FATF

The Financial Action Task Force (FATF) was established in 1989 by the G7 at its Paris summit, originally to coordinate responses to money laundering linked to the drug trade. Its mandate was expanded after the September 11, 2001 attacks to include countering the financing of terrorism (CFT), and later broadened again to cover proliferation financing tied to weapons of mass destruction.

FATF is headquartered at the OECD in Paris, though it is a standalone intergovernmental body and not a UN organ. It currently has 40 members, including most major economies and two regional organisations (the European Commission and the Gulf Cooperation Council). A network of FATF-Style Regional Bodies (FSRBs), such as MONEYVAL, APG, and GAFILAT, extends its reach to roughly 200 jurisdictions.

Its core output is the FATF Recommendations (commonly called the "40 Recommendations"), first issued in 1990 and most recently consolidated in 2012 with ongoing updates. These cover customer due diligence, beneficial ownership transparency, suspicious transaction reporting, and sanctions implementation, particularly under UN Security Council resolutions on terrorism and proliferation (e.g., UNSCR 1267 and 1373).

FATF conducts mutual evaluations assessing both technical compliance and effectiveness. Jurisdictions with strategic deficiencies may be placed on two public lists:

• The "grey list" (Jurisdictions under Increased Monitoring), requiring an action plan.
• The "black list" (High-Risk Jurisdictions subject to a Call for Action), which currently names the DPRK, Iran, and Myanmar.

Although FATF standards are non-binding in formal international law, listings carry significant reputational and financial consequences, often triggering enhanced due diligence by global banks, reduced correspondent banking access, and IMF or World Bank scrutiny. The presidency rotates annually among members.