UAE Law and Practice Contributed by: Stuart Paterson, Janine Mallis, Tania Forichon and Elif Eren Ozenir, Herbert Smith Freehills Kramer LLP
Under Article 48 of the Penal Code, accomplices will be subject to the same punishment imposed on the perpetrator (although exemptions may apply for the perpetrator’s spouse or relatives). However, under Article 53 of the Penal Code, where the characterisa - tion of the crime or penalty varies according to the offender’s intention or knowledge of the circumstanc - es, accomplices will be punished according to their Money laundering is criminalised under the AML Law. The substantive money-laundering offences are in Article 2 of the AML and include, for example, trans - ferring or moving the proceeds of a crime or conduct - ing any transaction with the aim of concealing or dis - guising its illegal source. own knowledge or intention. 3.13 Money Laundering Article 2 of the AML Law provides that any person who intentionally commits any of the acts knowing that the funds are the proceeds of a felony or misdemeanour will be deemed to have committed a money-launder - ing crime. It is also an offence under the AML Law to warn or tip off a person or reveal transactions under review, or reveal that the competent authorities are investigating such suspicious transactions. The maximum penalty for an individual for breach of the AML Law is a fine of AED50 million and imprison - ment for a period not exceeding ten years. Notably, the AML Law provides no time bar on the prosecution of money laundering and terrorist financing. Obligations to Prevent Money Laundering Financial institutions have specific obligations to pre - vent money laundering under the AML Law and Cabinet Decision No 10 of 2019 Concerning the Implementing Regulation of the AML Law (the “AML Implementing Regulation”), and must put in place specific meas - ures as provided for in the AML Implementing Regula - tion. For example, they must put indicators in place to identify suspicious money-laundering transactions and submit STRs, and appoint a compliance officer in charge of reviewing the company’s compliance with the anti-money laundering laws and regulations (Article 21). There are numerous other obligations,
including conducting client due diligence checks and maintaining records for a prescribed period of time. Regulatory and Supervisory Bodies The FIU is an independent unit within the UAE Central Bank, and has the authority to: • request that financial institutions provide any information or additional documents relevant to the reports and information received by the FIU, in addition to other information the FIU considers necessary to perform its tasks within the time and in the form it determines; and • exchange information with counterpart units in other states concerning STRs (where the UAE has entered into co-operation agreements with such states). There are several supervisory authorities under the various AML laws and regulations, including the Min - istry of Economy for Designated Non-Financial Busi - nesses and Professions at the Federal Level, which have broad powers in respect of conducting checks and imposing penalties on financial institutions to miti - gate the occurrence of money laundering. In addition, the National Anti-Money Laundering and Combating Financing of Terrorism and Financing of Illegal Organisations Committee (“NAMLCFTC”) was established as the UAE’s primary AML and CFT policy - making body. Specialist money-laundering courts have been established across the UAE. The federal judicial council also recently approved the creation of special - ist federal prosecution entities to address economic crimes and money laundering. This aligns with the UAE’s strategy to embed a robust financial crime compliance framework that is aligned with FATF recommendations. 3.14 ESG-Related Offences There is no comprehensive ESG-related criminal framework in the UAE. Enforcement of ESG obliga - tions is primarily administrative and regulatory. Specific offences exist in relation to environmental and social misconduct. Federal Law No 24 of 1999 Concerning the Protection and Development of the Environment criminalises violations such as pollu - tion, illegal waste disposal, damage to ecosystems, and poaching or illegal trade in endangered species.
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