The Dubai Financial Services Authority has imposed a Dh401,000 ($109,200) fine on wealth management services firm Vault Wealth for conducting transactions without authorisation.
Vault Wealth, which provides financial services such as advising on investments or credit and arranging deals, is incorporated at Abu Dhabi's ADGM and is licensed by its Financial Services Regulatory Authority.
However, it has never been authorised by the DFSA to provide financial services in or from Dubai International Financial Centre, the DFSA said in a statement on Thursday.
The fine stems from a period in which Vault Wealth employees worked from the offices of a related DIFC entity, Vault Technology, which was not regulated by the DFSA, between February and May 2024.
At that time, prospective clients were invited to the DIFC office, where Vault Wealth provided financial advice and assisted clients with onboarding on to an investment platform, the DFSA said. The clients were also provided with know-your-customer documentation for the purpose of arranging the creation of investment accounts.
“Authorisation by another regulator does not permit a firm to conduct financial services in or from DIFC … firms must ensure that they have the appropriate DFSA authorisation before undertaking regulated activity here,” said Alan Linning, managing director for enforcement at the DFSA.
The penalty was reduced by 30 per cent from Dh573,000 after Vault Wealth agreed to a settlement, it said.
Proper authorisation to conduct financial transactions is “fundamental to the integrity of DIFC’s regulatory framework and to the protection of those who use, or may use, financial services within the centre”, Mr Linning added.
Authorities in the UAE have been vigilant on cracking down on entities that breach regulations as part of efforts to maintain the financial system's integrity and reliability.
The UAE Central Bank, for instance, has imposed fines on lenders that have violated rules, especially those on anti-money laundering.
“The action taken by the DFSA demonstrates that we will intervene where firms operate outside the regulatory perimeter and will impose sanctions that reflect the seriousness of such conduct and deter others from doing the same,” Mr Linning said.
At the height of the war in Iran, DIFC and DFSA unveiled economic stimulus measures aimed helping their companies cope with the effects of the regional conflict, designed to “ease short-term operational and financial pressures”.
