The Financial Action Task Force (FATF) is the global money laundering and terrorist financing watchdog. The inter-governmental body sets international standards that aim to prevent these illegal activities and the harm they cause to society. As a policy-making body, the FATF works to generate the necessary political will to bring about national legislative and regulatory reforms in these areas.
With more than 200 countries and jurisdictions committed to implementing them. The FATF has developed the FATF Recommendations, or FATF Standards, which ensure a co-ordinated global response to prevent organised crime, corruption and terrorism. They help authorities go after the money of criminals dealing in illegal drugs, human trafficking and other crimes. The FATF also works to stop funding for weapons of mass destruction.
The FATF reviews money laundering and terrorist financing techniques and continuously strengthens its standards to address new risks, such as the regulation of virtual assets, which have spread as cryptocurrencies gain popularity. The FATF monitors countries to ensure they implement the FATF Standards fully and effectively, and holds countries to account that do not comply.
source :FATF
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- The Financial Action Task Force (FATF) retained Pakistan in the ‘greylist’ yet again. The FATF also announced the ‘greylisting’ of Jordan, Mali and Turkey, following the conclusion of the Plenary session.
- The FATF had issued the 27-point action plan after placing Pakistan on the ‘Grey List’ in June 2018. The action plan pertains to curbing money laundering and terror financing.
- During the October-2020 Plenary, due to the Covid-19 pandemic, Pakistan was given an extension for full compliance with the 27-point action plan till February 2021.
- It had then not fully complied with 6 of the 27 directives.
- In February 2021, FATF acknowledged Pakistan’s significant progress in combating terrorism, however it was still to fully comply with three of the 27-point action plan.
The three points pertained to effective steps in terms of financial sanctions and penalties against the terror funding infrastructure and the entities involved.
FATF Grey List
Countries that are considered safe haven for supporting terror funding and money laundering are put on the FATF grey list. This inclusion serves as a warning to the country that it may enter the blacklist.
Pakistan was retained in the grey list or list of countries under “increased monitoring” because it was unsuccessful in prosecuting the top leadership of UN Security Council-designated terror groups; the list includes Lashkar-e Toiba, Jaish-e Mohammad, Al Qaeda and the Taliban.
FATF Blacklist
Officially called the “Non-Cooperative Countries or Territories (NCCTs), the FATF Blacklist is a list of countries that the FATF considers to be non-cooperative in the international fight against terrorist financing and money laundering. This list is regularly updated, with countries being either deleted off the list or new countries being added to the list. It is to be noted that some names are on the list not because of their non-cooperative stance towards fighting this menace, but because they lack the necessary infrastructure and mechanisms to engage in this fight.
FATF Countries (FATF Members)
As of January 2021, there are 39 member countries in the FATF. India is a member of the organization since June 2010. It had earlier acquired ‘Observer’ status at FATF in 2006.
FATF Observer – Indonesia. There are many other Observer organizations and Associate Members.
Headquarters – Paris, France
Training Institute – Busan, Korea
No other regional offices.
Headquarters:
Its Secretariat is located at the Organisation for Economic Cooperation and Development (OECD) headquarters in Paris.
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