This year, the Dubai Financial Services Authority (DFSA) imposed significant penalties on a company and an individual for serious misconduct involving client funds and money laundering activities. One of the most notable cases involved Peter Georgiou, a former relationship manager, who was fined nearly $1 million (around Dh3.6 million) for deceptive conduct and facilitating the money laundering technique known as “layering.”
Layering involves a series of transactions designed to obscure the origin of funds, creating the illusion that the money has moved between different people when, in reality, it remains under the control of the same individuals. Patrick Meaney, head of enforcements at DFSA, explained that Georgiou facilitated this by providing false information to his compliance department, allowing the illicit activity to continue. As a result, he earned substantial commissions but faced severe consequences. “It became career-ending for him,” Meaney said, emphasizing the deterrent effect of such penalties. In addition to the financial penalty, Georgiou was banned from working in the industry again.
The DFSA also took action against OCS International Finance, which was fined for misusing client funds. The company misled a bank regarding the nature of some money it had deposited, and then used those funds improperly. The company failed to keep client money in a separate account as required by regulations and lent the money to a related party without informing the clients. The related party did not repay the funds, compounding the problem.
Ian Johnston, chief executive of DFSA, explained that the authority follows rigorous investigative processes when handling complaints, involving data collection, communication reviews, and interviews. While such investigations can take several months, they usually take close to a year to complete.
This year’s cases, according to Meaney, have not been as severe in terms of the size of firms involved or the nature of breaches, which he hoped indicated that businesses have learned from past sanctions and become more compliant. The DFSA continues to enforce strict regulations to ensure the integrity of the financial sector in Dubai and beyond.
