The U.A.E. is considered to have made efforts against money-laundering but that more needed to be done.
The Financial Action Task Force put the United Arab Emirates on a “gray list” on March 4 for concerns about its efforts to stop criminals and militants from using the country to hide wealth.
Based in Paris, the FATF is an anti money-laundering body. It put the U.A.E. on the list of 23 countries which include other Middle-East countries like Jordan, Syria and Yemen.
The U.A.E., home to Dubai and Abu Dhabi, carefully tries to render a business-friendly image and is home to economic free zones and real estate ventures. Being included in the list could harm its image of a safe and nice place to live and work in. Moreover, ratings agencies and other financial institutions also consider such a listing as a risk, which can affect interest rates for loans.
The U.S. State Department recently described “bulk cash smuggling” as “a significant problem” in the Emirates. War profiteers, terror financiers and drug traffickers would use its flourishing real estate market as a safe haven for their money according to a 2018 report from the Center for Advanced Defense Studies.
The FATF however acknowledged “significant progress” even though more needed to be done.
Emirati officials on Twitter wanted to reassure investors that the U.A.E. remained a safe, regulated place to do business and would address the international concerns. Senior Emirati diplomat Anwar Gargash stressed on Twitter that the country had “made significant progress in combating financial crime”.
“The U.A.E. will continue its ongoing efforts to identify, disrupt and punish criminals and illicit financial networks in line with FATF’s findings and the U.A.E.’s National Action Plan, as well as through close coordination with our international partners,” the Emirates’ Executive Office of Anti-Money Laundering and Countering the Financing of Terrorism said.
Since the publication of the list, the U.A.E. has also established a corporate registry and signed extradition agreements with other nations