The FATF is a global organization that sets global standards to combat money laundering and terrorist financing (AML/CFT).
The Financial Action Task Force (FATF), also known by its French name, Group d’action financière (GAFI) is a global organization that sets global standards to combat money laundering and terrorist financing (AML/CFT). The FATF was formed in 1989 by the
G7. At the time of its inception, it had 16 members, but as of 2021, it has 39. In 2001, the FATF’s mandate was expanded to include terrorist financing following the 9/11 terrorist attacks.
The force is tasked with learning money laundering trends, monitoring legislative, financial, and law enforcement activities at both national and international levels, as well as reporting on compliance and issuing recommendations and standards to combat money laundering.
The
Forty Recommendations on Money Laundering and Nine Special Recommendations on Terror Financing of the FATF set the global standard for anti-money laundering and anti-terrorist financing on an individual level to allow each member state to implement them according to their own circumstances and constitutional framework.
In addition to the legally non-binding
40+9 Recommendations, FATF began issuing its
FATF Black List in 2010, officially called the list of Non-Cooperative Countries or Territories (NCCT). The list includes jurisdictions that were uncooperative in international money laundering and terrorist financing efforts.
This includes unwillingness to provide bank or brokerage account records, customer identification, and beneficial ownership information relating to these accounts, shell companies, and other financial entities commonly used to launder money.
In June 2019 FATF updated its Standards with its guidance
“A Risk-based Approach to Virtual Assets and Virtual Asset Service Providers (VASPs)”, which includes its so-called
FATF Travel Rule obligating exchanges to share compliant user information with each other. The FATF will convene in
late June 2021 and once again update its recommendations on crypto assets.