Abu Dhabi Authority Fines Aarna Capital Dh1.85 Million for AML Breaches

Abu Dhabi authority fines Aarna Capital Dh1.85 million for breaching anti-money laundering regulations

The Financial Services Regulatory Authority (FSRA) of Abu Dhabi Global Market (ADGM) has imposed a fine of $504,000 (Dh1,850,940) on Aarna Capital Limited (ACL) for failing to uphold adequate anti-money laundering (AML) systems and controls over a six-year period, from June 8, 2017, to January 13, 2023.

The FSRA’s investigation uncovered significant breaches in ACL's compliance with the anti-money laundering and sanctions rules and guidance set forth by the FSRA. A detailed review of selected customer relationships revealed that ACL's policies, procedures, and systems were insufficient to meet certain requirements outlined in the AML rulebook.

Key violations identified include:

• Failure to maintain adequate records of customer due diligence (CDD) conducted on several clients.

• Insufficient assessment of CDD information based on the risk profile of customers.

• Inadequate monitoring of deposit and withdrawal transactions to ensure alignment with customers' profiles.

• Lack of effective systems to detect and monitor suspicious activities or transactions potentially linked to financial crimes.

Despite these breaches, the FSRA’s investigation confirmed no actual instances of money laundering arising from ACL's system deficiencies.

Cooperation and settlement

ACL and its senior management fully cooperated with the FSRA's inquiry and have since taken corrective measures to address the identified shortcomings. The firm agreed not to contest the FSRA's findings and settled at the earliest opportunity, qualifying for a 20% reduction in the financial penalty. Without this discount, the fine would have been $630,000 (Dh2,313,675).

FSRA commitment to AML compliance

FSRA remains committed to advancing national efforts to prevent financial crimes. All regulated firms within the ADGM must maintain robust anti-money laundering systems to mitigate risks associated with their activities and customers. The FSRA will continue to enforce strict compliance with its regulations.”

ACL’s case underscores the FSRA’s vigilance in ensuring adherence to AML regulations and protecting the integrity of the financial system.

 

 

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