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19 December 2019 — Former Compliance Officer fined and restricted from working in the DIFC

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Dubai, UAE, 19 December 2019: The Financial Markets Tribunal (FMT), a specialist independent tribunal, has affirmed a decision by the Dubai Financial Services Authority (DFSA) to fine Ms Anna Waterhouse and restrict her from being involved in providing financial services in or from the Dubai International Financial Centre (DIFC).

Ms Waterhouse was previously the Head of Compliance for the DIFC branch of Deutsche Bank AG (DBDIFC) covering the Middle East and North Africa. She was authorised by the DFSA as DBDIFC's Compliance Officer and Money Laundering Reporting Officer.

Following a lengthy and comprehensive investigation, the DFSA found that, on several occasions from 1 January 2011 to 21 January 2014, Ms Waterhouse gave false or misleading information to the DFSA. This was confirmed by the FMT's decision of 12 August 2019. In particular, the FMT found that she repeatedly told the DFSA that DBDIFC's Private Wealth Management (PWM) team only referred prospective clients to other offices of Deutsche Bank AG and did not provide them with any financial services. Ms Waterhouse was reckless as to the truth of these statements and ignored signs that breaches were occurring. As a result she did not correct the position over an extended period of time, which meant that failures in DBDIFC's client take-on and anti-money laundering processes were concealed from early 2011.

The FMT found that Ms Waterhouse knew of the true extent of PWM's activities by November 2011 at the latest and did nothing to communicate that to the DFSA until late 2013. The FMT found that Ms Waterhouse did not deal with the DFSA in an open and cooperative manner or disclose, appropriately, information of which the DFSA would reasonably expect to be notified.

The FMT concluded that Ms Waterhouse lacked integrity and was not a fit and proper person to perform functions in connection with financial services in or from the DIFC. The FMT said in its decision: "It is difficult to overstate the crucial importance to the well-being of financial markets that all those who accept positions as Authorised Individuals act with integrity and deal frankly and openly with the Regulator."

Bryan Stirewalt, Chief Executive of the DFSA, said: "It is fundamental that all Authorised Persons are open and honest with the DFSA. The penalty in this case reflects the fact that Ms Waterhouse not only failed to be open and honest with the DFSA, but recklessly misled the DFSA over an extended period of time."

The FMT's decision can be found on the FMT section of the DFSA website, and a copy of it can be accessed via this link.

Ms Waterhouse subsequently applied to the DIFC Courts for permission to appeal against the FMT's decision. On 12 December 2019, Ms Waterhouse's application was refused and she was ordered to pay the DFSA's costs in relation to the application for permission to appeal. A copy of the order with reasons of Justice Sir Jeremy Cooke is available on the DIFC Courts' website and can be accessed via this link.

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For further information please contact: Corporate Communications
Dubai Financial Services Authority Level 13, The Gate, West Wing
Dubai, UAE
Tel: +971 (0)4 362 1500
Email: DFSAcorpcomms@dfsa.ae
www.dfsa.ae

Editor's notes:

In April 2015, the DFSA published its related action against DBDIFC for misleading the DFSA, and for failures in DBDIFC 's internal governance and systems and controls and in its client take-on and anti-money laundering processes.

On 22 June 2017, the DFSA took enforcement action against Mr Chetan Parmar for providing false information to the DFSA. Mr Parmar was also a former employee of DBDIFC, and reported directly to Ms Waterhouse. The action against Mr Parmar resulted from the same facts and circumstances as the DFSA's action against both DBDIFC and Ms Waterhouse. Though the DFSA issued a media release concerning the action against Mr Parmar, it did not publish the Decision Notice given to him while Ms Waterhouse's reference to the FMT was still being heard. Now that Ms Waterhouse's reference to the FMT has concluded, a copy of the DFSA's Decision Notice detailing the reasons for its action against Mr Parmar can be found on the Regulatory Actions section of the DFSA website, and a copy of it can be accessed via this link

The FMT is operationally independent of the DFSA and it has its own rules of procedure. The FMT conducts a full merits review of DFSA decisions that are referred to it and determines the appropriate action for the DFSA to take. The President of the FMT. His Honour David Mackie CBE QC, is a former Judge of the English High Court.

The Dubai Financial Services Authority (DFSA) is the independent regulator of financial services conducted in and from the Dubai International Financial Centre (DIFC), a purpose-built financial free-zone in Dubai. The DFSA's regulatory mandate covers asset management, banking and credit services, securities, collective investment funds, custody and trust services, commodities futures trading, Islamic finance, insurance, an international equities exchange and an international commodities derivatives exchange. In addition to regulating financial and ancillary services, the DFSA is responsible for administering Anti-Money Laundering (AML) and Combating the Financing of Terrorism (CFT) legislation that applies in the DIFC. Please refer to the DFSA's website for more information.

Bryan Stirewalt was appointed Chief Executive of the DFSA on 1 October, 2018, after nearly 8 years as the DFSA's Managing Director of the Supervision Division. In his role as Chief Executive, Bryan will take the lead in steering the work of the DFSA and further developing its capability as a robust regulator delivering worldclass financial regulation in the DIFC. Bryan has played a vital part in executing the DFSA's regulatory mandate and developing its risk-based supervision framework. Bryan plays an active role in supporting the work of international standard-setting bodies. He now serves as the Co-Chair of the Basel Consultative Group (BCG), which provides a forum for deepening the Basel Committee on Banking Supervision's engagement with non-member, global supervisors on banking supervisory issues. Through this role, Bryan also serves as an Observer at the Basel Committee on Banking Supervision.