SHARJAH, 4 October 2005 — With tens of millions of dollars being brought into the UAE daily by foreign investors, the central bank of the country has sought to set the record right by announcing that it is closely monitoring the flow in order to prevent the entry of dirty money or funds suspected of financing terrorist activities.
The move is aimed at safeguarding financial institutions and the banking system against money laundering and terrorist financing, a senior official of the central bank said in a statement carried by the official news agency, WAM.
It comes in the wake of the inflow of foreign funds to invest or subscribe to initial public offerings of local companies such as Dana Gas.
Abdul Raheem Al-Awadi, assistant executive director of the Anti-Money Laundering and Suspicious Cases Unit in the central bank, said the UAE has effective laws to curb money laundering and prevent misuse of its financial and banking system for suspicious purposes. He said these laws are applied to all funds coming into the local market.
“The central bank has introduced a permit system for foreign funds which is applied at all the ports by the Federal Customs Authority to ensure that funds flowing into the country are clean,” he said on the sidelines of a seminar on Legal and Regulatory Framework Implementing Anti-Money Laundering and Combating Terrorist Financing.
“The UAE and other GCC countries are implementing international laws and regulations to combat money laundering and terrorist financing,” he said, and the UAE constantly updates these laws and develops new measures and procedures.
He noted that anti-money laundering laws are already enforced in all federal and local financial institutions including the Dubai International Financial Center and free zones.
These laws have encouraged investors from all over the world to invest in the UAE markets, Al-Awadi said. He said the UAE laws are in line with international laws and the 40 recommendations of the Financial Action Task Force and its nine special recommendations. Money laundering a legally defined as a serious crime and it is linked to other legislation covering terrorist attacks. The UAE has joined the International Convention on Combating corruption, which will take affect from Dec.15, he said.
All banks, money changers and registered hawala dealers in the country are under instructions to report all incoming and outgoing transfers above certain limit.
Everyone who wants to remit more than 2,000 dirhams has to produce a valid passport or workpermit issued by the UAE authorities. The central bank has also set up a special unit to monitor incoming and outgoing transfers.
