UAE Central Bank imposes financial sanctions on a bank over illegal financing policies

UAE: The Central Bank of the UAE (CBUAE) imposed a financial sanction on a bank operating in the UAE, pursuant to Article 14 of the Federal Decree Law No. (20) of 2018 on Anti-Money Laundering and Combating the Financing of Terrorism and Financing of Illegal Organisations, state news agency WAM reported Friday.

The financial sanction is the result of the findings of an examination conducted by the CBUAE, which revealed that the bank had deficiencies in its AML/CFT policies and procedures. Accordingly, the CBUAE has imposed a fine of Dh 5.8 million on the bank. The authority did not name the bank.

The CBUAE, through its supervisory and regulatory mandates, works to ensure that all banks, their owners and staff abide by the UAE laws, regulations and standards adopted by the CBUAE to safeguard the transparency and integrity of the banking sector and the UAE financial system.

The Central Bank had imposed administrative sanctions on eight banks operating in the UAE last year, pursuant to Article 137 of the Decretal Federal Law No. (14) of 2018 Regarding the Central Bank and Organisation of Financial Institutions and Activities, and the Central Bank notices regarding the beneficiaries of the Nationals Defaulted Debts Settlement Fund (NDDSF) facilities.

The administrative sanctions take into account the banks’ failures to comply with the CBUAE’s instructions not to grant any loans or credit facilities to the beneficiaries of loans granted by the NDDSF, including credit cards.

Recently, the CBUAE has allowed licensed entities ample time to align their processes with compliance requirements. The latest enforcement measures signal a shift towards stricter regulatory oversight in the UAE’s banking sector.