ADGM Sharpens Focus on DNFBPs with Latest AML Compliance Findings

The ADGM Registration Authority (RA) has issued two new reports setting out the results of its 2024 supervisory reviews into Designated Non-Financial Businesses and Professions (DNFBPs). The message is unmistakable: firms in this category, ranging from legal and accountancy practices to real estate agencies, CSPs and dealers in high-value goods, must raise the bar on anti-money laundering (AML) compliance, or face the consequences.

Drawing on a mix of thematic and onsite inspections, the RA has identified recurring weaknesses in how DNFBPs assess risk, report suspicions, and manage compliance frameworks. And while many firms appear to tick the right boxes on paper, the reviews suggest that too many still fall short in implementation and oversight.

From paperwork to practice

The thematic review, published in June 2024, examined how firms approach their Business Risk Assessments (BRAs), suspicious activity reporting, and AML training. Although the majority of DNFBPs had policies in place, the RA found widespread shortcomings in how those policies were applied.

In particular, many firms failed to distinguish clearly between different types of financial crime risk (money laundering, terrorist financing, and proliferation financing) despite this being a core requirement under ADGM rules. Others used off-the-shelf documentation that bore little relevance to the firm’s actual operations or client base. And in too many cases, the findings of the BRA were never communicated to staff, leaving front-line employees unaware of the risks they were meant to manage.

Suspicious activity reporting also came under scrutiny. While most firms had procedures in place to file Suspicious Activity Reports (SARs) with the UAE Financial Intelligence Unit via the goAML portal, the RA identified a disconnect between policy and practice. Some firms required senior management sign-off before filing a SAR, undermining the independence of the MLRO, while others failed to maintain accurate contact records or adequately explain how suspicions were identified.

Onsite assessments reinforce concerns

These issues were echoed in a second report detailing the results of 32 onsite inspections carried out across the DNFBP sector. The most common failings included:

• inadequate enhanced due diligence for high-risk customers, particularly in verifying source of funds and wealth;

• failure to assess TFS risks within the BRA;

• outdated AML and TFS controls that hadn’t been reviewed or tested for effectiveness;

• weak ongoing monitoring and poor client screening post-onboarding;

• failure to obtain certified copies of ID documents; and

• ineffective succession planning for MLROs.

Although many firms demonstrated a willingness to engage with the process, undertaking risk assessments, updating policies, and launching training programmes, the RA emphasised that compliance must be embedded, not just documented.

A harder line

The tone of both reports is more direct than in previous years. The RA is signalling that supervisory tolerance is narrowing. DNFBPs found to be non-compliant may be subject to follow-up inspections, enforcement action, or even license suspension. With ADGM aligning closely to national AML strategy and FATF priorities, firms that fail to meet expectations risk reputational as well as regulatory damage.

For firms operating in or through ADGM, the takeaway is clear: risk-based compliance is no longer optional, and a superficial approach is unlikely to survive regulatory scrutiny. These reports provide not only a window into the RA’s expectations but also a practical roadmap for remediation.

Where to find more information

Firms can read the full findings and recommendations directly on the ADGM webpage, where the thematic and onsite review reports are now available.

Need help closing the gaps?

At Clarity, we help DNFBPs go beyond box-ticking.

Whether you need to overhaul your BRA, stress test your AML/TFS controls, or prepare for an ADGM inspection, we offer practical, sector-specific support.

Get in touch to discuss a health check or tailored remediation plan.