Middle East Compliance Regulations and Guidelines
Explore the impact of anti-bribery and corruption regulations across the Middle East, US, UK, Europe, South America, and Asia—crucial considerations based on your company's global operations. Stay informed about recent laws that extend their reach beyond borders.
Anti-Money Laundering Regulations for Designated Non-Financial Businesses and Professions in the UAE
In November 2020 the Ministry of Economy (UAE) announced the launch of an awareness and monitoring campaign to encourage the Designated Non-Financial Businesses and Professions (DNFBPs) to register in the Ministry’s approved systems to combat money laundering and the financing of Terrorism in the country by the end of April 2021. DNFBPs establishments that have not registered themselves in these systems will be penalized starting May 1st. Fines for not adhering to AML regulations could range from Dh50,000 ($13,613) to Dh5 million.
Designated Non-Financial Businesses and Professions, which are being supervised by Ministry of Economy with regard to anti-money laundering and combating financing of terrorism, include a wide range of non-financial sectors and activities that are most exposed to money laundering risks. They have been divided according to the implementing regulations of the law - and in line with international standards issued by the Financial Action Task Force (FATF) - into the following four categories:
- Brokers and Real Estate Agents,
- Dealers of Precious Metals and Precious Stones,
- Independent accountants and auditors
- Corporate Service Providers.
The main objective of the Ministry's campaign is to intensify communication with this sector, to educate it about the dangers of money laundering; create awareness on the Federal Law regarding anti-money laundering; combat financing of terrorism and illegal outfits, and ensure its compliance with its provisions. The Ministry also seeks to create awareness on the penalties for violation, in addition to ensuring the implementation of recognized global practices for these businesses and professions.
If you are an organization in the UAE and you want to avoid getting fined you have to ask the following questions:
Does your organization fall into the category of a DNFBP? Has your DNFBP registered in Ministry’s approved systems? Has your DNFBP taken the main steps to protect itself from the risks of money laundering?
The Ministry of Economy has prepared guidelines to provide guidance and assistance to DNFBPs but they will be responsible for meeting all the requirements and choosing the best tools in order to do so. Here is where Nexis Solutions can help you!
Here is what you need to do and where Nexis Solutions can help you!
| PEPs Best Practice | How Nexis Solutions Can Help | |
|---|---|---|
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Know your customer—A corrupt customer can ruin a financial institution’s reputation and expose it to legal and financial penalties. Companies must do all their can to identify PEPs among their lists of current and prospective customers and associates. This presents a challenge because, although governments maintain lists of sanctioned individuals, there is no universal list of PEPs. | Use BatchNameCheck to conduct high-volume batch screening of third parties against sanctions, PEPs, watchlists and blacklists from more than 240 countries and territories, and translated from multiple languages |
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Establish a PEP’s source of wealth—This is not only a recommendation of the FATF but increasingly expected by regulators. For example, the FFIEC Bank Secrecy Act/AML Examination Manual recommends identifying the account holder and its beneficial owner, asking the individual directly about their PEP status, their employment or other sources of funds, the purpose of the account, and the expected volume and nature of account activity. | •Tap into Dun & Bradstreet® Ultimate Beneficial Ownership data in Nexis Diligence to capture a clear view of the percentage of ownership, from .01% to 100%. • Access company information including corporate hierarchy data to help identify additional signs ofbeneficial ownership, such as shell companies |
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Take a risk-based approach to assessing PEP risk—Where accounts with a PEP risk are identified, they should be subject to risk-aligned due diligence to detect suspicious activity. For example, the UK’s FCA advises companies that domestic PEPs carry a lower risk of money laundering and corruption than foreign PEPs. | • Conduct appropriate due diligence on individuals and entities against global negative news content, company information, Experian® business data, legal information and public records*— all in one place—with Nexis Diligence™ |
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Carry out ongoing monitoring— Relationships with existing PEPs should be regularly reviewed and due diligence information should be updated. A decision should then be made on whether the risk assessment for a particular PEP remains the same. If an individual loses their position which made them a PEP, monitoring should continue for 18 months afterwards. | • Implement automated risk monitoring of PEPs with Nexis®Entity Insight to stay alert to new red flags that may surface over time |
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Train staff and set a clear tone from the top—Staff members should learn how to identify clients who are PEPs as part of an AML training program. They should be encouraged to consult with senior management before beginning or renewing a relationship with a PEP. | •Talk to us. Our solutions consultants have a wide range of best practices tools available to share. |
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Harness technology—Firms should take advantage of technology to support the monitoring of information from a wide range of sources. Databases can quickly and cost-effectively screen thousands of customers against sanctions lists, PEPs lists, adverse media, and enforcement data. They can provide enriched data on PEPs and use analytics techniques to increase the accuracy of screening rates and reduce the impact of false positives. Machine learning and natural language processing can also enable firms to spot suspicious transactions and assess their risk. | • Integrate risk-related datasets into your existing tools through Nexis Data as a Service • Accelerate due diligence byintegrating Blue Prism®connected-RPA with Nexis Diligence™.Speak with a Nexis® Solutions consultant by calling 0330 161 1234 for more information or visit us on the web: bis.lexisnexis.co.uk/lexis-diligencebis.lexisnexis.co.uk/lexisnexis-entity-insight |
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E-Mail: middleeast@lexisnexis.com
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