What administrative penalties can a UAE supervisory authority impose for AML breaches?
The supervisory authority may impose a graduated set of administrative penalties on financial institutions, designated non-financial businesses and professions, virtual asset service providers and non-profit organisations under its supervision for any violation of the Decree-Law, the Executive Regulations or decisions issued under them. The list runs from a warning, to an administrative fine of not less than AED 10,000 and not exceeding AED 5,000,000 for each violation, to prohibiting the violator from engaging in the relevant sector for a period the authority determines.
It goes further where the failure is attributable to individuals or is systemic: restricting the powers of board members, executives, supervisory or managerial personnel or responsible owners, including appointing a temporary supervisor; suspending or requiring the replacement of responsible directors or executives; suspending or restricting the activity or profession; and revocation of the licence. The authority may also require periodic reports on remediation, impose an incremental fine where the same violation recurs within one year, and publish the penalties through the media. Because the fine is assessed per violation, a control failure repeated across a book of business is not treated as one breach.
Legal Reference (UAE):
· Federal Decree-Law No. 10 of 2025, Article 17(1), which lists the administrative penalties, including a fine of AED 10,000 to AED 5,000,000 for each violation and revocation of the licence.
· Federal Decree-Law No. 10 of 2025, Article 17(3), which permits an incremental fine where the same violation recurs within one year of the prior fine.
· Federal Decree-Law No. 10 of 2025, Article 17(4), which permits the supervisory authority to publish the administrative penalties it imposes.
Where the position is finely balanced, document your reasoning and raise it with your compliance officer.