Following a wave of harsh EU, UK and US sanctions, wealthy Russians have flocked to the UAE to buy property and register businesses.
Following Russia's invasion of Ukraine, wealthy Russians are rushing to invest in the UAE, according to multiple sources.
Following the invasion last month, tough sanctions were imposed on Russian oligarchs to put pressure on President Vladimir Putin.
Numerous Russian banks have been banned from SWIFT, and the Russian Central Bank has been sanctioned.
It appears that the UAE has become a favourite destination for Russian money in recent weeks.
“Russians are now unwelcome banking customers in Europe, even though the majority went there to get away from Putin,” said Peter Gray, partner at ADG Legal in Dubai.
"People are worried about what the banks will do – the banks are afraid of sanctions and expensive investigations and so are reluctant to continue business with Russian nationals, regardless of their political affiliation," said Mr Gray.
The UAE has recently come under fire for abstaining from voting against the invasion at a UN Security Council. Despite this, the UAE backed a subsequent general motion.
Wealthy Russians can secure visas for themselves and family members by setting up businesses in the UAE, and UAE companies report up to 50 inquiries per day from Russian, Ukrainian and Belarusian businesspeople interested in establishing companies in the Emirates.
Bloomberg also reports an increase in Russian money entering the UAE via cash transfers and crypto wallets. In a statement to Bloomberg, co-author Jodi Vittori said, “What separates Dubai from other traditional havens for dirty money is the amazing secrecy.”
“He added: “As a fugitive in Dubai, you can snatch up property, stash your yachts and set up bank accounts with very few obstacles. It’s also one of the few autocracies that’s a destination – rather than a transit location – for illicit flows, ” he continues.
The UAE was hit last week when the Financial Action Task Force added it to its ‘Grey List'. Countries on the list are under "increased monitoring" by FATF for their anti-money laundering procedures.
H.H. Sheikh Abdullah bin Zayed Al Nahyan, UAE Foreign Minister, promised the Gulf Nation will make a “genuine difference” in its ability to “prevent financial flows”.
The UAE was "keen to accelerate" its National Action Plan to combat money laundering and terrorist financing, said Sheikh Abdullah, who also chairs the Higher Committee overseeing the national AML/CFT strategy.
Sheikh Abdullah said the UAE's "strategic priority" was the Action Plan. He continued to say that he would like to "underscore the UAE’s commitment at the highest level by strengthening our national AML/CFT framework."
By fLEXI tEAM