Policy Issues • Terrorism and Illicit Finance
Financial Action Task Force (FATF)
The Financial Action Task Force (FATF) is an international body that sets standards and promotes effective implementation of legal, regulatory, and operational measures to combat money laundering, terrorist financing, and related threats.
How FATF Work Is Commonly Used
- Standards: FATF recommendations provide a shared baseline for AML/CFT regimes.
- Assessments: mutual evaluations review how countries implement standards.
- Typologies: reports summarize emerging risks and common laundering methods.
Key Ideas in FATF-Aligned Programs
Risk-Based Approach
- Identify risk: understand exposures by product, customer type, geography, and channel.
- Apply controls: stronger controls where risk is higher.
- Monitor and improve: update controls as risks and typologies change.
Why It Matters
- Promotes cross-border consistency in financial crime controls.
- Improves information sharing and coordination across jurisdictions.
- Supports stronger defenses against illicit finance networks.
Official Resource
FATF publishes recommendations, evaluations, and reports. Visit fatf-gafi.org for official materials.