UAE making 'step change' in fight against financial crime, says Sheikh Abdullah bin Zayed

In article for 'Forbes Middle East', minister outlines country's five principles to tackle money laundering and terrorist financing

Sheikh Abdullah bin Zayed, Minister of Foreign Affairs and International Co-operation says illicit finance poses a threat to "the integrity of the UAE's world-leading financial sector". Image: Wam

Sheikh Abdullah bin Zayed, Minister of Foreign Affairs and International Co-operation said the UAE is making "strong progress" in its efforts to prevent illicit financial flows and realise the goal of making the Emirates "one of the strongest and most respected economies in the world".

He said the UAE economy, like all global financial centres, must combat "the threat of organised crime, fraud, money laundering and corruption".

"This is a growing issue for all major economies, and it’s one we in the UAE take extremely seriously," he said, writing in Forbes Middle East on Tuesday.

By continuing with our disciplined approach, we will enact a true step change in our ability to prevent illicit financial flows and realise our goal of making the UAE one of the strongest and most respected economies in the modern world

Sheikh Abdullah bin Zayed

Sheikh Abdullah wrote the UAE's approach "will enact a true step change in our ability to prevent illicit financial flows".

The UN estimates that between $800 billion and $2 trillion is laundered globally annually - around 2-5 per cent of global GDP.

While the UAE represents a tiny proportion of this huge global sum, Sheikh Abdullah said "illicit finance poses a threat to the UAE’s international reputation and to the integrity of our world-leading financial sector".

The growth of technology and the spread of globalisation have been beneificial to economies like the UAE, but they have also presented opportunities for criminals around the world.

"Our interconnected, modern global financial system needs to be protected," said Sheikh Abdullah.

"That is why I lead the Higher Committee Overseeing the National Strategy on anti-money laundering and counter-terrorist financing. Our objective is simple: to increase the UAE’s effectiveness at combating financial crime."

Anwar Gargash, the Diplomatic Advisor to the President Sheikh Khalifa, wrote on Twitter that Sheikh Abdullah's article describes a "qualitative change in the UAE's response to financial crimes".

In his article, Sheikh Abdullah set out five principles to tackle the issue.

The first is to "recognise the scale and complexity of the situation requires active partnership between government and industry".

He said divisions will be removed that will be make it easier to share knowledge across financial institutions, regulators and law enforcement agencies.

The second principle is that "we have a common goal across the economy of preventing, detecting and deterring illicit activity in the financial system".

"For example, government intelligence can often provide unique information on specific illicit actors, or trends across financial institutions and sectors, but without the specific transaction details," he said.

"Financial institutions can see payment flows within their firms but lack detailed information on illicit actors or trends across other financial institutions. Working more coherently together benefits all involved. And that is exactly what we are doing."

Thirdly, the UAE is using advanced analytics, technology, investigation and public-private partnership to sharpen its collective defences.

"This is enabling our experts to join dots in real time, applying their judgement quickly to complex themes and fast emerging patterns," Sheikh Abdullah said.

Fourth, the UAE is working closely and collaboratively with international partners.

"In September 2021, UAE Minister of State Ahmed Al Sayegh signed a first of its kind partnership to tackle illicit financial flows with UK Home Secretary Priti Patel. Enhanced intelligence sharing and joint operations are already delivering notable successes," he said.

The fifth principle is to continue to conduct economy-wide risk assessments on money laundering and terrorist financing.

"Alongside this, we are significantly investing in the UAE’s financial crime capabilities," he said.

"Sectors at higher risk of financial abuse, such as gold trading and real estate, have been comprehensively moved onto the federally-managed anti money laundering reporting system since May last year."

He said financial institutions, accountants, auditors, dealers in precious metals and stones and property brokers are all now each required to monitor and report suspicious transactions.

In addition, special money laundering courts have been established in Abu Dhabi and Dubai, tightening the enforcement regime within the UAE’s largest business and trade centres. The good news is we are already making strong progress

Sheikh Abdullah bin Zayed

Law enforcement also has access to a comprehensive database of beneficial ownership on UAE entities.

Sheikh Abdullah said the UAE Financial Intelligence Unit, which assesses suspicious activity reports with a view to launching investigations, has doubled staffing levels. From 2019 to 2021, money laundering cases secured a 94 per cent conviction rate in 243 instances.

"The UAE Central Bank, the Ministry of Justice, and the Ministry of Economy have each been active in announcing renewed guidance on anti-money laundering and counter-terrorist financing," he said.

"In addition, special money laundering courts have been established in Abu Dhabi and Dubai, tightening the enforcement regime within the UAE’s largest business and trade centres. The good news is we are already making strong progress."