FATF Recommendations in Palestinian Territory, Occupied: A Mixed Picture

The Financial Action Task Force (FATF) has released its latest report on the implementation of anti-money laundering and combating the financing of terrorism (AML/CFT) measures in the Palestinian Territory, occupied by Israel. The report assesses the territory’s compliance with 40 key recommendations aimed at preventing financial crimes.

Progress Made

According to the report, the Palestinian Authority has made significant progress in implementing several FATF recommendations, including:

• National cooperation and coordination (R.2)
• Money laundering offence (R.3)
• Terrorist financing offence (R.5)

Areas for Improvement

However, the report also highlights areas where the territory needs improvement, such as:

• Failure to fully implement measures to prevent money or value transfer services from being used for terrorism financing (R.14)
• Lack of transparency in beneficial ownership of legal persons and arrangements (R.24 and R.25)

Challenges Remain

The report also notes that the Palestinian Authority has struggled to implement recommendations related to:

• Non-profit organisations (R.8)
• Financial institution secrecy laws (R.9)
• Regulation and supervision of DNFBPs (R.28)

FATF Ratings

In terms of ratings, the FATF has classified the Palestinian Territory as “partially compliant” with 14 out of the 40 recommendations, meaning that it has implemented some but not all of the required measures. The territory was found to be:

• “Largely compliant” with six recommendations
• “Non-compliant” with five others

Implications and Next Steps

The report’s findings are likely to be a concern for international efforts to combat financial crimes in the region. The FATF will continue to monitor the Palestinian Authority’s progress in implementing these recommendations and may consider re-evaluating its membership status if significant improvements are not made.

Note: R. stands for Recommendation number.