AML Risk Assessment in Financial Institutions
This article discusses Federal Decree by Law No 20 of 2018 on Anti-Money Laundering and Combating the Financing of Terrorism and Financing of Illegal Organizations in United Arab Emirates. Here we will see AML Risk Assessment in Financial Institutions in detail.
The Supervisory Authorities shall, each within the scope of its competence, carry out supervision, monitoring and follow up to ensure compliance with the provisions provided for in the present Decree-Law and its Implementing Regulation and shall have in particular, the following competences:
- Conduct a risk assessment on the likelihood of the perpetration of a Crime within the financial institutions, designated nonfinancial businesses and professions and non-profit organisations.
- Conduct Control and audit inspections over financial institutions, designated nonfinancial businesses and professions and non-profit organisations, both remotely and on site.
- Issue the decisions related to the administrative penalties in accordance with the provisions of this Decree-Law and its Implementing Regulation, the grievance mechanism, and keep statistics of measures taken and penalties imposed.
- Any other specialized activities stipulated in the Implementing Regulation of the present Decree-Law.
It is important to understand that the financial institutions are the main front line of defense against Money Laundering and Terrorism Financing as these institutions carry a lot of work to do. Banks/ financial institutions are the biggest source of money going in and out of country and in order to monitoe these transactions (suspected or not) the institution needs competence, supervision, monitoring and follow up to ensure compliance with the provisions provided for in the law.