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In a landmark move, the UAE has enacted a comprehensive overhaul of its anti-money laundering (AML) and countering the financing of terrorism (CFT) framework, signaling a decisive shift from compliance to enforcement. This new legislation repeals and replaces the 2018 AML Law, introducing stringent penalties, expanded regulatory scope, and enhanced governance structures.
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The New AML Framework
1.Enhanced Penalties
- Individuals: Fines up to AED 5 million and imprisonment ranging from 5 to 10 years for severe violations.
- Corporate Entities: Fines up to AED 100 million or the value of the laundered assets, whichever is higher.
- Failure to Report: Non-compliance with suspicious transaction reporting (STR) obligations can result in fines from AED 10,000 to AED 1 million, and individuals may face imprisonment for 1 to 6 months.
2.Expanded Regulatory Scope
- Virtual Asset Service Providers (VASPs): The new law formally incorporates VASPs into the AML/CFT regime, subjecting them to the same stringent requirements as traditional financial institutions.
- Designated Non-Financial Businesses and Professions (DNFBPs): Sectors such as real estate, legal services, and precious metals trading are now under closer scrutiny, ensuring comprehensive coverage of high-risk industries.
3.Strengthened Governance and Oversight
- National Anti-Money Laundering and CFT Committee: A Supreme Committee, operating under the Presidential Office, has been established to drive strategy and coordination across all regulatory bodies.
- Central Bank of the UAE (CBUAE): The CBUAE’s authority has been expanded to impose administrative and financial penalties for violations, with the maximum fine increased to AED 1 billion.
4.Mandated Transparency and Disclosure
- Beneficial Ownership: Entities are required to disclose their beneficial owners, enhancing transparency and accountability.
- Cross-Border Declarations: Mandatory declarations for cash, precious metals, and stones when entering or leaving the country, closing loopholes in asset movement and ownership concealment.
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Statistical Insights
- Fines Imposed: In the first half of 2025, over AED 380 million in AML-related fines were levied across various sectors, including banking, real estate, and exchange houses.
- Enforcement Actions: Notable cases include a AED 200 million fine on an exchange house and AED 5.9 million on a foreign bank branch for AML compliance failures.
Implications for Businesses
- Immediate Compliance Required: The new law mandates that businesses align their internal frameworks, risk assessments, and reporting procedures within a narrow window following its enactment.
- Increased Scrutiny: With the expanded scope, businesses in high-risk sectors must enhance their due diligence processes to mitigate potential violations.
- Enhanced Penalties: The significant increase in fines underscores the necessity for robust compliance programs to avoid severe financial and reputational damage.
How NR Doshi & Partners Can Assist
At NR Doshi & Partners, we offer comprehensive services to help businesses navigate the complexities of the new AML framework:
- Policy Development: Assistance in drafting and implementing AML policies and procedures tailored to your business needs.
- Training Programs: Conducting workshops and training sessions to educate your team on the new regulations.
- Risk Management: Providing guidance on effective risk assessment and mitigation strategies.
- Compliance Audits: Performing thorough audits to ensure your business complies with the new AML laws.
