FINES FOR VIOLATIONS (VARA)
What VARA can fine — and how much: indicative fine bands for entities and individuals, when they apply, how VARA decides, and what happens if you don’t pay.
We build inspection-ready controls (AML/CFT, market conduct, disclosures, client-asset protection) to prevent breaches that trigger Schedule 3 fines — and we draft escalation/notification playbooks if an incident occurs.
AT-A-GLANCE — VARA’S FINING POWER
Sole discretion
Sole and absolute discretion
Sole discretion: VARA has sole and absolute discretion to issue fines and determine amounts.
Amounts
How amounts are set
How amounts are set: the table of indicative fines applies, but VARA sets final amounts in line with applicable local/federal laws (incl. Cabinet Resolution No. 99 of 2024) and VARA’s assessment of relevant factors under Reg. IX.C. Fines are exclusive of any other authority/court penalties.
Update bands
VARA can update bands
VARA can update bands any time (including new categories) via amendments or Directive.
CORE RULE: WHO MAY MARKET
VA ACTIVITIES
|
Violation (illustrative summary) |
Indicative fine amount |
|---|---|
|
AML/CFT & KYC/CDD breaches |
Determined under applicable local/federal laws (VARA applies those frameworks). |
|
Other CRM (non-AML) / Market Conduct breaches OR Market Offences (e.g., insider dealing, manipulation) |
Individuals: up to the higher of AED 20,000,000 or 200% of profits gained / losses avoided. Corporate Entities: up to the higher of AED 50,000,000, 15% of annual revenue, or 300% of profits gained / losses avoided. |
|
All other breaches of Regulations/Rules/Directives not captured above |
Amount set by VARA under Schedule 3/Reg. IX.C after weighing the statutory factors. |
Note: Non-payment = automatic surcharge: if a fine is not paid within VARA’s timeframe, a further fine accrues at 1% per month, compounding (rounded up to the nearest full month), until all amounts are paid. VARA may also take additional enforcement action and/or refer to law enforcement/competent courts.
COMMON GROUNDS FOR ISSUANCE
(ILLUSTRATIVE, NON-EXHAUSTIVE)
|
Unauthorised activity: carrying out a VA Activity without a VARA licence. |
|
Unauthorised issuance: issuing a VA in breach of Reg. II.A.1. |
|
Failure to register where mandatory registration applies. |
|
Misrepresentation: claiming a relationship with VARA or the ability to influence/accelerate licensing (incl. breaches of Reg. X). |
|
UBO disclosure violations under Regulations/Rules/Directives. |
HOW VARA ASSESSES FINES FOR INDIVIDUALS
When considering whether to fine an individual, VARA may weigh, at its discretion:
- Materiality & severity of the underlying violation (incl. one committed by the employing Entity).
- Whether the individual adequately managed their responsibilities as set out in the Rulebooks.
- Whether they acted reasonably under internal policies — or with wilful negligence of duties.
- Additional factors in Reg. IX.C.4 and any other relevant considerations.
WHAT THIS MEANS FOR YOUR GOVERNANCE
Expect entity-level and individual exposure on the same incident (e.g., market-offence + conduct controls failure).
Profit-based multipliers (200% / 300%) and revenue-based caps (15%) mean weak controls can become balance-sheet events.
Compounding surcharges make payment discipline a core finance control
OUR PROCESS (FAST & REGULATOR-READY)
Prevention
Uplift AML/CFT (≤3-month RAs), Market Conduct (client agreements, complaints SLA, investor gating), Client Money/VA 1:1, disclosures.
Detection
Surveillance & alerting, insider-list/positions workflows, VA Standards reassessment cadence.
Response
Reg. IX.C-aligned incident playbooks, VARA notification packs, and payment/governance procedures that avoid 1% compounding traps.
FAQs
Yes — by amending the Regulations/Marketing Regulations or via Directive.
No — Schedule 3 fines are exclusive of any other competent-authority or court penalties.
Expect 1%/month compounding and possible further enforcement or court referral.
Up to the higher of AED 20m (individual) / AED 50m (corporate), or profit-based multipliers (200% / 300%) and 15% revenue for corporations.