This backdrop makes the practical message for the year ahead clear: heightened and significant enforcement is expected, with the regulator armed with more tools and wider-ranging and more punitive penalties at its disposal.
Businesses in the UAE should assess whether their current compliance frameworks are sufficiently robust to withstand the lowered evidentiary standards for money laundering offenses and whether they sufficiently protect managers from potential personal liability.
New AML law much stricter with enhanced personal liability for managers
The UAE published its national strategy for anti-money laundering (AML), counter-terrorist financing (CTF), and proliferation financing (PF) for the period 2024–2027 (National Strategy) in September 2024. The implementation of the National Strategy is a critical component in the development of the UAE’s AML/CTF/PF framework (AML framework) in the lead up to the mutual evaluation of the UAE by the Financial Action Task Force (FATF) in 2026.
The New AML Law was enacted in October 2025, bringing significant reform of the UAE’s AML framework. It broadens the scope and coverage of the UAE’s AML framework, including:
- new offenses relating to the prevention of proliferation financing, e.g., the sale of dual technologies for weapons manufacture
- terrorist and proliferation financing and tax evasion are now specifically included within the definition of a “predicate offense” for money laundering
- new criminal personal liability for managers of legal entities where offenses are committed by the entity, the manager knew of the offense, and it occurred due to a breach of their employment duties. Managers are liable for imprisonment and/or fines
- a new penalty of up to three months’ imprisonment and/or a fine of up to AED50,000 for those promoting, selling, or using privacy-enhancing virtual asset products and services that fully conceal user identity or hinder the ability of authorities to track transactions
A lowered threshold is now required to establish a money laundering, terrorist, or proliferation financing offense. Under the prior framework, “knowledge” that funds were derived from a predicate offense was required to establish the offense. The new framework lowers this threshold to “sufficient evidence or circumstantial evidence,” and knowledge can be inferred from the “factual and objective circumstances.”
As a practical measure, good contemporaneous record keeping is even more important so that businesses can easily have to hand the “factual circumstances” relevant to any financial crime allegation.
The Financial Intelligence Unit (FIU), the UAE’s financial crime regulator, has been granted new powers to (i) freeze funds suspected to be linked to financial crime held by financial institutions, designated non-financial businesses or professions (DNFBPs) (such as lawyers or real estate agents), or virtual asset service providers (VASPs) for 30 days and (ii) suspend transactions suspected to be linked to financial crime.
The New AML Law also introduces the power for UAE courts to enforce foreign orders related to the confiscation of criminal property, even where there is no UAE investigation.
New penalties have been introduced, and existing penalties increased, e.g.:
- Fines for money laundering, terrorist financing, and proliferation financing offenses can now reach up to twice the value of the criminal property (if that is greater than the maximum stated fine) if certain aggravating circumstances exist, e.g., if a person is able to facilitate a money laundering offense because of their professional duties.
- There is now no upper limit on the fine that can be applied for tipping off a person or entity which may be the subject of a suspicious activity report.
- There are increased financial penalties for legal entities, which now face fines of up to AED100 million where representatives commit offenses on their behalf.
- Where someone intentionally provides incorrect or misleading beneficial ownership information, they will be liable to imprisonment and/or a fine of up to AED20,000.
Strong enforcement in 2025
There are indicators that the UAE has implemented a strong enforcement agenda through 2025.
Central Bank enforcement
The most active financial crime enforcer in the UAE is the Central Bank which, in the first six months of 2025, reportedly issued significant financial penalties totaling AED339m, including:
- an AED200m fine on an unnamed exchange house for significant failures in its compliance with the AML laws. In the same matter an unnamed branch manager also faced a fine of AED500,000, and a prohibition on holding any position within any licensed financial institution in the UAE
- a fine of AED18.1m against two foreign banks for breaches of AML laws.
It has been reported that, in the first half of 2025, AML inspections by the Ministry of the Economy resulted in fines exceeding AED42m on DNFBPs. The majority of these fines were issued to traders in precious metals and real estate brokerages.
DFSA enforcement
In 2024, the Dubai Financial Services Authority (the financial regulator in Dubai’s common law jurisdiction) (DFSA) concluded 11 investigations, with 24 in the investigations stage. A broad range of misconduct was investigated, such as:
- unlicensed financial service activities, offering shares without an approved prospectus and falsely claiming to be authorized by the DFSA;
- systems and controls failures, including AML systems and controls, and controls for the prevention of market manipulation;
- misleading investors, potential investors, and the general public – a DFSA Authorized Firm was alleged to have advised firms to invest in a Ponzi scheme run by a related company; and
- providing false and misleading information to the DFSA.
FSRA enforcement
Furthermore, in 2024 Abu Dhabi’s Financial Services Regulatory Authority (the financial regulator in Abu Dhabi’s common law jurisdiction) concluded three investigations and had seven within the investigations stage, reflecting the increase in regulatory activity when compared to 2025. A total of USD782,666 was issued in financial penalties, with investigations relating to AML, governance, and disclosure issues.
Impact of strengthened whistleblowing regime
Since May 31, 2025, regulated entities have been required to comply with the Abu Dhabi Global Market’s Whistleblower Protection Regulations 2024 (the ADGM Regulations). This includes establishing sufficient whistleblowing systems and controls appropriate to the nature of the business. The ADGM has published supplementary guidance on the ADGM Regulations. We saw many UAE businesses assess and implement systems and controls in response to the ADGM Regulations, and we expect these regulations to be an important compliance control in the year ahead as they are implemented and become familiar to employees.
Enforcement in 2026: Metal traders, terrorist financing, and fraud
UAE regulators have published a significant volume of materials to assist the UAE’s business community to understand the regulatory environment and the risks to which it is exposed. This trend continued in 2025, with these publications acting as a helpful indication of possible enforcement priorities for the year ahead. The FIU:
- published detailed guidance on how to spot when precious metals and stones are being used to commit a money laundering offense. This follows significant enforcement activity by regulators against metals traders last year (32 gold refineries reportedly lost their license to operate) and in a context where the UAE has a significant trade in precious metals, including with high-risk jurisdictions
- published detailed guidance on identifying the risks and characteristics of terrorist financing
- identified in its 2024 annual report a material increase in fraud-related suspicious activity reports in the past year. The FIU also estimated that financial losses associated with these crimes were approximately AED1.2 billion for the period between 2021–2023, which indicates a significant operational risk to businesses in the UAE.
The FIU has invested in its own regulatory infrastructure, including its goAML portal (to which suspicious activity reports are made), and expects improvements in the quality of suspicious activity reports as the implementation of the UAE’s AML framework continues to progress. This will provide the FIU with better quality data and with it more effective enforcement.
A national campaign against cyber-enabled financial crimes
Cyber-related financial crime is accelerating globally. This trend has been seen in the UAE, where fintech and virtual asset activities are expanding significantly. While this growth is encouraging for the UAE’s digital economy, fintech, including crypto, brings new and significant financial crime risks. The UAE government has published research which illustrates these new risks. For example, this research identified that:
- The UAE has seen a rise in cryptocurrency investment fraud schemes, with approximately USD80,000 stolen on average from each victim in the UAE in 2025—which was reported to be the highest figure identified from benchmarking.
- There was an increase in the use of pre‑built “Fraud Service” tools and AI‑powered phishing toolkits, with a significant proportion of UAE residents reporting that they believed they had encountered an AI‑driven scam in the past 12 months.
Given these findings and the fact that the UAE’s fintech sector is rapidly growing, we expect that UAE regulators will be particularly focused in the year ahead on crime arising from emerging technologies. Further, as mentioned above, the UAE’s legislative framework has seen amendments which are directed at better facilitating the regulation of emerging technologies such as crypto and other virtual assets.
Key challenges for 2026 and practical next steps
The UAE has previously been perceived by the FATF to have taken insufficient steps to implement its financial crime framework. Significant progress has now been made. Businesses should expect this to continue in 2026, particularly with the UAE’s mutual FATF evaluation occurring.
This is also in a context in which the evidentiary standard to establish a conviction for financial crime offenses has been lowered and managers are now subject to personal liability, including fines and imprisonment.
In addition, the FIU has new significant powers to freeze assets and suspend transactions suspected to relate to financial crime (noting that one of the priorities in the National Strategy is to “use confiscation measures more frequently and effectively”).
It would be prudent for UAE businesses to take steps this year to understand and, if necessary, reduce or manage the financial crime risks to which they are exposed. These steps could include reviewing or undertaking a financial crime risk assessment, reviewing systems and controls, and refreshing employee training in areas of identified risk.
Quotes
- “Praised as ‘one of the best practices in the Middle East’…” LEGAL 500 2025 UAE (Dispute Resolution)
- “The team is a respected presence in the DIFC Courts, notably acting on financial services and white-collar crime cases.” CHAMBERS GLOBAL 2025 UAE (Dispute Resolution)
- “Yacine is highly respected and for good reason. He has been very effective in resolving seemingly intractable cross-border disputes with the highest levels of complexity.” CHAMBERS GLOBAL 2025 UAE (Dispute Resolution)
This article is part of the A&O Shearman Cross-border white-collar crime and investigations review 2026.
