What does the UAE law say about unlicensed fundraising?
Article 41 of the Federal Decree-Law No. 34 of 2021 (Cybercrimes Law) punishes whoever calls for or promotes a contest or electronic currency, or creates or manages a fictitious portfolio or company, with the intention of receiving or raising funds from the public for investing, managing, employing or increasing those funds without a licence from the authorities concerned.
The penalty is imprisonment of not more than five years and/or a fine of AED 250,000 to AED 1,000,000, and the court orders the refund of the illegally seized funds.
Is a Ponzi scheme a separate offence?
There is no offence named Ponzi scheme in these laws. Such schemes are prosecuted under fraud (Article 451 of the Crimes and Penalties Law), under Article 41 of the Cybercrimes Law where the scheme runs online, and under the law on proceeds of crime.
The prosecution will look at how investors were solicited, what was promised, where the money went and whether new money was used to pay earlier investors.
What about investors who are accused?
Investors and promoters are treated differently. A person who invested and lost money is a victim. A person who recruited others, handled funds or promoted the scheme can face allegations.
The question for the defence is what the person knew, what they were told and what they were paid.
What can the defence do?
Show that the scheme was licensed or that you were not the one raising funds, that you had no intent to deceive, or that your role was limited.
Records of the licence, agreements, marketing and the flow of funds decide these cases.
What should I do first?
Stop moving money
Do not transfer, withdraw or hide funds.
Collect your agreements and statements
Everything you signed, received or sent.
List your role clearly
Investor, promoter, administrator or agent.
Take advice before speaking to authorities
Roles matter greatly.
Call us on +971 50 653 1334 or message us on WhatsApp. We answer at any hour.
Frequently asked questions
Is raising money from the public without a licence a crime?
Yes, Article 41 of the Cybercrimes Law punishes it with imprisonment of up to five years and/or a fine of AED 250,000 to AED 1,000,000.
What happens to the money?
The court orders the refund of illegally seized funds (Article 41).
Is every failed investment a crime?
No. A loss is not a crime. Deception or unlicensed fundraising is the issue.
Is there a separate Ponzi offence?
Not by name. Schemes are charged under fraud and unlicensed fundraising provisions.
Related guides
Financial Crime overview
The main points, the process and your first steps.
Read the overviewCrypto Fraud
How the UAE's cybercrime law treats crypto and online investment scams, fake websites and impersonation.
Read the guideFraud
How the Crimes and Penalties Law defines fraud, what must be proved, and how a commercial dispute is separated from a crime.
Read the guideSources
Source: Federal Decree-Law No. 31 of 2021 (Crimes and Penalties Law), official English text on the UAE Legislation portal, checked 9 October 2026. The portal lists the law as active and last updated on 7 September 2026. The Arabic text prevails over translations. Source: Federal Decree-Law No. 34 of 2021 (Countering Rumours and Cybercrimes), official English text on the UAE Legislation portal, checked 9 October 2026. The portal lists the law as active and last updated on 4 April 2024, with one amendment. The Arabic text prevails over translations.
This page is general information, not legal advice.