The United Arab Emirates (UAE) has temporarily suspended the operations of 32 gold refineries, accounting for 5% of the market, in a significant move to combat money laundering and terrorist financing in the precious metals sector, according to a statement from the Ministry of Economy.
The Ministry emphasized its ongoing commitment to enforcing a stringent legislative and regulatory framework to fight money laundering and terrorist financing, aligning with international standards.
“In this context, the Ministry conducted several field inspections of activities related to the trade and manufacturing of precious metals and gemstones to ensure compliance with anti-money laundering laws,” the statement read. “These inspections led to the temporary suspension of 32 gold refineries from July 24 to October 24, 2024, due to 256 violations, averaging eight per refinery. Major violations included failing to identify risks, neglecting to report suspicious transactions to the Financial Information Unit, and not screening customer and transaction databases against terrorism lists.”
Abdullah Ahmed Al Saleh, Undersecretary of the Ministry of Economy, reaffirmed the UAE’s dedication to creating a comprehensive legislative and regulatory system to tackle money laundering. “We are committed to achieving the highest levels of compliance with due diligence regulations for the responsible gold supply chain, adhering to the best global practices,” he stated. He also highlighted the Ministry’s efforts to intensify inspections across various non-financial sectors, including real estate brokers, corporate service providers, and auditors, to ensure compliance with anti-money laundering laws.
The Ministry’s actions are part of its supervisory role over the gold sector, in line with international standards, particularly those of the Organization for Economic Co-operation and Development (OECD).
The UAE has faced mounting pressure to address illegal practices in its gold sector amid allegations of overlooking gold smuggling and money laundering. A report by Swissaid in May highlighted that two-thirds of the gold imported from Africa to the UAE in 2022 was smuggled before being re-exported.
“Between 321 and 474 tons of artisanal gold are produced annually in Africa without being declared, with at least 435 tons smuggled out in 2022 alone,” the report noted. This represents a significant revenue loss for many African nations.
The primary importers of African gold include Switzerland, the UAE, and India. “The UAE, lacking domestic mines, imports much of its gold from Africa, often undeclared,” Swissaid reported. “Between 2012 and 2022, 2596 tonnes of gold not declared for export were imported from Africa to the UAE.”
Marc Ummel, head of Swissaid’s raw materials unit and co-author of the study, remarked, “For many years, smuggled gold potentially linked to conflicts or human rights violations has legally entered Switzerland.”
