UAE Fines and Shuts Down Malik Exchange

UAE's Crackdown on Money Laundering: Malik Exchange Penalized and License Revoked.

In the spirit of financial transparency and strict adherence to international regulations, the Central Bank of the United Arab Emirates has taken significant actions against money laundering and terrorist financing once more. The latest measure involves revoking the operating license of Malik Exchange, a currency exchange company, along with imposing a 2 million dirham fine. The move was justified as the company had repeatedly violated anti-money laundering laws and failed to comply with terrorist financing prevention requirements.

What Exactly Happened?

The Central Bank emphasized in its statement that Malik Exchange did not adhere to the anti-money laundering laws in force in the UAE (Anti-Money Laundering – AML) and the regulations aimed at preventing the financing of terrorism and illegal organizations (CFT). During the inspection process, the authority conducted detailed investigations which clearly revealed a series of violations.

As a consequence, the Central Bank has:

Imposed a 2 million dirham fine,

Revoked their license,

And erased the name of the currency exchanger from the official register.

These actions send a clear signal to all players in the financial sector: compliance with the law is not optional but a mandatory expectation.

Why is This Matter Important?

The UAE has taken decisive steps in recent years to ensure its financial system fully complies with international expectations. As part of this, significant reforms have been implemented in the banking, insurance, and currency exchange sectors.

The case of Malik Exchange is particularly significant because:

It is one of the first publicly revoked currency exchange licenses in the UAE under the anti-money laundering law,

The 2 million dirham fine is not merely symbolic – it carries serious financial consequences,

Being removed from the register means they cannot reapply for an operational license under the same name in the future.

This is Not the First Case

The Central Bank has made it clear that financial institutions and insurers are not above the law. Recently, actions have been taken against other organizations:

On August 18, 2025, YAS Takaful PJSC's license was suspended for non-compliance with insurance company regulations,

On July 11, the license of Al Khazna Insurance Company was suspended,

In March, the Central Bank imposed a fine of 2.62 million dirhams on two insurers and five banks as they did not meet tax compliance standards.

All of this indicates that the regulatory authority does not hesitate to apply severe consequences in cases of non-compliance.

Continuous Monitoring and Accountability

The Central Bank has clearly stated that all currency exchange companies, their owners, and employees are obliged to comply with the country's laws. Inspections are regular and not limited to the licensing period. The authority aims to prevent and screen for abuses within the financial system, with particular attention to the following areas:

Anti-Money Laundering Measures (AML),

Protection Against Terrorist Financing (CFT),

Compliance with International Sanctions,

Transparency and Client Identification Obligations (KYC).

What to Expect in the Future?

The current measure reinforces that the UAE is further tightening its financial supervisory practices. The goal is clear: to ensure that the country's financial system is reliable, transparent, and free from any illegal activities.

In the future, more frequent:

Unannounced inspections,

Detailed reviews of anti-money laundering reports,

Stricter evaluations of external audits and reports,

Those who do not meet these expectations will have to contend with severe fines, license suspensions, and even permanent exclusion from the market.

Summary

The case of Malik Exchange is not unique but part of a comprehensive series of regulatory tightenings aimed at thoroughly cleansing the financial sector. The UAE Central Bank is not only issuing warnings but actively taking action against those who do not comply with the laws. This resolve serves the long-term security of the financial system – for investors and clients alike.

(The source of the article is a statement from the UAE Central Bank.)