FATF
FATFAlso called financial Action Task Force, GAFI
The Financial Action Task Force is the intergovernmental body that sets global standards against money laundering, terrorist financing and proliferation financing. Founded by the G7 in 1989 and based in Paris, it publishes the FATF Recommendations, assesses countries through mutual evaluations and lists jurisdictions with strategic deficiencies, known as the grey and black lists.
How it works
FATF members agree standards at plenary meetings held three times a year. National governments turn those standards into law, which is how FATF rules reach banks and other firms through local AML regulations. Peer reviews called mutual evaluations rate each country on technical compliance and effectiveness. Countries with serious gaps are placed under increased monitoring until they complete an action plan.
For regulated firms, FATF lists feed directly into country risk ratings, enhanced due diligence and transaction monitoring. A grey-listing raises the cost of doing business with a jurisdiction, and UK and EU rules require enhanced checks for high-risk third countries. FATF guidance on topics such as virtual assets, beneficial ownership and the risk-based approach shapes supervisors' expectations well before national rules change.
The rules
Forty Recommendations covering risk assessment, preventive measures, beneficial ownership, supervision, FIUs and international cooperation; updated regularly since adoption.
FATF members and FATF-style regional body membersRevised to require countries to ensure adequate, accurate and up-to-date beneficial ownership information on companies, including through a register or alternative mechanism.
FATF member jurisdictionsCommon questions
Is the FATF a regulator?
No. The FATF has no direct power over firms. It sets standards that member countries implement in national law, and it assesses whether they do so. Regulators then enforce those national rules on banks and other firms.
What is the FATF grey list?
It is the FATF list of jurisdictions under increased monitoring. Countries on it have committed to fix strategic AML weaknesses within agreed timeframes. Many firms raise their country risk rating for listed jurisdictions.
How often does the FATF meet?
The FATF holds three plenary meetings a year, usually in February, June and October. Updates to its lists of high-risk and monitored jurisdictions are published at the end of each plenary.
What are FATF-style regional bodies?
They are regional groups that apply FATF standards and run mutual evaluations for countries that are not FATF members. Together with FATF members they cover more than 200 jurisdictions.
