AML & CFT in the UAE: An Overview
In October 2025, the UAE enacted Federal Decree-Law No. 10 of 2025 on Anti-Money Laundering, Countering the Financing of Terrorism, and Financing of Proliferation (“2025 AML Law”), superseding the earlier Federal Decree-Law No. 20 of 2018.
This update focuses on the commitment by the UAE related to international standards set by the Financial Action Task Force. It is more focused on fighting the virtual assets risk, tax-related crimes, and proliferation financing. Farahat and co is providing the AML services in Dubai, you can check the site.
This 2025 framework isn’t made only for banks or traditional financial institutions. But it is useful for non-financial businesses and professions, fintech firms, and other companies operating in the UAE.
Key Legal & Regulatory Provisions
Expanded Scope of Regulated Entities and Offences
- The 2025 law mainly focuses on proliferation financing. Added to that, it also looks for weapons proliferation, money laundering, terrorism financing, etc.
- Offences now cover tax-related crimes (direct and indirect tax evasion) when these serve as predicate offences to money laundering.
- Entities such as fintechs, trading firms, logistics providers, professional services firms, and particularly VASPs (Virtual Asset Service Providers) are now clearly regulated under the AML/CFT/PF regime.
Lower Evidentiary Threshold & Stronger Enforcement Powers
- Prosecutors no longer need proof of actual knowledge that funds stemmed from criminal activity. Under the new law, circumstantial evidence or “should have known” standards suffice to establish ML/TF/PF offences.
- Regulatory authorities like the Financial Intelligence Unit now have the power to suspend transactions for up to 10 working days and also freeze assets for up to 30 days. It can further be extended by the Attorney General.
- The cross-border operation, foreign confiscation order, and mutual legal assistance have been strengthened to help asset recovery and enforcement globally.
Increased Penalties and Corporate / Senior Management Liability
- Individuals who perform ML/TF/PF crimes will have to face 1 to 10 years’ imprisonment. It could also increase, looking at the situation of the crime.
- Corporate entities face fines ranging from AED 5 million up to AED 100 million, or an amount equal to the “criminal property” value — whichever is greater.
- The amount of fines has increased in recent times. If you fail to follow the rules, your company might be closed for PF or TF offences.
Compliance Requirements & Controls
Governance and Internal Control Obligations
- Companies need to hire a compliance officer called a Money Laundering Reporting Officer. He will be accountable for AML/CFT issues.
- Boards and senior management carry personal responsibility for compliance.
- Required internal controls include customer due diligence (CDD), know-your-customer (KYC) procedures, ongoing transaction monitoring, and effective record-keeping systems.
- All the entities must maintain records like STR/SAR along with the transaction log. It should be kept minimum of 10 years from the date of the transaction or the end of the business relationship.
Risk Assessment and Reporting
- The financial and non-financial entities must conduct a business-wide risk assessment that covers ML/TF/PF risk. In order to do the assessment, it is important to look for customer profiles, jurisdiction, transaction types, and delivery channels.
- Businesses must use the goAML system to file for Suspicious Transaction Reports and Suspicious Activity Reports.
Beneficial Ownership Transparency
- There should be clear transparency about the ultimate beneficial owners of corporate or legal structures. It helps you to prevent misuse for illegal operations
- Providing false or incorrect information about ownership is also a criminal offence now.
Special Measures for Virtual Assets and VASPs
- This law mainly focuses on Virtual Assets under regulatory oversight now. You will need to follow the compliance, report, and keep records as traditional financial institutions.
- There is a major restriction on anonymous virtual assets or beneficial ownership. It could result in criminal liability.
Strategic Importance & Practical Implications for Businesses
Why the 2025 Reform Matters
- The new rule shows that the UAE is focused on meeting the international standards. It wil be using FATF for evaluation which will meet international standards.
- As the scope of AML is increased, it is not only the banks or financial institutions that need to be careful. Everybody from non-financial firms, fintech companies, virtual asset service providers, etc, must be careful. This states that AML or CFT isn’t only a banking issue but a business rule to follow.
Risks of Non-Compliance
- Violations now carry significant corporate liability, including multi-million AED fines, dissolution or closure of corporate entities, and, in some cases, criminal charges for senior management.
- The improved investigative power and the lower evidentiary threshold make things important. A small failure to follow the rule may result in enforcement and fines.
- For businesses that deal in virtual assets, it is important to register as a VASP. If you fail to do so, it results in severe regulatory and legal risk.
What Businesses Should Do: Key Controls & Compliance Steps
- A proper gap analysis of the existing framework should be conducted in comparison to the 2025 AML law. Update policies to cover AML, CFT, and PF obligations.
- Appoint or confirm an MLRO, institute internal compliance governance, and ensure the board is informed about AML/CFT risk.
- The development and implementation of the CDD/KYC procedure is important. You will also need to verify UBO and maintain accurate records of customers for at least 10 years.
- Always implement the transaction monitoring and STR/SAR reporting processes
- If you deal in virtual assets, it is important to register as a VASP. Furthermore, you will also need to follow all the rules of VASP and stop dealing with anonymous assets
- There should be a timely risk assessment that covers ML, TF, and PF.
- All staff need to have AML/CFT training. Furthermore, the company should use an independent audit of the AML system for better functioning.
Conclusion
The 2025 UAE AML and CFT framework is made to strengthen the financial situation. It expands the regulatory scope, strengthens the enforcement power, and increases the stakes for non-compliance. Any company that operates in the UAE or is connected to the UAE business must follow compliance.
There is no compromise on compliance for anyone. Strong internal controls, transparent beneficial ownership data, diligent record keeping, and better risk management are key. As you follow the new law in the right way, it will not only keep your business risk-free but also create a trustworthy image in front of the people of the UAE.
