The Riffle
The Dubai Financial Services Authority (DFSA) has released a detailed Policy Statement clarifying how it assesses the fitness and propriety of Authorised Individuals under GEN Rule 7.6.5. Issued on 15 December 2025, the policy reinforces the DFSA’s holistic, case-by-case approach, confirming that the presence of adverse indicators does not automatically lead to rejection.
Instead, the DFSA evaluates individuals “in the round,” weighing all relevant factors across three core pillars: Integrity, Competence and Capability, and Financial Soundness. The policy offers valuable insight for Authorised Firms, Senior Executive Officers, MLROs, Compliance Officers, and Boards navigating approvals, notifications, and ongoing fitness assessments.
Key Highlights
1. A Context-Driven, Case-by-Case Assessment
Each fitness and propriety assessment is conducted individually, with all relevant circumstances considered together.
The identification of one or more issues does not automatically result in refusal.
Defined terms align with the DFSA Rulebook Glossary unless stated otherwise.
2. Integrity: The Most Extensive Pillar
The DFSA places significant weight on an individual’s conduct, character, and transparency, regardless of whether formal enforcement action occurred. Considerations include:
Criminal convictions (excluding minor traffic offences)
Disciplinary actions by regulators or professional bodies
Contraventions of financial services laws or codes of practice
Adverse civil findings relating to fraud, misfeasance, or misconduct
Dismissals or requests to resign from employment
Involvement with entities investigated for misconduct or that entered insolvency
Disqualification from directorships or management roles
Complaints relating to financial services
Public censure by regulators
Inclusion on UAE, UN, or other international sanctions lists
Candour and honesty in dealings with the DFSA
Integrity assessments extend beyond outcomes to include patterns of behaviour and governance judgment.
3. Competence and Capability
The DFSA assesses whether an individual can effectively perform their role, focusing on:
Adequate time commitment and capacity
Relevant knowledge, skills, and experience
Access to appropriate resources
Any complaints linked to competence in providing financial services
This reinforces expectations around role suitability, particularly for control functions and senior management.
4. Financial Soundness
An individual’s personal financial position is also relevant, with the DFSA considering:
Material indicators of poor credit history
Inability to manage personal finances responsibly
Bankruptcy, receivership, or administration
Unsatisfied judgment debts within the last 10 years, in the UAE or elsewhere
Financial soundness is assessed as part of overall risk, not in isolation.
Conclusion
The DFSA’s policy provides much-needed clarity on how fitness and propriety assessments are applied in practice. By confirming a non-mechanical, evidence-based approach, the regulator signals that transparency, governance judgment, and context matter as much as technical compliance.
For Authorised Firms, the message is clear: fitness and propriety is not a one-time approval exercise, but an ongoing obligation that must be actively monitored, documented, and reassessed throughout an individual’s tenure.
Next Steps for Firms
Review internal fitness and propriety frameworks to ensure alignment with the DFSA’s three-pillar approach
Strengthen ongoing monitoring and disclosure processes for Authorised Individuals
Ensure accurate, complete, and candid submissions in all DFSA interactions
Conduct periodic reassessments for senior management and control functions
