The global anti-money laundering organization says the federation is no longer subject to increased monitoring after a successful on-site inspection.
The wealth management boom in the Middle East can continue unimpeded, with a significant obstacle now being moved out of the way.
The United Arab Emirates (UAE) is no longer subject to increased monitoring by the Financial Action Task Force (FATF) following a three-day plenary meeting that ended last Friday.
Deficiencies Addressed
It said the federation had made «significant progress in addressing AML/CFT deficiencies» after a successful on-site visit.
That small step has significant implications. For many wealth managers, they can go ahead and retune their internal IT systems so that that clients no longer necessarily get default medium and high-risk ratings because of their location.
Booking Centers
That will also make it significantly easier for them to create or manage booking centers given that fewer clients are expected to have to go through the relatively arduous know-your-client processes a high-risk determination can entail at the point of onboarding and during annual reviews that are compulsory for that segment.
It will also ease matters operationally with other financial industry counterparties and regarding regulatory matters involving cross-booked client account relationships. Overall, the step significantly lessens the amount of scrutiny needed.
Boom Continued
It puts less pressure on costs while making it easier to focus on revenues while prospecting and onboarding new clients.
Over the long-term, it will help increase the pace and duration of the wealth management boom currently underway in the Middle East, a positive industry development that finews.asia has recently been discussing at length.
