UAE Central Bank Orders Probe Into Banque Misr Branches After US Money Laundering Warning

UAE Central bank says it is studying options on the Egyptian lender's status in the UAE after US authorities proposed a special measure over money laundering concerns

The Central Bank of the UAE (CBUAE) has ordered a special and urgent examination of Banque Misr's branches in the country, a day after US authorities issued a statement proposing a special measure against the Egyptian lender over concerns it poses a primary money laundering risk.

In a statement, the CBUAE said it had reviewed the notice issued by US authorities regarding the proposed action against Banque Misr's UAE branches, which the US had identified as a financial institution operating outside the United States of primary money laundering concern.

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The regulator stressed that Banque Misr's UAE branches remain subject to the laws and regulations in force in the country, and reiterated that banks licensed in the UAE are expected not to expose the country's financial system to reputational risks. It added that lenders must respect the laws and regulations of the countries whose financial institutions they use to conduct transactions, and must not misuse the UAE's advanced financial infrastructure.

The CBUAE said it periodically examines anti-money laundering and counter-terrorism financing (AML/CFT) procedures at banks operating in the UAE, and verifies the effectiveness of sanctions screening and other compliance systems. Banks are required to strengthen these procedures in line with applicable laws and regulations, it said.

As part of its response, the central bank has decided to carry out a special and urgent examination of Banque Misr's UAE branches, including a forensic, in-depth lookback covering the period referenced in the US statement. The review will focus specifically on banking transactions linked to the companies named in the US authorities' statement.

The CBUAE said it is currently studying the options available regarding the bank's status in the UAE, should a decision be taken to impose the special measure following the completion of procedures under US law. Any decision will be made in due course, the regulator said, taking into account the bank's obligations towards its customers in the UAE.

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