The Gulf’s battle to tackle the spread of ‘dirty’ money

Reuters/Mohamed Azakir

The world has a major fight on its hands in trying to combat money laundering.

First, let’s be clear what we mean by money laundering or money washing. It’s taking “dirty” money, the proceeds of crime and cleaning it, or disguising its origins, so those funds can be used in the legal financial system.

The process has three stages: depositing, often in smaller amounts; doing it over again, which is known as layering; and integrating, moving the money on.

In one year an estimated 2 to 5 percent of global GDP, or $800 billion to $2 trillion, is laundered worldwide. That could be cash from drugs deals, fraud, corruption – the list of illicit activities is a long one.

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This is an educated guess as the point about money laundering is to ensure it’s hidden, so ascertaining the true figure is impossible.

But all governments have financial intelligence units to try and get on top of the practice. They collect, analyse and exchange information and, in some cases, carry out investigations and seize assets.

That’s where the United Nations Office on Drugs and Crime (UNODC) comes in. We partner the national authorities with their anti-money laundering efforts. We ensure the smooth working of international conventions and protocols, so they can operate effectively.

We have been working with the six Gulf countries. With the UAE, we’ve been focusing on 12 or so areas, and the level of commitment displayed by the UAE to tackling money laundering is impressive.

It’s based on a solid understanding of the threats and challenges they are facing geographically and historically. These include organised crime, corruption and terrorism, illegal drug trafficking and human trafficking.

The UAE has a comprehensive legal framework in place to battle money laundering and terrorism financing, including laws that provide for the seizure and confiscation of proceeds of crime.

The UAE has also demonstrated a strong commitment to international cooperation in these areas and has established strong partnerships with other countries and international organisations to detect and investigate financial crime.

Under a memorandum of understanding, signed in October 2022, at our headquarters in Vienna, the UNODC and the UAE’s executive office will work together to share information and develop tools and guidance materials related to anti-money laundering (AML) and counter-terrorism financing (CTF).

We’ll also work with them at the legislative, strategic, and operational levels to help implement effective AML/CTF measures.

The GCC region is targeted by organised crime groups, not only as countries of destination but as conduits, preying on their position as global and regional trade and travel hubs.

The leaderships of the six Gulf countries are well aware of the challenges they face and are committed to working with the UNODC to hit back. 

We are more a partner to the national authorities concerned with fighting drugs and crime – the UNODC is not an “evaluator/assessor” body.

Reuters/Rula Rouhana

We attach great importance to this fact and would like to remain in this position. The UNODC, as custodian of international conventions and norms on drugs and crime, has obligations to work with the state’s parties to those conventions.

We are mandated to help them overcome challenges posed by drugs and crime. We have good trust based relations with them. The UNODC empowers the national and regional authorities to establish their own cooperation and information sharing and information analysis centres. 

The UAE, along with the other GCC members, appreciate their vulnerability to international criminal threats. Any country which is a trade hub will be targeted by illegal trade.

When the country is rich, then you will be targeted by those who will try to benefit. When your country is a travel hub, then you will experience illegal transit attempts in people, cash, goods, drugs and weapons.

Through this status of partnership and trust with the member states of the Gulf, we have been able to help them to do many things in support of the international community.

Our mandate provides support to the member states to respond to the challenges posed worldwide. The UNODC is here to support and provide assistance.

Dr Hatem Aly is regional representative of the United Nations Office on Drugs and Crime for the GCC region