Register or face penalties, Hawala providers in the UAE told

All activities of the Hawala operators will be subject to registration, monitoring and scrutiny in accordance with the law. - Reuters

Hawala providers in the UAE will have to register with the central bank within 90 days and action will be taken for failure to do so, including financial penalties and imprisonment, the banking regulator said on Wednesday.
It said a resident natural person may not carry on Hawala activity in the country unless he or she holds a Hawala Provider Certificate issued by the Central Bank of the UAE.
The certificate is valid for one year and will be renewable for a similar period.
The commercial name of a Hawala provider should not include any financial activity term, such as bank, exchange house or any other licensed activity. He or she has to manage his business personally and never assign such task to another person.
The newly-introduced registration system is aimed at safeguarding the UAE's financial system.
Hawala, which is also known as hundi, is an unofficial and informal channel to transfer money whereby they hand over money to agents who then instruct their associates in the country to deliver it to the customer's house.
With the UAE being a one of the major markets for remittances due to a large population of expatriates, regulating this informal industry will help monitor money-laundering and counter terror funding.
The central bank said all activities of the Hawala operators will be subject to registration, monitoring and scrutiny in accordance with the law and the anti-money laundering and countering financing of terrorism regulations in the country. Hawala operators are required to register all their activities with the central bank.
Hawala service providers will not be able to change their address, place of residence/business, sponsor or commercial activity without prior approval of the apex bank. Also, they will have to carry out activity in suitable premises that enable Central bank's staff to visit and examine their record.
In addition, Hawala providers will have to upload details of all transfers, remitters and beneficiaries on a daily to the central bank's system on a daily basis.
The applicant - Hawala provider -- hould be of good conduct and behaviour and has not been convicted of any crime of honour or honesty and has not failed to honour his liabilities towards financial institutions or any other creditors.
Furthermore, the applicant should not have been declared bankrupt nor reached a settlement agreement with his creditors or have his property confiscated or put under receivership. - waheedabbas@khaleejtimes.com