The Dubai Financial Services Authority (DFSA) has imposed a fine of USD 109,200 on Vault Wealth Limited (VWL) for providing financial services in or from the Dubai International Financial Centre without regulatory authorization. VWL, which is incorporated in the Abu Dhabi Global Market and licensed by the Financial Services Regulatory Authority, operated from DIFC offices between February and May 2024 without the required DFSA approval.
- Fine Amount: USD 109,200 (AED 401,000), reduced by 30% from USD 156,000 after settlement
- Violation Period: February to May 2024
- Services Provided: Investment advice, credit advice, and investment arrangement
- Regulatory Breach: Article 41(1) of the DIFC Regulatory Law 2004
During the violation period, VWL employees operated from the offices of Vault Technology Limited, a related DIFC entity that was not regulated by the DFSA. The company invited prospective clients to the DIFC office, provided financial advice, and assisted with onboarding onto investment platforms while collecting know-your-customer documentation. The DFSA found that the office did not clearly indicate the separation between the two entities, potentially misleading clients about VWL’s regulatory status.
The regulator identified aggravating factors in its enforcement decision. VWL’s senior management were aware of the requirement to obtain DFSA authorization but failed to proceed with the application. Management also disregarded concerns raised by the company’s then Compliance Officer regarding the licensing gap.
The prohibition against providing financial services in or from DIFC without the required DFSA authorisation is fundamental to the integrity of the DIFC’s regulatory framework and to the protection of those who use, or may use, financial services within the Centre. Authorisation by another regulator does not permit a firm to conduct financial services in or from DIFC. Firms must ensure that they have the appropriate DFSA authorisation before undertaking regulated activity here.
– Alan Linning, Managing Director, Enforcement, DFSA
The DFSA stated that the enforcement action demonstrates its commitment to intervening where firms operate outside the regulatory perimeter and imposing sanctions proportionate to the severity of misconduct. VWL agreed to settle the matter, resulting in the 30 percent fine reduction.
Alan Linning, Managing Director, Enforcement at DFSA. Source: LinkedIn
