UAE Announces AED 1m Fine And Imprisonment For Unlicensed Money Collection

The Public Prosecution of UAE takes it to social media to explain the consequences of collecting money without a license. If anyone manages a fake company or portfolio for the sake of collecting money from the citizens for investments, management, utilization, or development, without obtaining a license prior shall be punished with a monetary penalty of a minimum of 250,000 AED and a maximum of 1 million AED or shall be sentenced to imprisonment for not less than 5 years of duration.

The person or the team found guilty is also commanded to return the acquired money by the court. Even the organizations with licenses are not supposed to broadcast, publish, advertise, or do promotions for the fundraising campaign without the approval of the exercising authorities, as per article 46 of Federal Law No. 34 of 2021, on combating rumors and cybercrimes which came into effect from 2nd of January 2022.

Donating and Raising Funds in UAE

These social media posts are part of Public Prosecutions’ continuous efforts in raising awareness and updating the public with the latest laws. This action was mandatory for the safety of society and to promote a legal culture within the public.

Donating and Raising Funds in UAE

Donations are stipulated by Federal Law No. 3 of 2021. Collecting items of monetary value whether cash or in kind, transferred or fixed, including national currency, foreign exchange, bonds, cheques, and shares, in any form, including electronic or digital, to be spent on charity or through charitable or humanitarian services and aids are all considered as donations.

Even for charitable activities, one needs to register with competent organizations and get a license, or else it’s deemed a crime and a punishable offense. Islamic Affairs and Charitable Activities Department, International Humanitarian City, and Community Development Authority are the entities that can give official recognition and licenses to charitable organizations, NGOs, and other Humanitarian organizations.

The purpose of all these regulations is to protect the donor contributions and to make sure they reach the intended beneficiaries. Even begging is a crime in the UAE. Anyone caught begging will be fined AED 5000 and imprisoned for up to three months under Federal Law No. 9 of 2018.

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The gangs of beggars or teams recruiting people from other countries to beg will be faced with a minimum fine of 100,000 AED and a jail term of not less than 6 months. The Law of the Emirate prohibits any natural person from hosting, organizing, or carrying out any fundraising activity.

It’s considered a grave offense and punished with imprisonment and fines not less than AED 150,000 and not more than AED 300,000 or either of the two penalties. There are additional regulations on fundraising such as Article 8 of Federal Law No. 4 for 2018, Concerning the regulations and care of Mosques, that ban collections or contributions at mosques without prior consent from the competent authorities.

How to raise funds legally?

Fundraising done through traditional methods or digitals platforms are limited to organizations that are deemed charitable by law,

and to government and non-government public interest institutions whose laws or resolutions of establishment confirm that they may conduct such activities.

If any UAE National wishes to set up a charitable trust they must produce an application online to the Ministry of Community Development. Expatriates must apply through their respective embassy or consulate in the UAE. The Ministry will go through the applications and forward them to Cabinet, which takes the final decision regarding the matter.

Any non-profit association that wishes to raise donations must obtain a license from the Ministry of Community Development or a competent authority from each of the Emirates. It’s mandatory to do Fundraising activities through one of the licensed charities or humanitarian organizations. Also, the applicant must get the approval of the respective charity, state the objectives of the charity, list the names and provide the IDs of the person in charge of the event,  mention the recipient, and also must list the location of the fundraising.

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