DUBAI Court Circulars

Circular Concerning Procedures For Anti-Money Laundering (2004), Federal Laws

In order to prevent brokers from taking advantage -thorough the competitive environment fo the securities markets in the country - to launder funds by ignoring the source of funds of some customers,
And in accordance with the provisions of Union Law No. (4) of 2002, regarding the criminalization of moey laundering, the Board of Directors of Securities and Commodities Authority has decided the following in the this regard: 

Article 1 Definition of money laundering Money laundering refers to purchase of securities with funds, whose source in not identified accurately, or emanating from an unknown or disguised source, so that it appears to have originated from a legitimate source, where in fact it has not.
Article 2 Scope of application of procedures These procedures apply to the securities markets licensed in the country, and to brokers, working at them.
Article 3 Investros accounts and required documents Financial markets and/or brokers, while opening any account, shall undertake to ensure obtaining all information and necessary documents which include the following: a- Full names(s) of customer(s) and his/their address(es). b- Trade licence(s) c- Place of work. d- Checking the original passport and keeping a copy thereof initialed by the relevant officer.
Article 4 Settlement procedures All settlement transactions between the investor, the broker and the financial markets, whose cash value equal to or exceed forty thousand dirhams (AED 40.000) must be recorded per the attached form No. (1).
Article 5 1- Reporting unusual transactions Financial markets and/o brokers working at them shall undertake to report to the examination and follow -up section at the Securities and Commodities Authority any unusual transaction, per a special form. The party which receives STR's must analyze and check these reports prior to sending them to AMLSCU at the Central Bank to take the necessary action in their reard. 2- Each financial market shall undertake to appoint an officer responsible for compliance and for contacting the Securities and Commodities Authority to report any suspicious money laundering cases, and to maintain records in their regard. 3- The financial market which fails to report unusual or suspicious cases, as previously mentioned, shall be liable to penalties.
Article 6 Staff training The compliance officer in each financial market shall be responsible for a training programme for the staff involved in receiving cash, overseeing accounts and preparing STRs.
Article 7 Record and File keeping system Each financial market shall establish a file keeping system, obliging representatives of brokers, who work at it, to keep all corresppondence, contracts and transactions, they carry out, in special files. These files shall be kept and made available for the Authority's examiners and law enforcement authorities of Union Law No. (4) of 2002, regarding criminalization of money laundering, for a minimum period of five (5) years.
Article 8 Interpreting the provisions of the circular The Chairman of the Board of Directors of the Securities and Commodities Authority shall be teh sole and only interpreter of the provisions of this circular.
Article 9 Implementation procedures These procedures hall come into force from 18-2-2004. This entails making arrangements and taking the necesary steps from now.
Article 10 Publication of the Circular The circular shall be notified to the concerned to implement its provisions and shall be published in the offical Gazette in both Arabic and English. Any circulars, notices, decisions or directives that are in conflict with the provisions of theis circular shall become cancelled.
Article 11 The attached forms are an integral part of this circular.