A Checklist for DNFBPs to Prepare for Inspections by UAE AML Authorities

Designated Non-finance Businesses and Professions (DNFBPs) are required to comply with the UAE’s Laws on Anti-Money Laundering and Combating the Financing of Terrorism (AML-CFT). There is no room for compliance failures as the Ministry of Economy (MoE) conduct an inspection on your premises to check on your AML-CFT compliance. AML consultants in Dubai can help you prepare for the AML inspection by the supervisory authorities.

The MoE team conducts the AML inspections in the UAE in line with relevant provisions in Federal Decree Law No. (26) of 2021 on Ant-money laundering and countering the financing of terrorism, and Cabinet Decision No. (10) of 2019 read with Cabinet Resolution No. (24) of 2022 concerning the implementing regulation of the Federal Decree. As per these laws, you are required to assist the inspection team and provide all necessary information during the AML inspection. This gives us the indication that all the DNFBPs have to follow a serious and rigorous approach for the implementation of the AML law and its cabinet resolutions otherwise they will get huge amounts of penalties for the discrepancies found during the audit by the authorities. DNFBPs need to fill in the following details in the relevant sections:

Company Details of the DNFBP

DNFBPs need to provide the inspectors with the following company details:

• Company name as per trade license
• DNFBP category (dealers of precious metals and stones, auditors, real estate agents, auditors and trust and corporate services providers)
• Licensing authority
• License number
• License issue date
• Address
• Inspection date
• Registrar Representative Names & Title
• Entity Representative Names & Title
• Describe the establishment’s ownership structure up to the ultimate beneficial owner

General Policies and Procedures

In this section, the DNFBP has to state whether it has prepared a documented set of AML/CFT Policies and Procedures. If yes, the entity is required to provide the approved Policies and Procedures which are approved by your management.

Internal Risk Assessment

In this section, you have to mention whether your organisation has carried out and documented an internal risk assessment to understand its money laundering risks. You have to also state whether your documented risk assessment has considered the following categories such as Country risk, Customer risk, Products, services and transactions risk, and Delivery Channels Risk and Results of the UAE’s money laundering and terrorist financing National Risk Assessment. AML advisers in Dubai can assist you in this process. And also whether these risks are included in your AML/CFT Policies and Procedures or not.

Governance

Here, the Ministry wants to know if the DNFBP’s Board of Directors and/or senior management demonstrate overall responsibility and awareness of AML/CFT matters within the entity. You have to answer the following as well:

• Is the Senior Management involved in approving AML/CFT Policies?
• Is the Senior Management aware of AML/CFT Laws pertaining to DNFBPs?
• Does the Senior Management receive or review AML/CFT periodic reports?

Compliance Officer

The MoE wants to know whether the organization has appointed an independent compliance officer. If yes, you need to state the Compliance Officer’s name, CV, and JD (Job Description). The Ministry specifically wants to know whether the AML compliance officer has access to all the company’s records, including financials, and the name of the authority to whom the compliance officer reports.

Customer Due Diligence and Onboarding

In this section, the Ministry wants to know whether the organisation has a ‘Know Your Customer’ (KYC) form that covers the Source of Funds / Wealth, UBO information, PEP declaration. You have to answer the following specific questions:

• Are KYC forms obtained from applicable customers and held for record purposes?
• Is Customer Risk Rating performed and documented?
• Is adequate due diligence (CDD/ EDD) performed in accordance with the customer risk scoring?
• Does the entity identify PEPs during onboarding and on an ongoing basis?

Cash Transactions

The DNFBP has to state whether it has implemented any specific controls and procedures for cash transactions. The Ministry also want to know whether your entity performs ongoing monitoring of transactions. Specifically, you have to provide satisfactory evidence to show the source of funds and mention the percentage of cash transactions from your total transactions. AML consultants in the UAE can advise you further on this matter.

Suspicious Transactions Monitoring

Here, you have to answer the following:

1. Did the company register with the goAML platform?
2. Did the entity submit any Suspicious Transaction Report (STR) via the goAML platform?
3. Does the organisation have a documented list of red flags indicators for suspicious transaction as required by Article (16) of Cabinet Resolution No. (10) of 2019?
4. In the case of DPMS entities, does the entity submit DPMSR reports for transactions over AED 55,000?
5. In case of Real Estate entities, does the entity submit REAR reports for transactions over AED 55,000?
6. Does the company keep all records, documents, materials and data of all local or international financial, commercial and cash transactions, for at least five years from the date of completing the process or the end of relationship with the customer?

Training and Awareness

The company needs to give information such as whether all the staff have attended the AML training program and did the entity documented the annual AML training plan. AML advisers in Dubai can help you develop a robust AML training plan.

Targeted Financial Sanctions

The Ministry has designed this section in its AML inspection checklist to know whether any of your customers are in the sanctions list. This section requires you to answer the following questions:

• Have you subscribed to The Executive Office for Control and Non-Proliferation (EOCN) regarding the United Nations Security Council Consolidated Sanctions Lists and the Local Terrorist List?
• Does the company use screening tools to check if its customers are subject to targeted financial sanctions by the UN, the UAE or any other relevant body?

Independent AML-CFT Audit

In this section, you have to tell the Ministry whether you have conducted an independent audit on your AML-CFT policies and procedures. AML consultants in Dubai can perform an independent audit on your AML-CFT framework.

AML Consultants in Dubai can Help you Prepare for AML Inspections           

DNFBPs need to strengthen their AML-CFT framework to avoid any last-minute surprises or shocks during AML inspections in the UAE. You will incur hefty fines if the MoE inspectors find any compliance failure. However, AML consultants in Dubai such as Jitendra Chartered Accountants (JCA) can help you face the AML inspections confidently. We can help you ensure you tick all the boxes in the AML inspection checklist provided by the Ministry. 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 registration and AML penalty appeal services.