Abu Dhabi FSRA Fines Aarna Capital $504,000 for AML Failures

The Financial Services Regulatory Authority (FSRA) of Abu Dhabi has imposed a $504,000 fine on Aarna Capital Limited (ACL) for failing to maintain adequate anti-money laundering (AML) systems and controls over a period spanning from June 2017 to January 2023.

An FSRA investigation revealed serious deficiencies in ACL’s AML framework. These included inadequate AML policies, ineffective customer due diligence (CDD) procedures, and failures to properly assess AML risks or assign suitable risk ratings to clients. Additionally, the firm did not effectively monitor customer transactions or maintain systems capable of identifying suspicious activity, leaving the business exposed to potential financial crime.

While the FSRA’s investigation uncovered significant lapses, no actual incidents of money laundering were identified. ACL fully cooperated with the probe and has since taken steps to address its shortcomings. By agreeing to settle early, the company qualified for a 20% reduction in its initial $630,000 penalty.

“The FSRA remains committed to advancing national efforts against money laundering and terrorism financing. All financial firms in the ADGM must maintain effective AML systems to mitigate financial crime risks,” stated FSRA CEO Emmanuel Givanakis.

The FSRA is part of Abu Dhabi Global Markets (ADGM), an international financial center located in the capital. ADGM has been pictured as a hub for global finance and regulatory oversight.

This enforcement action follows an announcement in October by Marex regarding its plans to acquire Aarna Capital as part of its strategy to expand regional operations. Marex CEO Nilesh Jethwa previously highlighted that the acquisition was intended to bolster the company’s reach among institutional investors, family offices, and corporate clients.

The FSRA’s fine serves as a reminder of the importance of maintaining robust AML controls within financial institutions operating in the ADGM and underscores its commitment to safeguarding against financial crime.

By fLEXI tEAM