Combatting Illicit Finance: UAE Establishes Special Agencies to Tackle Money Laundering

Combatting Illicit Finance: UAE Establishes Special Agencies to Tackle Money Laundering

On Sunday, the UAE revealed its intentions to set up judicial institutions responsible for prosecuting money laundering and financial crimes, prompted by heightened scrutiny from an international watchdog focused on combating illegal financial activities.

The decision came after the UAE Federal Judicial Council, led by Abdullah Sultan bin Awad Al Nuaimi, endorsed the proposal put forth by the UAE Attorney General to create specialised federal prosecution units dedicated to handling economic crimes and money laundering.

According to WAM, the UAE's official news agency, the creation of prosecution offices specializing in economic crimes and money laundering is an integral part of the Ministry of Justice's ongoing transformative projects, known as government accelerators. These initiatives are being developed in collaboration with the Federal Judicial Council, with the aim of enhancing professional and legal performance throughout the UAE.

The establishment of these dedicated entities marks an important initial stride towards effectively investigating and combating economic crimes and money laundering, encompassing a wide range of offenses such as corporate crimes, bankruptcy, competition regulation, financial market violations, intellectual property infringement, trademarks, and crimes that infringe upon the UAE's financial rights, such as customs evasion.

“The project’s significance lies in its role in protecting the national economy and reducing the impact of economic and financial crimes on the economy and society, as well as growing the UAE's economy and enhancing its competitiveness as a global financial and business hub for investment and improving the efficiency and quality of criminal investigations,” WAM said.

The UAE has started to demonstrate its intention to fight against economic crimes and money laundering. Through various pivotal measures, the country is reinforcing its legislative and legal framework to effectively address these challenges. By doing so, the UAE aims to safeguard its national economy and bolster the confidence of global investors in the country's business environment. These concerted efforts are also designed to attract international businesses, encouraging them to establish their operations within the UAE.

Interestingly, the decision to set up a new judicial body is seen as a belated effort to remove an embarrassing taint following the Paris-based Financial Action Task Force (FATF) in March 2022 adding the UAE to a “grey list" of nations subject to greater oversight because of concerns over illicit finance.

The watchdog has maintained its stance since then. However, a June FATF report highlighted notable improvements in the UAE's efforts to address the identified shortcomings.

Despite successfully diversifying its economy and reducing reliance on oil, the desert country has faced criticism from experts and international organizations for not adequately addressing suspicious financial transactions. Addressing these issues remains an important challenge for the UAE to bolster its reputation and financial integrity on the global stage.