FATF likely to place UAE on grey list

The Financial Action Task Force (FATF) is expected to add the United Arab Emirates (UAE) in the grey list of countries over failure to combat money laundering and terror financing.

The UAE, a major financial hub in the Middle East, is likely to be added to FATF’s grey list early this year during its upcoming plenary meeting scheduled for late February, reported Bloomberg quoting unnamed sources.

It was reported that the UAE had submitted a report to the FATF in November but failed to reach many of the thresholds needed to stay off the grey list.

However, there are still several chances for Emirati officials to plead their case to the FATF, including during a planned trip to Paris in the coming weeks.

Since that warning, the UAE government has taken numerous steps to better align with global financial standards, including issuing new guidelines, setting up courts focused on financial crimes, and establishing the Office for Anti-Money Laundering and Counter-Terrorist Financing.

Still, the United States currently lists the UAE as a “major money-laundering” jurisdiction.

If it is designated, the UAE would join the likes of 23 countries including Syria; Yemen; South Sudan; Jordan; as well as Turkey – which was grey-listed last October.

Hamid al-Zaabi, director-general of the UAE Executive Office for Anti-Money Laundering and Counter-Terrorist Financing, told Bloomberg that the country was taking the issue “very seriously” and it has “partnered with highly skilled and experienced specialists with a track record in meeting best international practices and standards”.

“The UAE is fully committed to upholding the integrity of the international financial system, which includes working closely with our partners around the world to combat financial crime,” he said.

Following the publication of the Bloomberg report, a London-based online news outlet Middle East Eye reached out to the UAE’s embassy in Washington for comment but did not receive a response by the time of publication.

Grey-listing by the FATF applies to countries that have “strategic deficiencies in their regimes to counter money laundering, terrorist financing, and proliferation financing” but are still committed to addressing the issues “swiftly”, according to the watchdog’s website.

A spokesperson for the FATF said they could not comment, but referred MEE to a report published in April 2020, where the watchdog said the UAE has made improvements but added it continues to face major risks when it comes to money laundering.