Global Anti-Money Laundering and Terrorist Financing Efforts Take Significant Leap Forward
The Financial Action Task Force (FATF) has made a major milestone in international cooperation by revising its standards to combat money laundering and terrorist financing more effectively.
Effective Implementation of Technical Requirements
For the first time, countries will be evaluated not just on whether they have the necessary laws and regulations in place, but also on how well those laws are enforced and used to combat money laundering and terrorist financing. The revised standards focus on several key themes:
- Policy Coordination: Ensuring that various government agencies and private sector entities work together holistically to achieve common goals.
- Effective Implementation: Countries will be expected to detect and disrupt threats, deprive terrorists of resources, and sanction those who finance terrorism.
New Measures to Combat Terrorist Financing
The revised standards introduce new measures to combat terrorist financing, including:
- Criminal Offenses: Making it a criminal offense to finance terrorism.
- Targeted Financial Sanctions: Implementing targeted financial sanctions against individuals and organizations involved in terrorist financing.
- Safeguards for Non-Profit Sector: Specific safeguards are applied to the non-profit sector, which has been vulnerable to misuse by terrorists.
Other Key Changes
Other key changes include:
- Consistent Implementation of UN Measures: Ensuring consistent and effective implementation of United Nations (UN) measures.
- Preventive Measures at Points of Entry: Implementing preventive measures at points of entry to the financial system.
- Increased Stringency in Identifying and Transparency of Legal Persons and Arrangements: Increasing stringency in identifying and transparency of legal persons and arrangements.
International Cooperation
The FATF’s international cooperation requirements have been expanded to facilitate cross-border investigations and prosecutions. This includes:
- Mutual Legal Assistance: Providing a suite of tools, such as mutual legal assistance, information sharing, and joint investigations, to combat money laundering and terrorist financing.
- Information Sharing: Sharing information between countries to prevent and detect money laundering and terrorist financing.
Implementation and Evaluation
The revised standards are the result of lengthy discussions, consultations, and negotiations with member countries, which have committed themselves to implementing these measures and undergoing evaluation by the FATF. The successful implementation of these standards will be closely monitored and followed up on by the FATF to ensure that countries address any deficiencies identified during the evaluation process.