UAE central bank to penalize unlicensed virtual asset service providers
The Central Bank of the United Arab Emirates (CBUAE), along with other regulators in the country, has recently published new joint guidance for virtual asset service providers (VASPs) operating within the country. The new guidelines include penalties for VASPs operating without proper licenses within the jurisdiction.
The National Anti-Money Laundering and Combating Financing of Terrorism and Financing of Illegal Organisations Committee (NAMLCFTC), in collaboration with UAE supervisors, has issued guidance on combating the use of unlicensed virtual asset service providers, which is prepared by…
— Central Bank of the UAE (@centralbankuae) November 6, 2023
On Nov. 6, the National Anti-Money Laundering and Combating Financing of Terrorism and Financing of Illegal Organisations Committee (NAMLCFTC) and the CBUAE published a list that they described as “Red Flags” for VASPs. The list included a lack of regulatory license, unrealistic promises, poor communications, lack of regulatory disclosures and more indicators that could identify suspicious parties.
According to the new guidance, the supervisory authorities expect all licensed financial institutions (LFIs), designated non-financial businesses and professions (DNFBPs) and licensed VASPs to report transactions from suspicious parties. The guidance wrote:
“Any information related to unlicensed virtual asset activities can be reported through whistleblowing mechanisms, to help regulatory authorities in their efforts to uphold the law and protect the UAE financial system.”
In the new document, the central bank also noted that VASPs operating in the UAE without a valid license will be subjected to “civil and criminal penalties including, but not limited to, financial sanctions against the entity, owners and senior managers.” In addition, the document also highlighted that LFIs, DNFBPs and licensed VASPs that demonstrate a willingness to deal with unlicensed VASPs will also be subject to actions from law enforcement.
In a press release, His Excellency Khaled Mohamed Balama, governor of the CBUAE and chairman of the NAMLCFTC, said that the new guidance comes at a time when digital assets have become more accessible. The CBUAE executive explained that as the digital economy matures, their work on “combating all kind of financial crimes intensifies.” This ensures the integrity of the financial system in the UAE, according to Balama.
Related: Lawyer explains new federal virtual asset law in the United Arab Emirates
Commenting on the update, UAE lawyer Irina Heaver told Cointelegraph that the new guidance is part of a broader effort from the UAE to be removed from the Financial Action Task Force’s (FATF) “grey list.” This list indicates that a country has deficiencies in its Anti-Money Laundering (AML) and Counter-Terrorist Financing (CTF) regimes but has committed to resolving these issues within agreed timeframes.
In March 2022, the UAE was placed on the FATF’s grey list and subjected to increased monitoring due to deficiencies in AML and CTF. However, the country made a high-level commitment to work with the global watchdog to strengthen its AML and CTF regimes.
According to Heaver, the UAE has enacted significant reforms since its placement on the grey list in 2022. With new updates to its AML and CTF regulatory frameworks, the country may exit the grey list soon. “The next FATF review, expected in April or May 2024, could lead to the UAE’s exit from the grey list if it continues to demonstrate consistent compliance,” she added.
Magazine: Slumdog billionaire 2: ‘Top 10… brings no satisfaction’ says Polygon’s Sandeep Nailwal
Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.
You may also like
Chinese Analyst Assesses Ethereum’s Status, Says “Whales Have Run Out of Purchasing Power” – Here’s What He Expects
Chinese cryptocurrency analyst phenomenon Murphy evaluated the latest status of Ethereum in his statement. Here are the details.
Skipped Bitcoin Cash? Qubetics ($TICS) Could Be Your Redemption Ticket – Top Cryptos for Significant Returns
The crypto market has been on fire lately. With the spotlight shifting to new and innovative blockchain projects, everyone’s eyes are on which cryptos will make waves this year.Bitcoin Cash: A Missed Opportunity for Significant ReturnsQubetics: Revolutionizing Digital Finance with Real-World Asset TokenizationConclusion: Time to Act on Qubetics
BTC Short Position by ETH Whale Nears $332M
A crypto whale boosts their BTC short position to $332M, facing losses and potential short squeeze risk.Whale Boosts BTC Short Position Amid Market VolatilityRisk of Liquidation LoomsStrategic Buy Orders Placed

Pakistan Launches Crypto Council Led by Finance Minister
Pakistan forms Crypto Council to boost blockchain and crypto adoption, chaired by Finance Minister Muhammad Aurangzeb.Pakistan Takes a Bold Step Toward Crypto AdoptionFinance Minister to Lead the InitiativeFocus on Innovation and Financial Inclusion

Trending news
MoreCrypto prices
More








