x Abu Dhabi, UAESaturday 20 January 2018

UAE and UK fight financial crime

The two countries say they will enforce new treaties to tackle tax fraud, money laundering and other serious crimes.

ABU DHABI // The UAE and British governments have agreed to improve the enforcement of treaties combating the growing sophistication of global financial crime. The two countries say they are committed to rigorously applying a series of new treaties covering extradition and legal assistance intended to help bring to justice criminals involved in tax fraud and money laundering and other serious crimes.

While the formal ratification process for the treaties was finalised earlier this year, authorities are now co-operating to bring them to life. A spokesman for Her Majesty's Revenue and Customs in Britain said a "substantial" amount of the estimated £2 billion (Dh13.5bn) lost annually through VAT fraud in the UK was laundered in the UAE. At the peak of the problem, a large proportion of the money defrauded from the British government passed through the UAE.

Edward Oakden, the British ambassador to the UAE, said the most serious crimes included "fraud against our tax system and other forms of financial crime, such as the laundering of drug assets". "With Dubai being such an important financial centre, like the City of London, we inevitably have to guard against our facilities being used by money launderers," he said."The key is to have the instruments in place and the practice of co-operation that acts as a deterrent. Both ourselves and UAE authorities are committed to ensuring that we are not perceived by criminals as a weak link."

These deterrents include a bilateral agreement that allows extradition to be requested for any offence that carries a sentence of a year or more in prison in both the UK and the UAE. If, for example, an Emirati commits a serious crime such as fraud or murder in Britain and then flees to the UAE, the agreement will allow the UK to obtain the extradition of the individual. A provision in the agreement will allow the UAE to obtain similar extraditions only if the UK has assurances the suspect will not face the death penalty here.

A Briton wanted by Dubai Police and Interpol for allegedly swindling property investors out of millions of dirhams could become the first person to be extradited to the UAE from Briton. Emad Ayoub, 53, was accused of fleeing Dubai in 2006, leaving behind an unfinished 15-storey apartment block in Dubai Marina after investors had paid him more than Dh36 million (US$9.8m) for units. Meanwhile, another treaty on mutual legal assistance in civil, criminal and commercial cases essentially allows greater sharing of evidence, which in cases of fraud may include bank account details or telephone records.

The agreements would also minimise instances of criminals escaping punishment because of differences in the countries' legal systems. While the formal ratification process for the treaties was finalised earlier this year, authorities are now co-operating to bring them to life. "It's making them work in practice, making them come alive so they aren't just dry legal instruments, but give us the wherewithal to bring criminals to justice," said Mr Oakden, who met Dr Hadef bin Jua'an al Dhaheri, the Minister of Justice, last week to discuss ways of achieving this.

Authorities in both countries are currently familiarising themselves with each other's legal procedures and are holding workshops to improve co-operation. If, for example, Britain requested information from the UAE relating to a crime, the request would go through an agreed process that would make it easier for the UAE to respond. Co-operation between the two countries is becoming increasingly urgent as the number of UK citizens in the UAE swells. There are about 120,000 Britons in the country, approximately 100,000 living in Dubai, and growing numbers of Emiratis in the UK. With greater concentrations comes a greater instance of "bad apples", Mr Oakden said.

A concerted campaign by British and UAE authorities has already reduced cases of VAT fraud in the past two years. The recent treaties are expected to smooth the investigation and trial procedure of these crimes. rditcham@thenational.ae