The United Arab Emirates central bank sees increased risks of illicit financial flows emerging from the pandemic. This includes money-laundering and terrorism financing. The use of unlicensed money service providers for money laundering has increased during this pandemic, as per the report. And also, the use of e-commerce to launder money. It also stated that the widespread lockdowns have resulted in a significant surge in e-commerce. Due to limited ability to move funds and goods during the pandemic, illicit actors are turning to e-commerce as a money laundering tool.
The money mules are the people who receive illicit funds into their bank accounts. This takes a commission, for their services increased, with accounts in the majority of cases that belongs to low-income individuals from Africa and Asia, as per the bank. It also identified fraud risks linked to the pandemic. Which are the false claims that qualify for government stimulus support measures. As they continue to monitor and learn more about the spread of COVID in their communities, they have recently observed heightened external fraud threat. This includes the cyber and fraud attacks.
As the central bank steps, up efforts to combat illicit financial flows, the report comes up. The Financial Action Task Force is an intergovernmental anti-money laundering monitor. It stated that “fundamental and major improvements” were needed to avoid it placing the UAE on its “grey list” of countries.