The UAE Central Bank has passed several regulations to ensure strict adherence to AML/CFT guidelines by financial institutions in the country. Photo: UAE Central Bank
The UAE Central Bank has passed several regulations to ensure strict adherence to AML/CFT guidelines by financial institutions in the country. Photo: UAE Central Bank
The UAE Central Bank has passed several regulations to ensure strict adherence to AML/CFT guidelines by financial institutions in the country. Photo: UAE Central Bank
The UAE Central Bank has passed several regulations to ensure strict adherence to AML/CFT guidelines by financial institutions in the country. Photo: UAE Central Bank

Business

Banking

UAE begins hosting Egmont Plenary as part of efforts to curb financial crimes

Event will discuss how financial intelligence units can use technology to prevent money laundering

Aarti Nagraj
Aarti Nagraj

July 04, 2023

  • English
  • Arabic

The annual Egmont Group Plenary has started in Abu Dhabi this week to support global efforts to curb money laundering and financial crimes.

The event, which has more than 500 participants this year, is being hosted by the UAE Financial Intelligence Unit.

It is focussing on how advanced IT technologies can be used by global financial intelligence units to enhance their operations.

"The UAE’s hosting of the EG Plenary is in line with country’s robust efforts to protect the UAE and wider global financial system from money laundering, the financing of terrorism and financial crimes," the UAE Central Bank said in a statement on Tuesday.

"It strives do so by bolstering co-operation with international counterparts, enhancing the exchange of information and expertise with competent authorities."

The UAE has passed strict laws to prevent money laundering and the financing of terrorism, and has issued a number of regulations over the years to clamp down on financial crime.

The country issued fines of more than Dh115 million ($31.3 million) in the first quarter of the year to combat money laundering, state news agency Wam reported in April.

The 161 fines were handed out to 76 entities in the first three months.

Confiscations have also increased, with frozen assets worth more than Dh925 million seized from November 2022 to February 2023.

Hamid Al Zaabi, director general of the Executive Office for Anti-Money Laundering and Countering the Financing of Terrorism, told Wam in April that the organisation was working closely with the Financial Action Task Force.

He said the UAE was an important trade and investment hub and the federal government was working closely with authorities and the private sector to ensure they were using effective measures against money laundering and financing terrorism.

Meanwhile, the UAE Central Bank has passed several regulations to ensure financial institutions adhere to money laundering and financing terrorism guidelines.

The Egmont Group, which has 166 members from across the world, seeks to enhance communication and collaboration between financial intelligence units, with its members receiving thousands of reports of suspicious transactions annually.

Financial intelligence units are "instrumental in ensuring that financial systems remain sound", and the annual event seeks to facilitate enhanced co-operation and exchange of information between Egmont Group members, the statement said.

The event in the UAE will host discussions around topics including the use of privacy-enhancing technologies, using artificial intelligence for effective collaboration, best practice in financial information exchanges and training programme development.

Members will also discuss Egmont Group's reports and policies and produce "actionable financial intelligence for the fight against money laundering".

UAE v Gibraltar

What: International friendly

When: 7pm kick off

Where: Rugby Park, Dubai Sports City

Admission: Free

Online: The match will be broadcast live on Dubai Exiles’ Facebook page

UAE squad: Lucas Waddington (Dubai Exiles), Gio Fourie (Exiles), Craig Nutt (Abu Dhabi Harlequins), Phil Brady (Harlequins), Daniel Perry (Dubai Hurricanes), Esekaia Dranibota (Harlequins), Matt Mills (Exiles), Jaen Botes (Exiles), Kristian Stinson (Exiles), Murray Reason (Abu Dhabi Saracens), Dave Knight (Hurricanes), Ross Samson (Jebel Ali Dragons), DuRandt Gerber (Exiles), Saki Naisau (Dragons), Andrew Powell (Hurricanes), Emosi Vacanau (Harlequins), Niko Volavola (Dragons), Matt Richards (Dragons), Luke Stevenson (Harlequins), Josh Ives (Dubai Sports City Eagles), Sean Stevens (Saracens), Thinus Steyn (Exiles)

Ads on social media can 'normalise' drugs

A UK report on youth social media habits commissioned by advocacy group Volteface found a quarter of young people were exposed to illegal drug dealers on social media.

The poll of 2,006 people aged 16-24 assessed their exposure to drug dealers online in a nationally representative survey.

Of those admitting to seeing drugs for sale online, 56 per cent saw them advertised on Snapchat, 55 per cent on Instagram and 47 per cent on Facebook.

Cannabis was the drug most pushed by online dealers, with 63 per cent of survey respondents claiming to have seen adverts on social media for the drug, followed by cocaine (26 per cent) and MDMA/ecstasy, with 24 per cent of people.

Mercer, the investment consulting arm of US services company Marsh & McLennan, expects its wealth division to at least double its assets under management (AUM) in the Middle East as wealth in the region continues to grow despite economic headwinds, a company official said.

Mercer Wealth, which globally has $160 billion in AUM, plans to boost its AUM in the region to $2-$3bn in the next 2-3 years from the present $1bn, said Yasir AbuShaban, a Dubai-based principal with Mercer Wealth.

“Within the next two to three years, we are looking at reaching $2 to $3 billion as a conservative estimate and we do see an opportunity to do so,” said Mr AbuShaban.

Mercer does not directly make investments, but allocates clients’ money they have discretion to, to professional asset managers. They also provide advice to clients.

“We have buying power. We can negotiate on their (client’s) behalf with asset managers to provide them lower fees than they otherwise would have to get on their own,” he added.

Mercer Wealth’s clients include sovereign wealth funds, family offices, and insurance companies among others.

From its office in Dubai, Mercer also looks after Africa, India and Turkey, where they also see opportunity for growth.

Wealth creation in Middle East and Africa (MEA) grew 8.5 per cent to $8.1 trillion last year from $7.5tn in 2015, higher than last year’s global average of 6 per cent and the second-highest growth in a region after Asia-Pacific which grew 9.9 per cent, according to consultancy Boston Consulting Group (BCG). In the region, where wealth grew just 1.9 per cent in 2015 compared with 2014, a pickup in oil prices has helped in wealth generation.

BCG is forecasting MEA wealth will rise to $12tn by 2021, growing at an annual average of 8 per cent.

Drivers of wealth generation in the region will be split evenly between new wealth creation and growth of performance of existing assets, according to BCG.

Another general trend in the region is clients’ looking for a comprehensive approach to investing, according to Mr AbuShaban.

“Institutional investors or some of the families are seeing a slowdown in the available capital they have to invest and in that sense they are looking at optimizing the way they manage their portfolios and making sure they are not investing haphazardly and different parts of their investment are working together,” said Mr AbuShaban.

Some clients also have a higher appetite for risk, given the low interest-rate environment that does not provide enough yield for some institutional investors. These clients are keen to invest in illiquid assets, such as private equity and infrastructure.

“What we have seen is a desire for higher returns in what has been a low-return environment specifically in various fixed income or bonds,” he said.

“In this environment, we have seen a de facto increase in the risk that clients are taking in things like illiquid investments, private equity investments, infrastructure and private debt, those kind of investments were higher illiquidity results in incrementally higher returns.”

The Abu Dhabi Investment Authority, one of the largest sovereign wealth funds, said in its 2016 report that has gradually increased its exposure in direct private equity and private credit transactions, mainly in Asian markets and especially in China and India. The authority’s private equity department focused on structured equities owing to “their defensive characteristics.”

The Perfect Couple

Starring: Nicole Kidman, Liev Schreiber, Jack Reynor

Creator: Jenna Lamia

Rating: 3/5

Updated: July 04, 2023, 10:06 AM
UAE