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Sunday, May 17, 2009

UAE takes news measures against money laundering

DUBAI, May 14 (Reuters) - The United Arab Emirates said on Thursday it had approved new measures to combat money laundering and financing of militant groups.Since the Sept. 11 attacks, the United States has leaned hard on Gulf countries, among others, to tighten controls in their financial systems to choke off terrorist finance. One of the 19 attackers was from the UAE.Free zones and economic departments in the UAE, a federation of seven semi-autonomous "emirates", have been asked to make sure their regulatory measures conform with international moves to combat the phenomenon, the state news agency WAM said."The measures to tackle the menaces include issuing precautionary warnings to enlighten the people about the practice of certain unlicensed individuals and firms engaged in promoting finance management and investment portfolios," Thursday's statement said. The measures were approved by the National Anti-Money Laundering Committee, a body set up to combat money laundering, in a meeting chaired by central bank governor Nasser al-Suwaidy."The committee will send circulars to all banks and financial institutions operating in the country to adhere strictly to the law and regulations...," it said. "The banks will also be asked to recruit nationals as special officers to regulate activities aimed at countering the menaces of money laundering and terrorism financing." UAE nationals form only around 15 percent of the country's 4.5 million population, a mix of Asian, African and European blue and white collar labour. Indians and Pakistanis are thought to form the largest national groups in the country. In 2007 the UAE froze 17 bank accounts totalling $1.3 million because of suspected links to terrorism financing. The UAE central bank said then it had frozen 259 accounts for suspected money laundering and other fraudulent activities, and referred them to the local courts. Since 2003, the UAE has also required informal money transfer outlets, known as hawala brokers, to register with the central bank. It has approved 246 hawala brokers and is processing the applications of 70 more, Awadi said.Hawala brokers are often used to remit money to remote areas such as rural Pakistan or Afghanistan, where the banking system is least developed. Brokers accept funds in one country and promise to pay a beneficiary in another for a fee that is smaller than at a bank. (Writing by Andrew Hammond; editing by Philippa Fletcher)

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