What is the role of AML consultants in devising the AML-Compliant Database for businesses to Check Against TFS in UAE?
In the UAE, compliance with AML-CFT law is by virtue of Federal Decree-Law No. 20 of 2018, Cabinet Decision No. 10 of 2019 and Cabinet Decision No. 74 of 2020. The regulators have been handing out hefty fines across the board. As of today, approximately 339 million AED have been collected in fines from exchange houses, banks, and insurance firms alike, indicating that no industry is above inspection.
That's where AML experts come in. These professionals assist your company in developing a robust TFS screening infrastructure, in accordance with UAE regulations and best practice globally. Their aim: to safeguard your business operations, maintain reputation, and make sure you are audit-ready.
A properly constructed, AML-regulatory-compliant database is the driving force behind this at scale. AML consultants assist you in constructing this driving force so that each client, counterparty and transaction gets filtered against the United Nations consolidated list and the UAE Local Terrorist List, wherein the verified match freezes and gets reported at the same time.
So, why is all of this necessary for your business? Let’s read ahead to find out.
Understanding Targeted Financial Sanctions
The financial system of the world is based on trust, and the best protection from the abuse of the terrorists is the application of Targeted Financial Sanctions (TFS). The UAE is under this responsibility by virtue of the compliance of the country with international best practices like those recommended by the Financial Action Task Force (FATF).
This is mostly done to ensure that companies and financial institutions understand and accordingly do not deal with any individuals, organizations, or entities that are on sanctions lists. These lists are also liable to changes - which means that firms or organisations relying on out-of-date or patchy data might suffer penalties or even enforcement action. A very thin rope to walk!
Requirements For A TFS-Ready AML Database
With UAE Federal Decree-Law No. 20 of 2018 and Cabinet Decision No. 10 of 2019, non-compliance with implementing asset freezes and notification to the Financial Intelligence Unit of transactions with sanctioned entities or individuals will cost you dearly.
Your front-line defence is an AML-compliant, TFS-ready database for:
- Conducting real-time screening against up-to-date sanctions lists (OFAC, UN, UAE-local).
- Storing the correct customer profile, Emirates ID, beneficial ownership, as well as history of transactions.
- Making escalation paths available so that any match will trigger required processes immediately and accordingly.
How to Make Your Database TFS-Ready with AML Consultants
- Design of Framework and Gap Analysis
Consultants start by examining your existing data structure and onboarding processes. If you're a commercial bank or an acorn DNFBP, they identify where compliant data capture needs to be strengthened so you'll be ready to gather the proper data from day one (IDs, ownership, source of funds).
- Sanctions List Integration
Consultants will enable you to link your database with real-time streams of UAE and global sanctions lists.
- Automation and Alert Handling
You will shift from manual screening to intelligent, automated flagging systems. AML experts use thresholds for managing false positives and design formal escalation paths so that only compliance teams take action when it is most critical.
- Operational Support and Training
No strong system exists without human know-how. AML consultants onboard your compliance officers for reading alerts, handling data updates, and filing Suspicious Transaction Reports (STRs) through goAML. They also ensure that you remain compliant with changing regulations.
Important Compliance Facts
- Data quality is paramount: The best technology breaks with soiled or incomplete client files. Clean, well-organized data is an investment made by having trained staff.
- Technology beats burnout: Adding machine learning, such as in graph-based alert sorting that can reduce false positives up to 80%, can dramatically improve productivity.
- Audit trail preparedness: Regulators may require high-level logs. Consultants ensure that every screening check, update, and alert action is logged for future auditing.
- Cross-border consistency: Global businesses see value in systems capable of complying with UAE requirements and global standards such as FATF guidelines. Double compliance has been given greater credibility.
Conclusion
It doesn't take a Herculean effort to build and sustain an AML-compliant, TFS-capable database. It's an active, working system that requires strategy, technology, and a good operating pace. When properly done, though, it keeps you out of regulatory trouble, enhances your compliance profile, and puts you in favour with partners and regulators.
But coming into compliance doesn't have to be a daunting task. AML consultants such as CDA merge technical expertise with regulatory intelligence to develop, deploy, and improve working systems behind the scenes so you can see clearly to the future: expanding your business with safety.
CDA: You Personalized AML Consultant in UAE
Business entities looking for AML consultants and requiring the assistance in preparation of AML compliance framework can approach the experts of CDA who have been providing AML related services to a vast clientele for over more than a decade. CDA has been known for its personalized services hence the team is always ready to meet the vast requirements of the clients. In order ensure the compliance with the AML laws and to avoid hefty fines connect with CDA experts today!
Mitesh Maithia
Tax Manager
Mitesh is a Tax Professional with expertise in direct, indirect, and international taxation, including transfer pricing, since 2018. Passionate about making complex tax matters simple, he shares insights to help businesses stay compliant and forward-looking.
