United Arab Emirates creates a database to combat money laundering

The United Arab Emirates has made progress in its domestic efforts to combat money laundering and terrorist financing
Emiratos Árabes Unidos  PHOTO/WAM

PHOTO/WAM  -   The United Arab Emirates

The United Arab Emirates has created a database of beneficial owners of companies and other entities that may be channelling illicit funds, in a further move by the Gulf state that, as a centre of luxury business and commerce, has attracted money of questionable provenance.

According to an Emirati Government statement, the database will serve as a reference for law enforcement agencies and other bodies investigating financial crimes and will enhance international cooperation in tackling money laundering and terrorist financing.  

The database will also serve to strengthen international cooperation by facilitating requests from other countries to exchange information to combat money laundering and terrorist financing.

A beneficial owner is a person who owns or controls a company directly or indirectly by holding more than 25% of the ownership rights of the company and 25% or more of the voting power of the company, while retaining the ability to hire or fire a majority of the members of the board of directors.

Last February, the Emirati Government approved the establishment of the Executive Office for Anti-Money Laundering and Combating the Financing of Terrorism (AML/CFT), which supervises the implementation of national reform programmes designed to strengthen the Emirati financial crime system.

The authorities' efforts started in 2018, with the passage of an anti-money laundering law, but according to some independent reports the results are still far from desired due to the implementation of the rules.

In an April 2020 report, the intergovernmental Financial Action Task Force (FATF), which comprises 37 countries and international organisations, recommended that the UAE close gaps in the real estate and precious metals markets that could be exploited for money laundering.