Highlights
- DFSA (Dubai Financial Services Authority) fines Mirabaud (Middle East) Limited $3.02 million (Dh11.1 million) for lacking effective anti-money laundering (AML) systems and controls.
- Weaknesses in Mirabaud’s AML processes led to the processing of transactions raising suspicions of potential money laundering.
- Mirabaud failed to identify and report suspicious transactions and neglected customer due diligence information.
- The fine includes disgorgement of $975,000 (Dh3.58 million), representing the bank’s economic benefit from its contraventions.
- The bank’s AML policies and procedures were found to be ineffective in mitigating risks of money laundering.
- Clients’ claims of financial market experience were unsubstantiated, raising doubts about their credibility.
- The bank’s responsible relationship manager and senior executives during the failings have since left the organization.
- DFSA stresses the importance of AML compliance in maintaining the integrity of the Dubai International Financial Centre (DIFC).
Dubai Financial Services Authority (DFSA) has imposed a fine of $3.02 million (Dh11.1 million) on Mirabaud (Middle East) Limited, a bank, for having inadequate anti-money laundering (AML) systems and controls between June 2018 and October 2021. The fine also includes disgorgement of $975,000 (Dh3.58 million), representing Mirabaud’s economic benefit from its contraventions in the form of fees and commission.
DFSA
The DFSA found weaknesses in Mirabaud’s AML systems and controls, particularly related to transactions processed for a group of nine interconnected client accounts managed by the same relationship manager. These transactions raised suspicions of potential money laundering, including activities resembling the layering phase of a money laundering operation.
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Despite having AML policies and procedures in place, they proved ineffective, and Mirabaud failed to consider crucial information about these customers, leading to the processing of a significant volume of transactions that deviated from the expected activity and were inconsistent with the profile of the clients. Mirabaud also failed to identify and report suspicious transactions, neglecting its compliance department’s concerns and customer due diligence information.
The DFSA also identified clients who claimed to have experience in financial markets without suitable evidence, raising doubts about their credibility. The responsible relationship manager and senior executives involved during these failings have left Mirabaud.
Ian Johnston, Chief Executive of the DFSA, emphasized the importance of AML compliance in maintaining confidence in the integrity of the Dubai International Financial Centre (DIFC). The settlement of the matter reduced the fine from the initial $3.9 million (Dh14.322 million) to $3.02 million.
