The Dubai Financial Services Authority (DFSA) said it has accepted an Enforceable Undertaking from United Investment Bank (UIB), a Dubai International Financial Centre (DIFC) authorised firm.

The UIB agreed to pay a financial penalty of Dh183,500 ($50,000) to the DFSA; and to not provide custody to any persons until it had implemented measures including remedying its systems and controls to the satisfaction of the authority.

The Enforceable Undertaking resulted from a DFSA investigation into the manner in which UIB was providing custody. During 2012, UIB was contracted to provide custodian services for six funds, said a statement from DFSA.

The investigation found that UIB did not maintain adequate systems and controls to comply with DFSA’s safe custody requirements.

It also revealed that the corporate governance deficiencies had prevented UIB’s management from acting in the best interest of the firm; and that for one of its funds, UIB had failed to provide any custodian services even though it was contracted to do so and was identified as the fund’s custodian in the fund’s offering memorandum, the DFSA statement added.-TradeArabia News Service