Arabian Post Staff -Dubai
The regulator announced the penalty on Friday, 30 October, alongside separate fines against two senior executives and an order requiring the foreign lender to undertake a mandatory programme to correct the deficiencies identified by supervisors.
The bank’s chief executive officer was fined Dh500,000, while its head of compliance and money laundering reporting officer received a Dh300,000 penalty. The central bank said both officials had failed to discharge the responsibilities attached to their positions.
Together, the three financial penalties amount to Dh200.8 million. The regulator did not identify the institution or the executives in its announcement, nor did it specify the dates of the examinations or disclose how long the failures had persisted.
The enforcement action was taken under the federal decree law governing the Central Bank and the organisation of financial institutions and activities. The regulator said its examinations established repeated shortcomings across several areas of the branch’s control systems, rather than an isolated compliance breach.
The deficiencies covered measures intended to prevent money laundering and the financing of terrorism and illegal organisations, together with governance, compliance management and the institution’s sanctions framework. The announcement did not identify particular transactions, customers or sanctioned parties associated with the findings.
The central bank also directed the foreign bank to implement a mandatory remediation programme subject to independent validation. This requires the institution to address the supervisory findings and have its corrective measures assessed independently, rather than relying solely on its own evaluation.
A further requirement involves a fit-and-proper reassessment of the chief executive officer and chief compliance officer. Such assessments concern whether individuals remain suitable to perform senior regulated functions, including their competence, conduct and ability to meet supervisory expectations.
The regulator did not announce the removal or suspension of either executive. It also gave no timetable for completing the remediation programme or reassessments, and did not say whether additional enforcement measures could follow.
The distinction matters because the penalties imposed on the executives are confirmed financial sanctions, while the reassessments are separate supervisory requirements. The announcement provides no basis for assuming that either official has been disqualified from holding office.
The Dh200 million institutional fine is ten times the Dh20 million penalty imposed by the central bank on another foreign bank branch in June. That earlier action also concerned repeated shortcomings in anti-money laundering, counter-terrorism financing and sanctions controls.
The June enforcement decision included a Dh300,000 fine against the branch’s head of compliance and money laundering reporting officer. The October action additionally identifies failures in governance and compliance management and imposes a personal penalty on the chief executive.
The latest action follows the central bank’s continued use of financial sanctions and supervisory directives against licensed institutions. Its 2025 annual report recorded Dh214.5 million in financial sanctions across regulatory categories, including Dh200.5 million associated with anti-money laundering and counter-terrorism financing breaches.
Those annual figures cover a different reporting period and multiple enforcement decisions, rather than the institution penalised on Friday. They nevertheless provide a measure of the size of the new sanction within the regulator’s published enforcement record.
The central bank’s regulatory framework requires licensed financial institutions to maintain effective systems for identifying customers, assessing financial crime risks and complying with applicable restrictions. Responsibility for those systems extends beyond specialist compliance teams to senior management and authorised decision-makers.
The regulator has also issued guidance addressing customer due diligence, record keeping, correspondent banking and risks connected with trade-based money laundering and proliferation financing. These supervisory expectations form part of the broader compliance obligations facing banks operating in the Emirates.
The central bank said its supervisory and regulatory mandate was intended to ensure that banks, their authorised decision-makers and employees complied with UAE legislation and the standards established by the authority. It identified transparency and the integrity of the banking sector and financial system as the objectives of that oversight.
The statement did not disclose the foreign bank’s country of incorporation, the number of its UAE branches or the business lines examined. It also did not provide a public response from the institution or either executive to the penalties. No details were given about any appeal or challenge to the decision.
Also published on Medium.
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