A simple guide to customer checks reporting and penalties
Real estate firms must understand their customers, check payment sources and report suspicious activity. Use this guide to understand the main duties and organise your compliance work.
Know the main laws
- Follow Federal Decree Law No 10 of 2025 and Cabinet Resolution No 134 of 2025. These laws cover money laundering, terrorist financing and proliferation financing. [1,2]
- Check the rules and guidance that your supervisory authority applies to your business. The Ministry of Economy and Tourism supervises relevant DNFBPs within its mainland and commercial free zone jurisdiction. [3]
Check whether your business falls within scope
- Real estate agents and brokers fall within the DNFBP framework when they conduct property purchases and sales for customers. DNFBP means Designated Non Financial Business or Profession. [3,4]
- Check your actual activities and licence. Developers and property managers should confirm their reporting duties against their activities rather than rely only on their business name.
- Check the applicable regulatory regime separately if your firm operates in a financial free zone.
Set up your compliance programme
- Appoint a qualified compliance officer and define the officer’s responsibilities. [4]
- Maintain goAML registration and give authorised staff suitable access. [4]
- Document your AML policies, customer acceptance rules and escalation process. [4]
- Assess risks across customers, countries, services and payment methods. Apply stronger checks when risks increase. [2]
- Train staff and review whether they follow the procedures in real transactions. [4]
Identify your customer before the transaction
- Identify and verify the customer using reliable, independent evidence. [2,5]
- For companies, review the ownership structure and identify the people who ultimately own or control the business. [2,5]
- Check the authority of anyone who acts or signs for the customer. [2]
- Understand why the customer wants the property and whether the deal fits the customer’s profile. [5]
- Complete the required checks before or when you establish the relationship and before you execute the transaction, in line with the sector guidance. [5]
Check the source of funds
- Understand where the purchase money comes from and apply checks that match the risk. [2,5]
- For higher risk cases, obtain stronger evidence and assess the source of funds and wealth as required. Apply the additional measures that the rules require for politically exposed persons. [2]
- Practical example: request suitable evidence such as salary records, loan documents or an asset sale agreement ,third party Loan vs Investment manipulation etc…
- Practical example: explain and document why a third party pays on the buyer’s behalf. A bank transfer alone does not explain the underlying source of money.
Screen customers and monitor changes
- Screen relevant parties against applicable sanctions lists and follow targeted financial sanctions requirements. [3]
- Monitor transactions and keep customer information up to date. [2]
- Practical red flags include unexplained payer changes, complicated ownership with no clear purpose and reluctance to provide evidence.
- Ask further questions and escalate concerns to the compliance officer. A red flag requires assessment; it does not by itself prove a crime.
Keep clear records
- Retain the required records for at least five years under Article 25 of Cabinet Resolution No 134 of 2025. [2]
- Apply the correct retention starting date. Later inspections, investigations or judgments can affect how long you need to keep the records. [2]
- Organise the evidence so your firm can reconstruct a transaction and respond promptly to authorities. [2]
Report suspicious activity through goAML
- Escalate concerns internally and submit the appropriate STR or SAR to the UAE Financial Intelligence Unit without delay when required. [1,2,4]
- STR means Suspicious Transaction Report. SAR means Suspicious Activity Report.
- Protect report information. Do not tell the customer that you have submitted or intend to submit a suspicious report. [1,2]
Know when to submit a REAR
- REAR means Real Estate Activity Report.
- The FIU guidance covers freehold property purchases and sales involving cash of AED 55,000 or more, through one payment or several payments. [6]
- The guidance also covers virtual assets used for all or part of the property value and funds converted from or to virtual assets. Do not apply the cash threshold as a general exemption for virtual asset deals. [6]
- Submit the appropriate suspicious report as well if the transaction creates suspicion. A REAR does not replace an STR or SAR. [7]
Understand the penalties
- Administrative breaches: Article 17 allows fines from AED 10,000 to AED 5 million per violation and other supervisory measures. The applicable rules and facts determine the outcome. [1]
- Basic money laundering offence: Article 26 provides one to ten years in prison and a fine from AED 100,000 to AED 5 million, or the relevant criminal property value, whichever is greater. Aggravated cases carry higher penalties. [1]
- Corporate criminal liability: Article 27 provides fines from AED 5 million to AED 100 million, or the relevant criminal property value, whichever is greater, for specified money laundering, terrorist financing or proliferation financing offences. This range does not apply to every corporate compliance failure. [1]
Take practical action
- Review your customer files and close gaps in identity, ownership and payment evidence.
- Test staff knowledge, check reporting access and track corrective actions.
- Contact Alore Advisors at www.aloreadvisors.com for accounting and compliance support enquiries.
Key Legal references
- Federal Decree Law No 10 of 2025
- Cabinet Resolution No 134 of 2025
- Ministry AML supervision and legislation
- Ministry AML supervision and legislation
- Ministry DNFBP FAQs
- Ministry 2026 Supplemental Guidance for Real Estate Agents and Brokers
- FIU Real Estate Activity Report guidance
- FIU Reporting FAQs
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