DUBAI--Standard Chartered may face legal action in the United Arab Emirates brought by clients whose accounts will be closed by the bank after it was slapped with a $300 million fine related to alleged lapses in anti-money-laundering controls, the U.A.E. Central Bank said Thursday.

Standard Chartered's settlement with the New York state regulator, announced Tuesday, required among other things that the bank improve its monitoring of certain small and medium-size business relationships at its U.A.E. locations. The U.A.E. central bank estimates between 1,400 and 8,000 clients could be affected.

The central bank said Standard Chartered was liable to legal action because of the "material and moral damage" company owners may suffer as a result of having their accounts closed. It said its consumer protection unit is ready to receive and consider complaints from the bank's affected customers.

"We have noted the announcement made by the U.A.E. central bank. We always work with our regulators to achieve the right outcomes," a Standard Chartered spokesman in London said.

Earlier this week, Standard Chartered said the bank was already seeking to reduce its SME activities in the U.A.E. as part of a broader strategic overhaul and remains committed to the country, the group's fifth-largest revenue contributor.

Write to Nicolas Parasie at nicolas.parasie@wsj.com

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