AML compliance in the Middle East and North Africa (MENA) region has been evolving fast via strengthened regulations, increased scrutiny, and a growing adoption of risk-based approaches underpinned by technology. The Financial Action Task Force (FATF) has noted that many nations in the region have made significant strides in improving their compliance frameworks, including implementing stricter beneficial ownership transparency and enhancing enforcement.
The United Arab Emirates (UAE) stands out in the MENA region based on the rapid pace with which it has modernized and adopted both policies and technologies needed to continually strengthen its AML/CFT regime.
Continued advances from just one year ago
As we noted in this September 2024 blog post on the AML/CFT compliance progress by the UAE, following approval by the UAE Cabinet on September 2, 2023, the country announced a National Strategy for Anti-Money Laundering, Countering the Financing of Terrorism and Proliferation Financing (AML/CFT/CPF) for the years 2024-2027. The strategy was formulated with reference to the latest UAE National Risk Assessment, which was developed using the World Bank Group’s methodology, to align with international standards. This came after FATF removed the UAE from its Grey List, underscoring the UAE’s progress toward upholding international standards. “The FATF welcomes the UAE’s significant progress in improving its AML/CFT regime. The UAE strengthened the effectiveness of its AML/CFT regime to meet the commitments in its action plan regarding the strategic deficiencies that the FATF identified in February 2022.”
More advances came in September 2024 when the UAE approved the 2024-2027 National AML/CFT Strategy, prioritizing cybercrime, digital payments, and trade-based money laundering (TBML). Then, in December 2024, the UAE launched the National AML/CFT Committee General Secretariat to enhance AML policy implementation and global regulatory alignment as well as to ensure that businesses operating in the UAE meet international compliance standards. Most recently, the CBUAE imposed a financial sanction of AED 3 million against organizations violating the standards.
Who regulates Financial Crime compliance in the UAE today?
There is no single body that regulates financial crime compliance in the UAE in 2025. Instead, AML/CFT enforcement happens as the result of close coordination between multiple bodies. Here’s a useful breakdown:
General AML Enforcement: Federal and local bodies coordinate on AML enforcement.
- The CBUAE regulates financial institutions (FIs)
- The Ministry of Economy (MOE) oversees designated non-financial businesses and professions( DNFBPs), including lawyers, precious metals dealers, and real estate agents.
- The Securities and Commodities Authority (SCA) monitors securities firms.
- The Financial Intelligence Unit (FIU) processes Suspicious Transaction Reports (STRs).
- At the more local emirate level:
- The Dubai Department of Economy and Tourism and Dubai Police investigate AML violations
- The Abu Dhabi Department of Economic Development and Abu Dhabi Police oversee compliance in the capital.
- The Sharjah Economic Development Department and local law enforcement focus on TBML risks in trade-heavy industries.
Crypto & FinTech AML: The UAE has seen rapid growth in these sectors. As a result, regulating bodies are increasing their oversight.
- The Virtual Asset Regulatory Authority and the Securities and Commodities Authority (SCA) have a formal agreement in place to standardize AML regulations for crypto exchanges across the UAE. They now require virtual asset service providers (VASPs) to implement robust KYC programs that include cross-border transaction monitoring (TM), wallet verification, and blockchain forensics.
AML in UAE financial free zones: Regulators in the free zones are designed to specifically assist international businesses as they adapt to global standards and try to balance those with specific UAE rules and regulations.
- The Dubai International Financial Centre (DIFC) and Abu Dhabi Global Market (ADGM) each have their own AML framework and make every effort to align with UAE federal regulations.
- The Dubai Financial Services Authority (DFSA) enforces customer due diligence (CDD) without a transaction threshold, and the ADGM’s Financial Services Regulatory Authority (FSRA) applies a three-tier CDD system, with stricter oversight of crypto-related transactions.
- Regarding politically exposed persons (PEPs), the DFSA stresses the need for ongoing monitoring and enhanced due diligence (EDD). Businesses can perform CDD based on customer risk profiles. However, they must immediately file STRs when they spot suspicious activity.
The costs and penalties of compliance failure
Along with their stricter and more comprehensive AML/CFT regulations, the UAE has made it more costly for businesses when they fail to comply. Here are the penalties:
- Imprisonment of individuals for 5 to 10 years and/or fines ranging from AED 5 million to AED 50 million.
- Corporate fines up to AED 50 million for money laundering offenses.
- Failure to file STRs or conduct sufficient CDD brings penalties of AED 10,000 to AED 1,000,000. Individuals may also be imprisoned for 1 to 6 months.
- Possible revocation of licenses
- Possible asset freezes
To be sure, the UAE has recently fined one foreign bank branch AED 5.9 million for AML compliance failures and revoked multiple licenses among precious metals dealers who have breached the laws and regulations.
Recent enforcement actions highlight this tough stance: the CBUAE imposed fines of AED 3 million on a UAE bank and AED 5.9 million on a foreign bank branch for AML compliance failures. Additionally, the MOE revoked the licences of numerous precious metals dealers for persistent breaches. These measures reinforce the UAE’s zero-tolerance policy, urging businesses to prioritise compliance to protect operations and credibility.
How to easily meet your AML compliance Obligations
As the leading provider of AI Agents focused on performing financial crime compliance processes, WorkFusion is mitigating the risk of compliance failure for banks and other organizations worldwide. Specific to the UAE’s recent regulatory enhancements and requirements, we provide AI Agents that focus in each area:
AI Agent Edward performs EDD by automating rigorous information gathering, streamlining transaction analysis, and drafting insightful reports.
AI Agent Isaac automates AML Transaction Monitoring (TM) alert review and streamlines case investigations.
AI Agent Kayla keeps tabs on your customers across an ecosystem of systems and sources by performing perpetual KYC and/or KYC refresh.
AI Agent Evelyn performs PEP screening alert review, reducing up to 70% of the manual effort in reviewing and dispositioning sanctions and PEP alerts.
AI Agent Evan performs adverse media alert review by sifting through potential negative news articles and clearing away false positive alerts, while prioritizing potential areas of risk.
AI Agent Tara reviews payment sanction screening alerts and quickly dispositions payment alerts to maintain compliance.
To learn more about the many ways WorkFusion AI Agents can keep you compliant in the fast-evolving world of AML/CFT, request a demo today.
