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UAE Government tightened grip on economic offenders

UAE Government tightened grip on economic offenders

In the last couple of decades, UAE emerged as a cosmopolitan hub offering wide range of investment opportunities. However, with the increase in business transactions, the financial crimes such as Money laundering or terrorism have also raised at an alarming rate. Recently, UAE government has come up with a national strategy to combat such crimes with the help of competent government agencies such as public prosecution, police agencies, Central Bank, Customs, Financial Information Unit and the Executive Office.

The law enforcement agencies have been assigned with the power of track and seize funds and monitor suspicious bank accounts. The criminal court have been authorised to confiscate the proceeds of such crimes and impose penalties on the offenders. The power given to the courts are in addition to the present legislation in force. The coordinated efforts of the specialised agencies are strongly committed to achieve the standards of International Financial Action Task Force (FATF). Dubai Economic Security Centre is established with a sole objective to protect the interest of vulnerable investors from the increasing hazard of financial crimes.

Guidelines of UAE Central Bank
The UAE Central Bank has come out with new guidelines relating to anti-money laundering with a special emphasis on the entities working in the real estate, precious metals and stones sectors. The entities belonging to the said sectors need to appoint a compliance officer and develop effective programs. As per the guidelines, the financial institutions are obliged to conduct high level of due diligence before sanctioning any loan or disbursement of funds.  If they came across any suspicious activity, they are bound to report it to the UAE’s Financial Intelligence Unit by filing a suspicious activity report.

Stringent Punishment for the offenders
Recently, it has been observed that a very harsh and stringent approach has been adopted by the government agencies as a deterrence against these crimes. A former employee of a Dubai bank has been sentenced an imprisonment of 5 years along with deportation by the criminal court for indulgence in embezzlement of funds amounting to AED 5.23 million.

In another ruling, Dubai Criminal court imposed a fine of AED 100,000 on a person against the charge of concealment of illegal funds. The person was an expatriate and entered the country through Dubai International Airport. It is interesting to note that the amount of fine was the maximum amount which can be charged by a court as per Federal Law. No. (20) of 2018 issued by the UAE Central Bank. This clearly demonstrates that there is no scope of relaxation and the offender had to bear the burnt of hefty fines along with penal punishments.

In Short
The recent steps taken by the UAE government highlights its unfettered commitment to ensure that UAE emerges as one of the safest investment destinations with a minimal crime rate. All the financial activities shall be carried out under strict legal scrutiny. The role of specialised agencies has been increased to investigate, penalise and frame new policies relating to all the financial crimes.

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