What must a UAE accountant do when customer due diligence cannot be completed?
The firm must not establish or continue the business relationship, and must not execute the transaction. Where a client will not provide identification documents, will not identify the beneficial owner, or supplies information that cannot be verified, the correct response is to decline or terminate rather than to proceed with a note on file.
The obligation does not end with refusal. The firm must then consider whether the failure itself gives rise to suspicion and, if so, file a Suspicious Transaction Report with the Financial Intelligence Unit through goAML. A client who abandons an engagement as soon as beneficial ownership questions are asked is a recognised red flag, and the fact that no fee was earned and no work was performed does not remove the reporting duty. Reporting is required regardless of the value involved.
Firms should document the decision chain: what was requested, what was received, why verification failed, who decided to exit, and whether an STR was filed or a reasoned decision taken not to file. That record is what a supervisor will test, and it should be retained for at least five years.
Legal Reference (UAE):
· Cabinet Resolution No. 134 of 2025, Article 14 — prohibition on establishing or continuing a relationship where CDD cannot be applied, with consideration of filing an STR
· Federal Decree-Law No. 10 of 2025, Article 18 — duty to report suspicion regardless of transaction value
For more details, consult the full text of Cabinet Resolution No. 134 of 2025 or seek guidance from your AML compliance officer.