UAE issues anti-money laundering guidance for exchange houses

New guidelines have been issued in the UAE to help licensed exchange houses (LEH) to combat money laundering and the financing of terrorism.

The UAE Central Bank (CBUAE) has given exchange houses one month's time to comply with the latest rules that came into effect on Wednesday.

These entities must maintain an effective programme designed to prevent misuse of their business to facilitate money laundering or terrorist financing.

"LEHs must conduct a regular risk assessment process that covers all commensurate risks to their exchange business, including customer, products and services, delivery channel, new technologies, geographic, counterparty and illicit finance risks," the Central Bank said.

The banking regulator also said the risk assessment findings should inform the programme’s comprehensive policies, procedures, internal controls and employee training to mitigate risks effectively.

The latest move will assist LEH's understanding of risks and effective implementation of their statutory anti-money laundering and combatting the financing of terrorism (AML/CFT) obligations, and takes Financial Action Task Force (FATF) standards into account.

"The CBUAE takes its regulatory and supervisory duties extremely seriously. We want to ensure that all licensed exchange houses in the UAE understand their AML/CFT responsibilities, have adequate programmes to identify and mitigate AML/CFT risks in their operations, and comply fully with their statutory obligations," explained Khaled Mohamed Balama, Governor of the CBUAE.