The Central Bank of the United Arab Emirates ordered a special and urgent examination of Banque Misr's Emirati branches on Saturday 29 August 2026, together with a lookback review of the transactions cited by Washington. The two central banks, Emirati and Egyptian, said the next day that they were coordinating. Both statements answer the proposed rule that the Financial Crimes Enforcement Network (FinCEN), the Treasury's anti-money laundering bureau, published on 28 August.
A measure that freezes nothing
The proposal rests on section 311 of the USA PATRIOT Act, codified at 31 U.S.C. 5318A. That provision lets the Treasury find a foreign financial institution to be of primary money laundering concern, then apply one of the five special measures the statute allows. FinCEN picked the fifth, the one that covers correspondent accounts. Its finding rests on an assessment that the five branches serve as a critical access node to the US dollar for Iranian illicit finance, with $520m of that activity in the most recent 12-month period. No assets are frozen and no one is added to an OFAC list.
- US financial institutions may not open or maintain a correspondent account for Banque Misr UAE;
- they must take reasonable steps not to process a transaction through a foreign bank's US correspondent account where that transaction involves Banque Misr UAE;
- they must apply special due diligence across all their foreign correspondent accounts to keep such transactions out.
FinCEN estimates that 128 US institutions may have to notify their correspondents, and notes that only three of them hold a direct account for Banque Misr UAE. Dollar access for five branches therefore rests on three banking relationships. The public comment period runs 30 days under docket FINCEN-2026-0232, ahead of a final rule that will set its own effective date.
The correspondent chain, and where the rule cuts it
A correspondent account is an account one bank holds on the books of another so that transactions can be executed where it has no presence of its own. The dollar settles finally only inside the US banking system, so any dollar transaction ends up touching an account held in the United States.
The second limb reaches the nested correspondent. A foreign bank holding a US account will no longer be able to route transactions involving Banque Misr UAE through it, and the US bank that holds the account will have to catch them with its sanctions screening.
Cairo's ring-fence, and its limit
The Central Bank of Egypt said the scope is confined to the Emirati branch's dollar business with its correspondents, leaving the other Banque Misr branches and the rest of the Egyptian banking sector untouched. The US proposal confirms that perimeter and expressly carves out the Egyptian parent and its operations outside the UAE. The Emirati central bank is weighing its options on the bank's status should the measure be imposed.
Legal scope and operational scope do not always line up. Screening systems work on character strings, and the five branches carry the parent's name. The special due diligence required across every foreign correspondent account pushes the check onto counterparties that cannot see FinCEN's non-public information.
A precedent where the effect came before the rule
ABLV Bank, a Latvian lender, faced a proposal of the same kind in February 2018, withdrawn in September 2024 with no final rule ever adopted. The withdrawal notice records that one week after the US filing, the European Central Bank saw an abrupt wave of deposit withdrawals and a growing loss of dollar funding at the bank. Section 311 precedents run from four months to more than twenty between the proposal and the final rule.
The size of the corridor
Remittances from Egyptians abroad reached about $43bn over the first eleven months of the 2025-2026 fiscal year, against about $33bn a year earlier, on Central Bank of Egypt figures reported by AGBI. The split puts the UAE behind Saudi Arabia. In 2023-2024, Kuwait, Saudi Arabia and the UAE together accounted for about $12bn out of roughly $26bn, of which about $8bn came from Saudi Arabia alone. The proposal targets neither those flows nor the channels that carry them. The Latvian precedent locates the risk in how counterparties react.