European Supervisory Authorities Recommend Keeping UAE on Money Laundering Grey List
Specialists from the European supervisory authorities responsible for combating money laundering and terrorist financing have recommended keeping the United Arab Emirates (UAE) on the grey list of money laundering.
Recently, it was revealed that the United States and several European countries, led by Germany, were seeking to remove the UAE from the grey list of the Financial Action Task Force (FATF) for combating money laundering and terrorist financing. However, diplomatic sources confirmed that European supervisory authorities opposed any improvement in the UAE’s position regarding money laundering and recommended keeping sanctions on it.
The Financial Action Task Force (FATF), based in Paris, placed the UAE on its grey list in March 2022, citing serious deficiencies in the UAE’s measures against sanctions evasion, terrorist financing, and other crimes.
This classification, which placed Abu Dhabi just one step away from the terrifying “blacklist” of the Financial Action Task Force, dealt a major blow to the reputation of the Middle East’s leading financial center. It also threatened to weaken the country’s long-term credit rating, although that has not happened yet.
The long-term risk to the UAE’s status as a business hub is one of the reasons why financial officials there are striving to get rid of this classification as soon as possible, promising “strong measures.”
However, some members of the International Cooperation Review Group (ICRG), a committee of banking and financial crime experts tasked with monitoring progress in the UAE, recently complained that the country had exceeded its unfulfilled promises, expressing concerns about the reliability of the information provided by the UAE for their assessments.
All ongoing indicators confirm that the UAE remains a haven for illicit transactions and money laundering amid government shortcomings in combating them.
Politico reported that the UAE uses its influence with European countries and the United States to pressure the global anti-money laundering watchdog to grant the UAE’s financial system a certificate of money laundering-free status.
The newspaper highlighted that these pressures come despite ongoing indications that the UAE is still a haven for illicit transactions, according to European supervisory authorities and other informed sources.
Based in Paris, the Financial Action Task Force (FATF) placed the UAE on its grey list in March 2022, citing serious deficiencies in the UAE’s measures against sanctions evasion, terrorist financing, and other crimes.
This classification, which placed the UAE just one step away from the terrifying “blacklist” of the Financial Action Task Force, dealt a major blow to the reputation of the Middle East’s leading financial center. It also threatened to undermine the country’s long-term credit ratings, although that has not happened yet.
The long-term risk to the UAE’s status as a business hub is one of the reasons why financial officials there are committed to getting rid of this classification as soon as possible, promising “strong measures.”
However, some members of the International Cooperation Review Group (ICRG), a committee of banking and financial crime experts tasked with monitoring progress in the UAE, recently complained that the country had neglected its promises and failed to deliver results, expressing particular concerns about the reliability of the information provided by the UAE for their assessments.
To the surprise of critics, representatives from several European countries, including Germany, Italy, Greece, and the United States, refused to address concerns specific to the UAE, according to informed sources.
The assessment by the ICRG is of utmost importance as it provides the basis for the final decision issued by the plenary session of the Financial Action Task Force, a decision-making body composed of member states that meets three times a year, on whether a country should be removed from the grey list or not.
