its fight against money
laundering (ML) and terrorist financing (TF). This paper studies the legislative stance by analysing the
country’s AML/CTF laws. Also, the advancesof global financial centres in the UAE have created layers of
regulation, each regulator withtheir own set of rules. This paper attempts to study the regulationsand the
level of theirenforcement to combat ML and TF.
Findings –This paper finds significant regulatory oversight in certain frameworks set within the UAE’s
financial system. However, the paper finds secondaryliterature and evaluations conducted by international
bodies that suggest some deficiencies within the mechanisms, that are being resolved by the country’s
regulatory agencies. The UAE’s advancing network of financial institutions has created a global chain of
monetary transfers,which offers some possibility of ML also extending to TF. Though the country has made
progress,there remain a few flaws that can be exploited by criminal and terrorist organisations.
Practical implications –ML has the possibility to damage marketsif allowed in excess. This is not the
case with the UAE, and large unverifiedtransactions are investigated by the regular authorities.ML is now a
matter of concernwhen funds acquired through illegalmeans may be used to directly finance terrorism.
Originality/value –This paper tests the UAE’s mechanismsto combat ML and TF in the context of the
country’s advancing of a global central financialmarket. There is a need to understand these regulations as
Please note that this paper was composed and submitted for review to this journal in August 2017 –
All the content was current at that point in time (Aug ’17). The banking and regulation industries
alongside governmental policy-making have evolved greatly since Aug 2017, with new material from
academic research emerging. These points need to be taken into consideration when reading this
paper.
The author explicitly states that this research article is not a propaganda piece and in no way has
the author received any form of funding or assistance from any party towards this piece of research.
This paper sets out an approach to extend the discussion on the Gulf region from an independent
academic perspective, employing tools that separate AML/CTF analysis from media opinion.
Combating
money
laundering
253
Journalof Money Laundering
Control
Vol.26 No. 2, 2023
pp. 253-267
© Emerald Publishing Limited
1368-5201
DOI 10.1108/JMLC-08-2017-0038
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