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UAE Sees Increasing Reports of Suspicious Financial Transactions

DUBAI - The UAE has seen a marked increase in suspected cases of money laundering, as the economic crisis hits home and more people in the financial services industy are prepared to report crimes, officials said on Tuesday.

The UAE Central Bank reported 6,198 suspicious tranasactions during the first five months of this year, up 14 per cent from 5,459 cases in the same period of 2008, according to the Dubai Financial Services Authority, 
or DFSA.

Part of this increase can be explained by greater vigilance on the part of banks, auditors and related firms, but some of it is a sign of current economic hardship, said Paul Koster, chief executive officer of the DFSA, a regulatory body.

“In downturns, people try to find alternative ways of making money. This happens to be one of them,” 
Koster said.

The central bank, the DFSA and the Securities & Commodities Authority are working together to train company employees to help prevent 
money laundering.

The DFSA recently completed spot checks on a large number of international banks and other companies operating at the Dubai International Financial Centre. It was the second of five such reviews that the DFSA plans for this year, compared to the three reviews it made in 2008 — a sign of its intensifying effort to squelch money-laundering, accidental or deliberate, Koster said.

The latest review turned up few violations, he said.

“We have seen some weaknesses, but we have not seen a complete ignorance or a complete omission in all areas. ... What I am worried about is that it is a complicated topic. You can get lured into money laundering.”

Koster described the official campaign not as a crackdown but as an effort to raise awareness of the dangers of money laundering.

A total of 285 transactions have been sent to the Public Prosecution since 2002, with 20 of those reaching court, said Saeed Abullah Al Hamiz, a senior executive director of banking supervision at the central bank.

“There are still things that need to be improved,” Koster said. “We see no reason to be complacent.” 


With inputs from agencies