DUBAI, 1st August, 2023 (WAM) -- The Dubai Financial Services Authority (DFSA) has imposed a fine of US$ 3,022,500 (AED 11,100,131) on Mirabaud (Middle East) Limited (Mirabaud) bank for having inadequate anti-money laundering (AML) systems and controls between June 2018 and October 2021.
The fine includes disgorgement of US$975,000 (AED 3,580,687), which represents Mirabaud’s economic benefit from its contraventions in the form of fees and commission. Mirabaud agreed to settle the matter, reducing the fine from US$ 3,900,000 (AED 14,322,750).
The DFSA found that weaknesses in Mirabaud’s AML systems and controls meant that it processed transactions, for a group of nine interconnected client accounts managed by the same Relationship Manager, which raised a number of red flags related to suspicions of money laundering. The activities of the relevant customer accounts exhibited characteristics similar to those commonly seen in the layering phase of a money laundering operation.
The DFSA did not make a finding that any of these transactions were in fact money laundering. However, the activity highlighted significant weaknesses in Mirabaud’s systems and controls and presented key indicators of potential money laundering that Mirabaud should have recognised and acted upon.
Although Mirabaud put in place AML policies and procedures, they were ineffective. When processing transactions for this group of interconnected customers, Mirabaud failed to consider information it held about them, including that which had been obtained as part of the bank’s customer due diligence.
Ian Johnston, Chief Executive of the DFSA, said, "The DFSA is committed to promoting a robust AML control framework across the firms that it regulates.
"The level of penalty imposed on Mirabaud reflects the importance of AML compliance in maintaining confidence in the integrity of the DIFC.”