AML in UAE: Guidelines for Filing Suspicious Transaction Reports

Financial Institutions (FIs), Virtual Asset Service Providers (VASPs) and businesses classified as Designated Non-financial Businesses and Professions (DNFBPs) are required to identify suspicious transactions and report them to the relevant UAE authorities. Filing of Suspicious Transaction Reports (STR) is a mandatory requirement as per the Federal Decree No. 20 of 2018 on Anti-Money Laundering and Countering the Financing of Terrorism (UAE AML Law). AML consultants in Dubai can assist the entities under obligation to file the STRs with the authorities promptly and accurately.

However, FIs, VASPs relevant DNFBPs (real estate agents, dealers of precious metals and precious stones, auditors and trust & corporate service providers) must know when to file the STRs and where to submit them. Any compliance failure related to STR filing in the UAE will attract hefty penalties. To avoid such unforeseen events, we have listed here a guideline for filing STRs in the UAE. Read ahead and ensure AML compliance in the UAE:

What is a Suspicious Transaction under AML in the UAE?

As per the UAE AML Law, a suspicious transaction is any transaction, attempted transaction or funds for which an entity under obligation has reasonable grounds to suspect as constituting any of the following:

• The proceeds of crime (Money laundering and related predicate offenses, or financing of terrorism or illegal organisations)
• Being related to the crimes of money laundering and related predicate offenses, the financing of terrorism or illegal organisations
• Being intended to be used in an activity related to such crimes

Suspicious Transaction Reporting Obligation for Entities

FIs, VASPs and DNFBPs are required to file STRs if they suspect the occurrence of suspicious transactions related to money laundering, fraud or terrorist financing during the establishment or course of the customer relationship, or while conducting transactions on behalf of a customer or a potential customer. Consult with AML consultants in Dubai if any STR assistance is required.

Where to File the Suspicious Transaction Reports?

The Financial Intelligence Unit (FIU) is the competent authority overseeing the filing of STRs in the UAE. If any suspicious transaction is spotted, you should report it to the FIU at the earliest. As per the AML-CFT Decision, FIs and DNFBPs are required to file the STRs through the goAML portal, which has been designed to submit all the major reports related to AML-CFT compliance in the UAE. FIs and DNFBPs, however, should ensure that the information provided in the STR regarding the suspicious transaction should be accurate, timely, and complete. Availing of AML consulting services in Dubai will help you to register STRs in the goAML portal.

What entities are exempted from filing STRs in the UAE?

All the FIs are required to report suspicious transactions to the FIU through the goAML portal. However, certain DNFBPs are exempted from the statutory reporting requirement. As per the AML-CFT Law and AML-CFT Cabinet Decision, specific DNFBPs such as lawyers, notaries, other legal professionals, and independent legal auditors are exempted from statutory reporting requirements on the grounds of professional secrecy. However, this exemption doesn’t apply to the other DNFBPs.

When to Submit STRs in the UAE?

DNFBPs and FIs in the UAE are required to submit the STRs to the FIU without any delay. There is no specific time threshold but entities should report the STRs to the FIU immediately after the suspicious nature of the transaction becomes clear.

Duty of an AML Compliance Officer Related to STRs

As per the AML-CFT Decision, an AML compliance Officer is required to “Review, scrutinize and study records, receive data concerning Suspicious Transactions, and take decisions to either notify the FIU or maintain the Transaction with the reasons of maintaining while maintaining complete confidentiality”. In this regard, FIs and DNFBPs should establish appropriate policies, procedures and controls for the internal investigation of suspicious transactions prior to STR submission.

Confidentiality in Reporting Suspicious Transactions

While reporting suspicious transactions to the UAE FIU, FIs and DNFBPs must maintain the confidentiality of both the information being reported and the act of reporting. The businesses under obligation must make reasonable efforts to ensure the information and data reported are protected from access by unauthorized persons. If any FI, DNFBP or their staff directly or indirectly tip off a customer regarding the STR, it will lead to a penalty of not less than AED100,000 and no more than AED500,000 and imprisonment for a term of not less than six months.

Penalties Related to the Submission of STRs in UAE

A penalty of AED 200,000 will be imposed on the entities that fail to respond to FIU’s requests for additional information regarding any reported suspicious transactions. A fine of AED 100,000 will be imposed on those who delay informing the FIU of a suspicious transaction report despite reasonable grounds to suspect that the business relationship with the customer is related to ML-CT in whole or in part. AML advisers in Dubai can help you ensure compliance with relevant laws and avoid hefty penalties.

Hire Best AML Consultants in Dubai, UAE

Ensuring AML compliance in the UAE is like walking a tightrope as many complex requirements are involved. Any misstep or compliance failure may attract hefty AML administrative penalties in the UAE. However, you can dodge penalties by hiring Jitendra Chartered Accountants (JCA) as your preferred AML consultants in Dubai.

JCA provides robust AML consulting services in Dubai that will enable you to ensure AML-CFT compliance without any hassle. We provide services such as implementing AML Policy and Procedures, assessment of tools and controls design, review of current AML Policy, planning of AML-CFT framework, AML audit and reporting, AML training for the staff, Assistance with goAML reporting and AML penalty appeal services, customer screening, customer due diligence, customer risk rating etc.