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IMF Plays Key Role in Shaping Global AML/CFT Policies
The International Monetary Fund (IMF) has been a driving force behind anti-money laundering and combating the financing of terrorism (AML/CFT) policies worldwide for over two decades. The organization’s extensive work on financial integrity issues is critical to preventing and combating money laundering, terrorist financing, and other related crimes.
AML/CFT Policies Crucial to Global Financial System
Money laundering and terrorist financing pose significant threats to the stability of national economies and the international financial system as a whole. These crimes can lead to:
- Destabilizing “hot money” inflows and outflows
- Banking crises
- Ineffective revenue collection
- Broader governance weaknesses
- Reputational risks for international financial centers
- Loss of correspondent banking relationships
IMF’s AML/CFT Strategy Focuses on Macroeconomic Impacts
The IMF’s 2023 Review of the AML/CFT Strategy emphasizes the need to address the macroeconomic impacts of money laundering, related financial crimes, and terrorism financing. The review found that the current principles of engagement are broadly appropriate, but an enhanced focus is required on the adverse effects these crimes have on national economies.
IMF’s Work on AML/CFT Global Architecture
The IMF actively contributes to the global AML/CFT architecture through participation in standard-setting bodies and assessments of countries against international standards. The organization also delivers bilateral, regional, and thematic technical assistance to its member countries to help them implement effective AML/CFT measures.
IMF’s Capacity Development Program on AML/CFT
The IMF has an extensive capacity development program on AML/CFT that provides training and technical assistance to countries to strengthen their financial integrity. The program focuses on building the skills of national authorities, supervisors, and regulators to effectively prevent and combat money laundering and terrorist financing.
Civil Society Organizations Support IMF’s AML/CFT Work
A survey conducted by the IMF among civil society organizations (CSOs) around the world found that they are generally satisfied with the Fund’s AML/CFT work. However, CSOs emphasized the need for:
- Increased focus on illicit financial flows and their impacts
- Emphasis on beneficial ownership transparency efforts
- Greater attention to AML/CFT weaknesses in advanced economies
IMF Continues to Enhance its Engagement with Civil Society Organizations
The IMF has launched a public consultation on how it can further enhance its engagement with civil society organizations. The Fund aims to strengthen its collaboration with CSOs to address financial integrity issues and prevent money laundering, terrorist financing, and other related crimes.
Conclusion
The IMF’s continued efforts to shape global AML/CFT policies are crucial to preventing and combating the threats posed by these crimes.