Dirty Money in Paradise? Dubai Leaks Triggers Ownership Concerns in Real Estate Sector

Dubai, a business hub renowned for its elevated skyscrapers, prosperous lifestyle, and position as a global economic hub, sparks a new concern globally. Despite being the playground for the rich and famous, the Gulf City holds lax regulations in the real estate industry, making it an attractive investment point for elites, political entities, and imposters globally. Dubai Leaks, a coalition of about 70 media platforms, discloses this Middle Eastern economic hub has extended its doors to people charged with corruption worldwide. Read this article and discover how “Dubai Unlocked” is a contemporary cause of concern for businesses and international law enforcement authorities globally.

Dubai Unlocked: A Question Mark on the Real Estate World?

Today, Dubai’s booming property market, a magnet for foreigners, has a dark side. Secrecy in the real estate sector allows criminals to hide. Foreigners make up around 90% of the inhabitants. Nevertheless, the official registry records are difficult to obtain in the region as no open access is available. This leaves a prominent loophole for international law enforcement agencies since they cannot identify which citizen owns how much property in the United Arab Emirates.

While previous investigations focused on regions and countries, Dubai Leaks primarily focused on real estate ownership. The revealed logs, dated mainly from 2020 and 2022, were originally acquired by the Center for Advanced Defense Studies, A Washington, D.C.-based nonprofit organization conducting a study on international crime & conflict. The details were later communicated with the Norwegian financial outlet E24 and the Organized Crime and Corruption Reporting Project (OCCRP), which initiated an investigation project in collaboration with 75 media outlets.

Revelation Uncovered by Investigative Journalists

The extensive report was recently shared by reporters who identified individuals worldwide owning properties in Dubai without revealing their ownership details in public registries of the region. These figures include everyone, whether money launderers, drug lords, political entities accused of corruption, as well as their associates or business owners sanctioned due to financial terrorism.

Using the data as a foundation, journalists examined the circumstances of foreign property ownership in Dubai. Throughout several months, they diligently examined released datasets, open-source research, government documents, and additional compromised datasets to validate the implicated individuals’ true identities and ownership status. To ensure the initiative’s integrity, reporters have exclusively recruited individuals whose identities could be verified externally.

Furthermore, the integrity of the individuals listed in the data was verified by consulting Dubai’s official land registry. Due to the recent property sale, reporters were occasionally unable to ascertain the present ownership status of certain items. Supplementary measures were implemented to validate the individual’s property ownership status in Dubai, including cross-referencing their passport particulars with a publicly accessible government database containing information on property owners.

Source of Dubai Property Data

The project’s primary source of property records is a series of data breaches, mostly from publicly owned utility firms and the Dubai Land Department. When combined, the data provides a thorough picture of hundreds and thousands of properties in Dubai as well as who owns them and how they are used. The information was acquired by the non-profit Center for Advanced Defense Studies (C4ADS). The Organized Crime and Corruption Reporting Project (OCCRP), which oversaw an investigation involving several media outlets from throughout the globe, and the Norwegian financial portal E24 were then given access to it.

Along with other identification details with date of birth and passport number, the data contains the controlling party of every property. Economists from The EU Tax Observatory and Norway’s Centre for Tax Research, who examined the stolen data, projected that foreign ownership in Dubai’s property market would be worth $160 billion in 2022. For this research, these organizations decided to spotlight around 200 persons who possessed over 1,000 assets that we discovered in the data and then confirmed. These people included political officials, illegal immigrants, accused criminals, and sanctioned persons.

Is Dubai Leaks Different from Other Investigations?

Dubai has been identified for years as a significant hub for money laundering, with its real estate sector being a particular target. Prior inquiries have concentrated on the real estate properties of individuals from various countries across the world. However, Dubai Unlocked stands as the inaugural undertaking of its nature to examine ownership in the city from an international standpoint. Furthermore, it is constructed upon more reset databases primarily comprising property records that were compromised in 2022 and 2020.

From government officials accused of corruption to businesses sanctioned for supporting terrorism, among many others, journalists have identified hundreds of Dubai property owners they feel the public should be informed about.

A Wake-Up Call for UBO Disclosure?

The leaks serve as an explicit wake-up call for the UAE to bring regulations in place while taking the following regulatory measures.

  • Revealing Discrepancies: Dubai leaks expose properties owned by individuals who don’t appear as legal owners based on ultimate beneficial owner UBO data. This could indicate suspicious activity or the use of shell companies to hide actual ownership.
  • Identifying Missing Information: The leak reveals property ownership by individuals not currently listed in any UBO registry, requiring prompt investigations into the source of their funds and potential criminal activity.
  • Strengthening UBO Laws: The Dubai Unlocked particularly highlights weaknesses in existing UBO regulations in Dubai. It clearly indicates how it is crucial to adopt stricter laws requiring more comprehensive and transparent ownership disclosure.

Enhanced Transparency Laws: A Global Requirement

The Dubai leaks serve as a call for nations worldwide to wake up and realize the significance of implementing transparency laws on a global scale. Enforcing strict business ownership regulations and improving public access to financial information. Furthermore, requiring companies and trusts to disclose ownership information in a central, public registry would increase scrutiny and make it harder to hide beneficial owners. This is the time for countries to take steps to prevent future scandals and build trust in their economic systems.

How The KYB Can Help

With its extensive data sources across 300 Million+ companies worldwide, the KYB, a world-class source of UBO compliance and business verification, helps companies and nations expose businesses owned by individuals on sanctioned lists or with criminal ties. This triggers investigations into these businesses and potential sanctions for non-compliance. Additionally, the recent leaks require companies and officials in Dubai to be more vigilant about checking potential partners or clients against the Dubai Leaks data.

Ensure compliance with Ultimate Beneficial Owner (UBO) and other regulations to add an extra layer of security with the KYB.

To learn more about how The KYB can help you in the verification of businesses, Get in touch with our team for further information.

The Comprehensive Guide to Ultimate Beneficial Owner (UBO)

The financial industry is highly regulated, ranking among the world’s most strictly governed fields. The same level of oversight is applied to the financial dealings of multinational firms. Several pieces of anti-money-laundering legislation have been passed in recent years, increasing the difficulty of maintaining regulatory compliance in the financial sector. Authorities in many countries have been brainstorming new strategies to combat the global expansion of money laundering. 

Government agencies learned the hard way that the absence of beneficial ownership transparency was a gap in the existing due diligence mechanism after the Panama Papers Leak. Lack of transparency over beneficial ownership was a significant issue that enabled criminals to launder money through offshore accounts. 

In 2016, regulators began pushing back with new laws regarding UBOs and companies’ disclosure of related data. It is essential, not just to adhere to FinCEN requirements, to determine who the genuine Ultimate Beneficial Owner is. Without UBO checks, an organization could be linked to money laundering and terrorist financing, just like Singapore-based DBS Bank Limited. They were accused of not taking anti-money-laundering measures sufficiently. The firm was charged a $25,000,000 penalty for other alleged financial wrongdoings. Now, proper due diligence is crucial more than ever. 

What is UBO?

A corporation’s Ultimate Beneficial Owner is the person or entity with the company’s most significant direct or indirect financial interest. This person is the ultimate beneficiary of the company’s actions, even if they do not have hands-on management responsibilities. Compliance with anti-money-laundering (AML) legislation and limiting the risk of financial crimes depend on knowing who the Ultimate Beneficial Owner is. 

As defined by the Financial Action Task Force, “UBO is the natural person who ultimately owns or controls a customer and the natural person on whose behalf a transaction is being conducted.“. It also includes people with ultimate effective control over a legal entity or arrangement, as limited by FATF’s beneficial owner rules.

  • Individuals who hold at least 25% of the company’s shares; 
  • Individuals who account for at least 25% of the vote,
  • Investors who receive at least 25% of a company’s profits, 
  • Authorized representatives, 
  • Guardian of minors,
  • A company’s owners might be hidden from public view by appointing corporate or nominee directors.

Importance of UBO 

Those subject to regulation must have complete confidence in the parties they deal with. Validating the real identities of legal people is essential to regulatory compliance, whether clients or business partners. It also helps prevent monetary loss and safeguards the company’s reputation.

The United Nations Office on Drugs and Crime states that more than $2 trillion is made illegally yearly. If a company’s UBOs are exposed, they may try to cancel their identities to avoid legal ramifications rather than admit to engaging in criminal activities. By remaining anonymous, criminals can engage in activities like tax evasion, money laundering, embezzlement, and corruption. Disclosure of beneficial owners enhances the financial system’s safety and openness.

The Difference Between Beneficial Ownership and Legal Ownership

Beneficial ownership and legal ownership diverge in the realm of rights and control over assets. Legal ownership stands as the official recognition of ownership, granting legal rights and obligations. In contrast, beneficial ownership encompasses the actual perks derived from an asset, such as profits and decision-making authority. While legal ownership is on paper, beneficial ownership underscores tangible benefits. This contrast holds weight in trading, anonymity, concealing assets, tax avoidance, influencing transparency, and accountability.

Some of the reasons why beneficial and legal ownership are different are as follows:


For security and convenience reasons, many people who possess securities prefer to trade them under their broker’s name. This practice is legitimate and frequent in the banking industry. 


Some people conceal their true identity by registering their assets under someone else’s name for security and privacy reasons. Famous people, politicians, and others who don’t want their home address made public could re-title their property in someone else’s name. There is no law against this.

Concealing Assets

Some people have assets registered differently to avoid losing property after a divorce or lawsuit. Financial fraud, including the use of beneficial ownership, is prohibited.

Tax Avoidance

Some individuals and businesses prefer to split ownership of their assets among several names to reduce their taxable income. Using beneficial ownership in this way is prohibited since it is used to avoid paying taxes.

Money Laundering

Money laundering hides the genuine ownership of assets and the origin of funds gained illegally. The Ultimate Beneficial Owner of illicitly acquired assets may be concealed, or their involvement with money laundering may be hidden by having those assets registered in another legal owner’s name. Terrorist groups might also benefit from money launderers. Both individuals who engage in money laundering and those who help it by failing to enforce internal anti-laundering policies face legal consequences.

How to Identify The UBO?

The UBO must be located through a series of steps that may include:

  • Understanding the business structure: To start, learn everything about who owns and runs the company, directly as well as indirectly. 
  • Analyzing the supporting paperwork: For clues as to who the UBO is, look at shareholder agreements, trust deeds, and partnership contracts. These records may reveal essential facts regarding the company’s management and ownership.
  • Performing due diligence: Investigate the business, its owners, and any associated parties to spot warning signs that could lead to further scrutiny.
  • Tracing the ownership chain: Find out who controls the company by following the money trace. For this purpose, reviewing trust deeds, share registers, and other legal documents is necessary.
  • UBO Authentication: Once the UBO has been located, their ownership stake and identification must be confirmed using external resources such as public documents and databases. It is critical to follow these procedures precisely to get the right Ultimate Beneficial Owner.

Influencing Factors on Compliance

Some recent developments that may impact the organization’s compliance and risk management are:

Russia-Ukraine conflict: In 2023, the war will likely continue as before. Sanctions avoidance tactics led to stricter oversight in the United States and Europe. Firms must revise risk management and due diligence procedures for business with Russian clients or suppliers.

Production-side supply-chain elements: Due to political changes, manufacturing supply chains have relocated to other nations, often through local alliances. Check the beneficial ownership of any foreign partnerships with foreign legal persons.

Cryptocurrencies: The OECD unified a reporting standard for crypto-assets, including beneficial ownership reporting, to narrow tax avoidance gaps.

Be wary if a business or a client of yours operates in an industry affected by the following:

  • Energy sources and petroleum-based goods
  • Wheat farming and industry
  • Processing of metals, including iron, aluminium, and copper
  • Appliances and electronics
  • Corporations dealing with money, such as banks
  • Services related to money and finance, such as insurance and investment advice
  • Digital currency services

Read more: How to Collect & Verify Beneficial Owner’s Information for Compliance

UBO Reporting Requirement 

Businesses are required by law in many countries to disclose details about their UBOs to the appropriate authorities. The rules and regulations in a region may call for different reports. Among the most often seen report formats are:

Creating a Centralized Registry for UBO Data

UBO data must be registered with a government agency in some regions. This may make it simpler for authorities to detect and keep tabs on UBOs, increasing transparency.

Regulatory Filings and Annual Reports with UBO Information

UBO data may be required for various industries’ annual reports and regulatory filings. The ownership structure of a corporation will always be up to date if this is done.

The Sharing of UBO Data with Banks and Other Businesses

As part of due diligence, firms may need to reveal UBO information to banks or other companies. By doing so, firms can avoid unknowingly helping in committing financial crimes or conducting business with potentially dangerous individuals or organizations. Knowing and following the reporting regulations relevant to the company and legal system is paramount.

Challenges to Identifying and Verifying UBOs 

Several obstacles must be overcome, which adds extra work and time to discovering and certifying a UBO. Among these challenges are:

Complex Ownership Structures 

A company may have several layers of ownership or control. Because of the complexity of the company’s ownership structure and the relationships between the many organizations, identifying the Ultimate Beneficial Owner can be challenging.

Lack of Transparency 

It might be challenging to get up-to-date information on a company’s UBO because of lax laws in some jurisdictions. The need for clarity may hamper the identifying and verifying procedure.

Shareholders and Directors Up for Election

Identifying the UBO can be even more difficult for nominee directors and shareholders. When these middlemen are selected to work on behalf of the UBO, it becomes more complicated to determine who the actual owner is.

Restricted Access to Data

A company’s UBO data is not readily available or is held by a third party. This can make collecting the data needed to identify and verify the UBO appropriately challenging.

Despite these obstacles, businesses must identify and validate the UBO; otherwise, the company could face severe legal and financial repercussions.

Step-by-Step Ultimate Beneficial Owner

Each country where a firm operates has its regulations that must be followed. However, several consistent steps must be taken to create an effective UBO program strategically.

  • Check The Company’s References

Company information like name, address, legal standing, key personnel, and verification of record correctness must be provided.

  • Determine Who Owns What and How Much

Knowing who owns shares in the company and how they are invested is essential.

  • Identify Beneficial Owners

Businesses can spot a UBO by calculating the overall percentage of shares, ownership stake, as well as managerial control held by the entity or natural person in question and then checking to see if any of those factors bring them under the purview of a UBO.

  • All UBOs Should be Subjected to AML/KYC Checks

The procedure of conducting UBO checks can be simplified, making it easy for compliance and legal departments. The onboarding process is lengthened due to the inefficiency of manual data screening. Re-screening and re-evaluation due to human error increases the time it takes to launch a company. In addition, employees need help with data entry rather than resolving sophisticated compliance issues.

UBO Law and Regulations 

EU UBO Requirements 

UBOs must be identified by EU financial institutions dealing with commercial clients. The 4th Anti-Money Laundering Directive (4AMLD) in the European Union was the first to mandate UBO identification, and other member states have since introduced enabling laws to enforce reporting obligations. For instance, the beneficial owners must be disclosed to Sweden’s Swedish Companies Registration Office. By Swedish law:

  • This applies to Swedish entities, foreign businesses in Sweden, and those who manage trusts and similar legal arrangements.
  • Beneficial owners can exercise majority voting authority over the board of directors or more than a 25% ownership share in the company.
  • Prescribes the reporting of any change in beneficial ownership as soon as the entity is made aware of the alteration in ownership.

Each EU member state has its laws; however, they must follow the 4AMLD. The 5th AML Directive mandated that member nations make registers of businesses, trusts, and other legal arrangements available to the public. 

EU’s 6th AML Directives expand the scope of criminal liability to include employees and officials of organizations as well as entities acting on their behalf. 

US UBO Requirements 

To ensure the same beneficial ownership disclosures are made in the United States, the Financial Crimes Enforcement Network (FinCEN) released the Customer Due Diligence final regulation on May 11, 2018.

FinCEN’s rule guidance states, “The CDD Rule establishes a new duty for certain banks, with certain caveats and exemptions: determining and confirming the identities of customers operating as legal entities.” 

Financial institutions are broadly defined in the rule to encompass such entities as futures commission merchants, commodity brokers, and mutual funds. Companies, partnerships, and business trusts are all legal entities that can be customers. According to the regulation, “beneficial owner” refers to those who own at least 25% of a company’s voting stock as well as have significant control over its management and daily operations. 

US businesses are required by the Corporate Transparency Act to provide FinCEN with the entire legal name, date of birth, current address, and identification number of the UBO.

International UBO Standards 

Disclosure of beneficial ownership is required under international agreements with other governments. Standards for beneficial ownership were first established in 2003 by the Financial Action Task Force (FATF), and in 2012, 198 governments agreed to adopt FATF guidelines. Two years later, at the G20 Brisbane Summit, a policy declaration highlighted UBO’s openness.

The declaration stated, “Legal entities’ beneficial ownership information should be readily available to government agencies (such as those in charge of law enforcement and prosecution, supervision, taxation, and financial intelligence) in a timely manner.”

According to a FATF assessment in 2016, only two of the G20 had substantially effective beneficial ownership regulations. While the FATF is committed to ensuring effective Beneficial Ownership transparency regulations are in place, it acknowledges its difficulty. A solution may be found using technologies and methods that expedite as well as enhance the process’s precision.

UBO Database and Technology Solution

Ultimate Beneficial Owners can be found with the help of several databases and technologies. Incorporating these ideas into an automated system helps speed up and improve the accuracy of the identification procedure. Examples of common approaches include: 

UBO Information Repositories

These databases collect information about UBOs from various sources, including business registrations and government documents. These databases are helpful since they make identifying the Ultimate Beneficial Owner easier and provide more details about them. 

KYC and AML Solutions 

Due diligence may be automated with KYC and AML systems, as can the identification and verification of UBOs. These solutions can also lessen the likelihood of financial crimes and help organizations comply with applicable legislation. 

Blockchain Technology

Blockchain technology may provide legally binding and verifiable property records. It can help firms keep track of UBOs by ensuring that ownership records are always up-to-date. It is crucial to find the correct technological answer for a company and ensure it abides by the necessary rules. 

UBO in Different Industries 

Identifying Ultimate Beneficial Owners is crucial in several sectors, including real estate, banking, and finance. With a better grasp of who gains from a transaction, financial crimes like money laundering can be avoided, and reputational harm can be avoided. 

Investigating potential partners or investors in these sectors is critical to verify they align with UBO rules and regulations.


Identifying UBOs is essential for maintaining openness, controlling risks, and meeting legal requirements. Businesses can lessen the likelihood of financial crimes, reputational damage, and monetary implications by learning who the Ultimate Beneficiary is. 

To guarantee Ultimate Beneficial Ownership laws and regulations verify the company, businesses must follow best practices, interact with regulators, and implement the required technological solutions. 

However, ‘The KYB’ offers advanced UBO verification to identify actual beneficial owners in real-time, ensuring regulatory compliance. Expedite UBO verification, simplify ownership insights, and adhere effortlessly to regulations. Uncover ownership percentages, discern significant control, and trace direct/indirect ownership. Explore entity relationships, and gain vital insights for ownership comprehension. Verify fund legitimacy, screen UBOs against global sanctions, visualize ownership structure for informed decisions, streamline due diligence, meet AML compliance, and mitigate risks. Elevate business operations with The KYB’s comprehensive solution.

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