In a sweeping continuation of its aggressive regulatory stance, the Central Bank of the UAE (CBUAE) has intensified enforcement actions against banks, insurers, and exchange houses that fall short of the country’s stringent compliance standards. As an affirmation to the country’s regulatory maturity and international cooperation, the United Arab Emirates (UAE) was officially removed from the FATF grey list in February 2024, and from the European Union (EU) grey list in July 2025. Read More on these recognitions: After FATF Grey List, UAE Clears EU Grey List too
This July alone, it fined a domestic bank AED 3 million, sanctioned a foreign bank branch with AED 5.9 million in penalties, and suspended the motor insurance operations of a foreign insurer’s UAE branch for solvency breaches—while compelling the company to honour all pre-existing policies.
Just weeks earlier in June 2025, the CBUAE had barred a local bank’s Islamic window from onboarding new clients for six months due to governance failures. In May, five insurance brokers were hit with administrative and financial sanctions for AML/CTF violations—two were fined and three received formal warnings.
Back in March, the regulator levied stiff financial penalties on five banks and two insurance companies for failing to comply with international tax transparency standards under CRS and FATCA. And on July 7, the CBUAE imposed AED 4.1 million in administrative fines on three licensed exchange houses for AML/CFT non-compliance.
These latest penalties form part of a broader crackdown that has already seen over AED 339 million in fines handed out earlier this year—signalling the UAE’s unwavering commitment to a clean, compliant, and investor-trusted financial system. Read more on the penalties: AML Enforcement rapid-fire series in the UAE Exceeds AED 339 million penalties
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Why were the exchange houses fined?
According to the official CBUAE statement, the decision followed a comprehensive regulatory inspection that revealed:
- Weak internal controls
- Deficiencies in AML compliance frameworks
- Failure to adhere to risk-based customer due diligence
The Central Bank emphasized that such violations contradict the provisions of Federal Decree Law No. (20) of 2018 on AML/CFT and Cabinet Decision No. (10) of 2019 regarding its implementing regulations.
“The Central Bank, through its supervisory and regulatory mandates, works to ensure that all licensed financial institutions operate in line with UAE laws and regulations,” the statement noted.
Persistent and escalating enforcement
The action reflects CBUAE’s resolve to ensure the financial sector remains resilient, compliant, and protected from illicit finance. Earlier this year, the regulator conducted widespread inspections and levied record fines across banks and exchange houses—culminating in more than AED 339 million in penalties by May 2025.
The WAM report also underscores the Central Bank’s alignment with international standards such as FATF and its role in maintaining the UAE’s global standing as a responsible financial hub.
Industry implications
The targeted penalties serve as a fresh warning for exchange houses, banks, and fintech operators to reinforce:
- AML policies and employee training
- Suspicious transaction monitoring and reporting systems
- Customer due diligence and record-keeping procedures
Public and investor confidence
The UAE continues to invest heavily in strengthening its financial governance framework. By proactively identifying and penalizing violators, the Central Bank enhances investor trust and positions the UAE as a transparent, well-regulated international financial center.
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Benoy Jacob is a journalist-turned-business consultant, currently serving as the Director of Client Relations at ATB Corporate in Abu Dhabi. With a keen eye for market trends and business strategy, he helps companies expand, build strategic partnerships, and optimize their operations in the UAE. Benoy brings a unique perspective on economic policies, trade ecosystems, and investment opportunities in Abu Dhabi and the wider MENA region.