(AML-CFT Decision Articles 27-30)

Financial institutions are obliged to undertake certain CDD measures concerning wire transfers, as laid out in detail in the above-referenced articles of the AML-CFT Decision. In particular, these measures relate to the identification of the originators and beneficiaries; the maintenance of information in regard to the same; and the implementation of risk-based policies and procedures for handling the disposition of wire transfers and for taking appropriate follow-up action.

The purpose of these measures are to ensure that information on the originator and the beneficiary shall accompany (meaning sent at the same time but not necessarily in the same message) cross-border wire transfers at all stages of its execution in case the amount of the transfer of funds equals or exceeds AED 3,500 or equivalent in any other currency.

The FI of the originator (or payer) shall ensure that the transfer of funds is accompanied by the information on the originator and beneficiary (or payee) as follows:

Information on the originator:

Information on the beneficiary:

In case of cross-border wire transfers of less than AED 3,500 or equivalent it not required to verify the accuracy of the above-mentioned information, unless there are suspicions of ML or TF.

Also for domestic wire transfers, the FI of the originator shall ensure that above-mentioned information is included, unless this information can be made available to the FI of the and by other means.

The FI of the originator shall not execute the transfer if it has not verified the identity of the originator. The FI of the beneficiary shall not credit the beneficiary’s account or make the funds available for the beneficiary if it has not conducted verification of the beneficiary’s identity.

The FI of the beneficiary is required to implement effective procedures to identify the received transfers that lack information about the originator and the beneficiary, in real-time or as part of the post-event monitoring process. This will include risk-based procedures whether transactions that lack the required information are to be executed, returned, suspended or transferred to the account of the beneficiary, as well as procedures related to the follow-up actions regarding these transfers, including to request the information on the originator and the beneficiary.

An intermediary FI ensures that all information about the originator and the beneficiary accompanied with the cross-border wire transfer is transferred to the beneficiary or other intermediary provider. Should there be technical limitations that prevent the required information accompanying a cross-border wire transfer from remaining with a related domestic wire transfer, the intermediary FI shall keep a record of all the information received from the ordering FI or another cross-border intermediary FI.

The intermediary FI is required to implement effective risk-based procedures to identify the received transfers that lack information about the originator and the beneficiary, in real-time or as part of the post-event monitoring process.

The procedures can include defining and documenting specific AML/CFT system parameters (such as transaction value, aggregate transaction amounts at the customer level, customer risk classification, or others) which would trigger an exception to straight-through processing and require manual review and intervention. This will also include procedures for determining when to execute, reject, or suspend a wire transfer lacking required information and the appropriate follow-up action.

Where an FI repeatedly fails to provide the required information on the originator and the beneficiary, the beneficiary’s or intermediary FI, taking into consideration the risks and frequency of the violations by the FI of the originator, shall take steps, which may initially include the issuing of warnings and setting deadlines. These steps can ultimately consist of rejecting any future transactions from the FI or restricting or terminating its business relationship with that FI.

Similar requirements apply to VASPs. Originating VASPs obtain and hold required and accurate originator information and required beneficiary information on virtual asset transfers, submit the above information to the beneficiary VASP or FI (if any) immediately and securely. Beneficiary VASPs obtain and hold required originator information and required and accurate beneficiary information on virtual asset transfers. For the purposes of applying the wire transfer requirements to VASPs, all virtual asset transfers are to be treated as cross-border.

In addition to the above, as part of their ongoing account monitoring procedures, FIs should also review the purpose of wire transfers, as indicated in their description fields, for potential red-flag indicators (see Section 7.2, Identification of Suspicious Transactions).