UAE Fines Financial Firms for Tax Breaches

Financial Firms Fined in UAE Over Tax Irregularities

The United Arab Emirates' financial regulatory authority, the Securities and Commodities Authority (SCA), made further progress in 2025 to strengthen international tax transparency and cooperation. The SCA imposed a total fine of 325,000 dirhams on several financial institutions that failed to meet international tax compliance obligations.

What's Behind the Fines?

The sanctions followed detailed investigations, which revealed that the affected financial companies incompletely or inadequately complied with the Foreign Account Tax Compliance Act (FATCA) and the Common Reporting Standard (CRS). These regulatory frameworks play a crucial role in curbing international tax evasion and facilitating cross-border financial information sharing.

FATCA is a U.S. law requiring foreign financial institutions to report on accounts held by American citizens to U.S. tax authorities. Meanwhile, the CRS, developed by the OECD, similarly obliges participating countries' financial institutions to engage in automatic information exchange.

SCA's Message to Industry Players

In its statement, the authority emphasized that every financial institution is obliged to fully comply with domestic and international regulations. It highlighted that to avoid future fines, financial companies must immediately review their internal compliance processes and strengthen control mechanisms.

SCA aims to preserve the integrity and credibility of the UAE's financial markets, ensuring their full alignment with international best practices. This is particularly important in the realm of global tax cooperation and cross-border financial reporting, where the country seeks an increasingly active role.

What Lies Ahead?

The current fines send a clear message to all market participants: tax transparency is no longer optional but a mandatory standard. The UAE aims for its financial sector to remain reliable, internationally recognized, and transparent—especially in cities like Dubai, where the presence of global financial actors is particularly strong.

In parallel with tighter regulations, financial institutions are expected to increase investments in the digitization of tax and compliance systems and in employee training.

(The article source: Securities and Commodities Authority's (SCA) statement.)