AML/CFT Policy

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 AML/CFT Policy

1. Policy Statement

Al Bader Exchange is fully committed to combating Money Laundering (ML), Terrorist Financing (TF), and the financing of illegal organisations, in compliance with the laws and regulations of the United Arab Emirates (UAE) and international standards. Our objective is to safeguard our business, customers, employees, and the financial system by ensuring full adherence to AML/CFT obligations and fostering a culture of integrity, transparency, and accountability.

2. Regulatory Framework

Al Bader Exchange operates under the regulatory oversight of the Central Bank of the UAE and adheres to the following legislation and international frameworks:

  • Federal Decree Law No. (20) of 2018 on AML/CFT and Financing of Illegal Organisations
  • Cabinet Decision No. (10) of 2019 concerning the Executive Regulation of AML Law
  • Federal Law No. (4) of 2002 and amendments
  • Federal Law No. (1) of 2004 on Combating Terrorism
  • UAE Targeted Financial Sanctions Regulations
  • FATF Recommendations
  • MENAFATF Guidelines
  • Basel Principles
  • USA PATRIOT Act, Bank Secrecy Act
  • OFAC, UNSC, EU, UK HMT sanctions list

3. AML/CFT Governance Structure

3.1. Compliance Officer Designation
  • A senior Compliance Officer (CO) is appointed and approved by the Central Bank of the UAE.
  • An Alternate Compliance Officer (ACO) supports in the absence of the CO or as needed.
  • Both officers report directly to the Board of Directors and have independent authority and access to all company operations.
3.2. The Owner and Senior Management Responsibilities
  • The owner ensures AML/CFT strategy and resources are adequate.
  • Senior Management enforces day-to-day compliance and oversees performance of the AML/CFT program.

4. Risk-Based Approach (RBA)

Al Bader Exchange adopts an RBA in identifying and managing AML/CFT risks. Customer and transaction risks are evaluated based on:

  • Customer type and occupation
  • Source and origin of funds
  • Product or service used
  • Geographical risk
  • Delivery channels

Higher-risk scenarios are subject to Enhanced Due Diligence (EDD).

5. Know Your Customer (KYC) & Customer Due Diligence (CDD)

5.1. Customer Onboarding
  • Identity of all customers must be verified using valid, original documents.
  • Copies of ID documents are retained, and authenticity is verified.
  • Ongoing CDD is applied throughout the customer relationship.
5.2. Enhanced Due Diligence (EDD)
  • Applied to high-risk customers, politically exposed persons (PEPs), and transactions involving high-risk jurisdictions.
  • Requires detailed source of funds and supporting documentation.
  • Additional checks are conducted using screening tools like KYC6 and Trax.
5.3. KYCC (Know Your Customer’s Customer)
  • Where applicable, indirect beneficiaries and the ownership structure of corporate clients are verified.

6. Transaction Monitoring

  • Al Bader Exchange uses automated monitoring tools for real-time and post-transactional analysis.
  • The system identifies unusual patterns, large transactions, and rapid movement of funds inconsistent with customer profiles.
  • Frontline staff act as the first line of defence; the Compliance Department conducts deeper analysis.

7. Sanctions Screening

  • All customers, counterparties, and transactions are screened against:
    • UAE Local List
    • UN Security Council (UNSC)
    • OFAC – USA
    • EU Sanctions
    • HM Treasury – UK
  • Screening is performed at onboarding and regularly thereafter.
  • Tools like KYC-6 and real-time API integrations are used for continuous screening.

8. Reporting Suspicious Transactions

  • Employees must escalate any unusual or suspicious transactions to the CO or ACO without alerting the customer.
  • The CO/ACO will review and, if warranted, file a Suspicious Transaction Report (STR) with the Financial Intelligence Unit (FIU) of the Central Bank.

9. Record-Keeping & Confidentiality

  • All customer, transactional, and compliance records are retained for a minimum of five years, in line with Central Bank regulations.
  • Al Bader Exchange ensures the strict confidentiality of customer data and only discloses information to authorised regulatory or law enforcement agencies.

10. Employee Training

  • AML/CFT training is mandatory for all staff, including senior management and Board members.
  • New employees receive training within the first 30 days.
  • Annual refresher training includes:
    • ML/TF typologies and trends
    • Risk indicators and red flags
    • KYC/EDD practices
    • Legal obligations and reporting procedures

11. Independent Review & Audit

  • Internal Audit and external independent audit firms conduct regular reviews of the AML/CFT framework.
  • The effectiveness of policies, systems, and controls is assessed periodically.
  • Findings are reported to the Board for corrective actions.

12. Cooperation with Authorities

  • Al Bader Exchange cooperates fully with all lawful requests from the Central Bank of the UAE, the FIU, and law enforcement bodies.
  • The Compliance Department ensures prompt and accurate responses to regulatory inquiries.

13. Conclusion

Al Bader Exchange’s AML/CFT policy reflects its firm commitment to operate with integrity, maintain transparency, and prevent the misuse of its services for illicit purposes. The policy is reviewed and updated regularly to reflect regulatory changes, emerging threats, and advancements in industry best practices.