UAE’s success – exiting the FATF ‘Grey List’
The FATF made this announcement after conducting a successful on-site visit. This included a thorough assessment of all measures implemented by the UAE.
Since the publication of the FATF Recommended Actions (RAs) outlined in the FATF Mutual Evaluation Report UAE 2020, the UAE demonstrated steadfast commitment to addressing the RAs, through the implementation of an effective regulatory framework, characterised by the following key initiatives:
- Creating the Executive Office of Anti-Money Laundering and Counter-Terrorism Financing to counter money laundering and terrorist financing crimes.
- Establishing a dedicated court that specialises in money laundering and financial crimes.
- Implementing new AML/CTF guidelines for financial institutions and designated non-financial businesses and professions (DNFBP).
- Implementing a new Penal Code to fortify the UAE’s anti-bribery, corruption, anti-money laundering and terrorist financing regulations.
- Implementing stringent enforcement measures against financial crimes, including substantial fines, thorough inspections and new asset freezing requirements.
- Developing an automated intelligence platform known as ‘FawriTick’ that allows the integration of data on financial crimes across federal and local authorities, enhancing collaborative efforts in combatting financial malfeasance.
The decision by the FATF is a positive acknowledgment of the UAE’s commitment to adhering to international standards and creating a robust and effective regime against money laundering and terrorist financing. It is a major achievement for the UAE and is particularly significant considering its position as a growing international and regional financial centre.
Elevating global status
The removal of the UAE from the FATF grey list enhances the country’s global reputation and standing. This development is expected to catalyse trade, attract higher levels of foreign investment and drive economic growth. With increased confidence in the UAE’s financial system, there may also be a reduction in fees associated with international inter-banking transactions.
H.H. Sheikh Abdullah bin Zayed Al Nahyan, Minister of Foreign Affairs, and Chairman of the Higher Committee Overseeing the National Strategy on Anti-Money Laundering and Countering the Financing of Terrorism, stated, “This success is the outcome of significant and distinguished efforts by relevant ministries, the federal government and local entities. These collective endeavours serve to expedite the national strategy and action plan, achieve the directives and aspirations of the UAE’s leadership, aiming to further strengthen the country’s leading status and competitiveness, and advance its position globally as an economic, trading and investment hub.”
Hamid al Zaabi, the director general at the Executive Office of Anti-Money Laundering and Counter-Terrorism Financing (AML/CFT), stated that the aim is to continue improving the effectiveness of the UAE’s framework and approach, in line with international best practice.
The FATF will commence its fifth round mutual evaluation process in 2025, with the evaluation of the UAE expected to begin in 2026. This requires year-long preparations which will ensure the UAE remains committed to strong AML/CFT practices.
About the Financial Action Task Force (FATF)
The Financial Action Task Force (FATF) leads global action to tackle money laundering, terrorist and proliferation financing.
Further information
Read the ADGM’s statement on the UAE’s exit from the FATF List. ADGM’s Statement on the UAE’s Exit from the FATF List.
Read the FATF press release Jurisdictions under Increased Monitoring – 23 February 2024 (fatf-gafi.org)
If you would like to discuss this topic further, or have any questions, please reach out to your usual Waystone representative, or contact us below.
About Waystone
Waystone is the leading provider of institutional governance, risk and compliance services to the asset management industry. Partnering with institutional investors, investment funds and asset managers Waystone builds, supports and protects investment structures and strategies worldwide. With over 20 years’ experience and a comprehensive range of specialist services to its name, Waystone is now supporting asset managers with more than US$2Tn in AUM.