The Central Bank of the UAE has imposed a Dh200 million fine on a branch of a foreign bank operating in the country, citing repeated and serious breaches of anti-money laundering and counter-terrorism financing rules. The penalty is the largest handed to a bank in the UAE so far this year. an examination of the branch uncovered broader shortcomings beyond anti-money laundering controls, including weaknesses in corporate governance, compliance management and sanctions screening. The UAE Central Bank did not name the branch in its statement.
Two senior individuals at the branch were penalised separately. The branch's chief executive was fined Dh500,000, while the head of compliance and money laundering reporting officer was fined Dh300,000 for failing to ensure the branch met its regulatory obligations.
As part of the enforcement action, the Central Bank has ordered the branch to carry out a mandatory remediation programme under independent oversight, and to conduct a fresh "fit and proper" assessment of both the chief executive and the compliance chief before they can continue in their roles. The measures were issued under the Federal Decree-Law on the Central Bank and the Organisation of Financial Institutions and Activities.
The fine fits into a wider pattern of tougher supervision by the UAE Central Bank over the banking sector in recent years. The UAE has stepped up scrutiny of financial institutions as part of its effort to strengthen anti-money laundering compliance and meet international standards set by global watchdogs. Several banks and foreign branches have faced penalties over similar failings as the country works to maintain its removal from international grey lists tied to money laundering risk. Banking analysts say the size of this latest fine signals that regulators intend to keep pressure on lenders operating in the UAE to tighten internal controls, particularly around cross-border transactions that carry higher money laundering risk.