UAE Ministry of Economy Strengthens Gold Sector Governance with Due Diligence Policy
The UAE Ministry of Economy has reaffirmed its commitment to enhancing governance in the gold sector through the rigorous implementation of the due diligence policy for responsible sourcing. This initiative aligns with the country's ongoing efforts to strengthen its anti-money laundering (AML) framework in compliance with international best practices, including those set by the Organization for Economic Co-operation and Development (OECD).
The Ministry highlighted that the due diligence regulations form a crucial part of its supervisory role in the precious metals and gemstones trade sector. These regulations ensure that businesses operating in the sector adhere to the highest levels of compliance with the UAE's AML and Countering the Financing of Terrorism (CFT) legislation.
In a recent move, the Ministry conducted a series of field inspections targeting activities related to the trade of precious metals and gemstones. As a result, the operations of 32 gold refineries, representing 5% of the UAE's gold sector, were temporarily suspended for three months starting July 24, 2024. These suspensions, set to last until October 24, 2024, were imposed after the refineries were found to have committed a total of 256 violations. Key offenses included the failure to adopt necessary risk identification measures, not reporting suspicious transactions to the Financial Intelligence Unit (FIU), and failing to verify customer databases against terrorism lists.
H.E. Abdullah Ahmed Al Saleh, Undersecretary of the Ministry of Economy, emphasized the UAE's unwavering commitment to building a robust legislative and regulatory system to combat money laundering and ensure responsible gold sourcing. "The Ministry remains dedicated to strengthening its oversight of the Designated Non-Financial Businesses and Professions (DNFBP) sectors in the UAE, which encompass precious metals and gemstones, real estate agents, company service providers, and auditors. We are intensifying our inspection efforts to guarantee full compliance with the nation's AML/CFT laws," said Al Saleh.
The Due Diligence Regulations for Responsible Sourcing of Gold were first introduced by the Ministry in September 2022 and became effective in January 2023. This regulatory framework is part of a broader strategy aimed at fortifying the UAE's AML and CFT measures within the critical economic sector of gemstones and precious metals trading.
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