Author: Nicola Sharp 8 April 2021
Nicola Sharp, of financial crime specialists Rahman Ravelli, considers the factors that have led to the Gulf state taking action.
The United Arab Emirates is restricting the movement of cash and precious metals as part of its attempt to tackle financial crime.
The latest restrictions in the UAE, which is one of the world’s largest gold hubs, come three years after a tightening of financial regulations that aimed to remove the Gulf state’s reputation as a popular destination for the proceeds of crime.
Procedures for submitting suspicious banking reports, a unified electronic customs platform and regulations relating to the movement of cash and precious metals have now been announced by the UAE Executive Office to Combat Money Laundering and Terrorist Financing.
The Executive Office, which was only set up two months ago, said: “Through the adoption of these technical controls, the Executive Office hopes to strengthen the UAE’s efforts to curb illicit flows of funds, promote asset recovery, and combat all forms of transnational financial crime.”
Bullion worth billions of dollars is exported from the UAE to refiners that are accredited by the London Bullion Market Association (LBMA). But six months ago, the LBMA warned that it may prevent bullion from the UAE - and a number of other countries - being allowed into the mainstream market. This was prompted by LBMA fears that the bullion may not meet regulatory standards.
A month after this warning, the UAE gave its backing to moves by the LBMA to improve regulation to tackle issues such as money laundering and unethical gold sourcing.
Such attempts to combat wrongdoing are unsurprising. It has long been known that precious metals such as gold have been - and continue to be - used as a money laundering tool by criminal enterprises; especially in countries such as the UAE, which has always been viewed as high risk.
While the UAE tightened its regulations regarding anti money laundering and terrorist financing back in 2018, it has now recognised a need to further strengthen them in order to try and prevent the use of such commodities in financial crime
Nicola is known for her fraud, civil recovery and business crime expertise, her experience of leading the largest financial disputes and multinational investigations and her skills in devising preventative measures and conducting internal investigations for corporates.