Know the Global Bodies & Norms
- Financial Action Task Force
- FATF Style Regional Bodies (FSRBs)
- FATF Recommendations
- FATF Guidance – Private Sector Information Sharing
- Money Laundering National Risk Assessment Guidance
- Terrorist Financing Risk Assessment Guidance
- Egmont Group
- Basel Committee on Banking Supervision
- Wolfsberg Group
- UNODC’S SHERLOC
- FATCA (USA)
- Common Reporting Standards (CRA)
- UNSC Sanctions
- OFAC Sanctions (USA)
- UK Sanctions
- EU Sanctions
- Singapore Sanctions
1. Financial Action Task Force (FATF)
(https://www.fatf-gafi.org)
- Inter-governmental body – established in 1989 – global ML and TF watchdog
- Has 40 members and 9 Associate members
- Monitors how criminals and terrorists raise, use and move funds
- Evolved measures for mitigating ML/TF/PF risks
- Regularly publishes reports that raise awareness
- Monitors countries to ensure they implement the FATF Standards
2. FATF Style Regional Bodies (FSRBs)
- Nine Regional Bodies linked to FATF as Associate Members
- Cover various Regional Jurisdictions for supporting FATF
- Global Network – 200 governments and 20 observer organisations
- Undertake research on regional ML/TF risks
- Undertakes evaluation of implementation by member countries
3. FATF Recommendations
Comprehensive and consistent framework of measures for AML/CFT/CPF, also known as ‘FATF Standards’ comprise of Recommendations, Interpretive Notes, and Glossary
Revised version was adopted in February 2012 and last updated in November 2023
The list of Recommendations is as follows-
4. FATF Guidance - Private Sector Information Sharing
(https://www.fatf-gafi.org/en/publications/Fatfgeneral/Guidance-information-sharing.html)
- Sharing of information on ML/TF crucial
- Number of legal constraints and operational challenges
- Aims to improve effective information sharing
5. Money Laundering National Risk Assessment Guidance
- Supports countries in conducting an NRA for ML risk
- Covers following aspects:
- NRA Preparation and Setup
- Assessing and Understanding Money Laundering Risks
- Post-NRA Actions
6. Terrorist Financing Risk Assessment Guidance
- Challenges in assessing TF risks due to low value of transactions
- Provides relevant information sources and considerations for different country contexts
7. Egmont Group
(https://egmontgroup.org/)
- Helps FIUs work together
- Prompts exchange of information, knowledge, and cooperation
- Platform to securely exchange expertise and financial intelligence
8. Basel Committee on Banking Supervision
(https://www.bis.org/bcbs/index.htm)
- Primary global standard setter for regulation of banks
- Forum for regular cooperation on banking supervisory matters
- Members: Central banks and bank supervisors from 28 jurisdictions
- Published guidelines and standards on various aspects for bank management and supervision
Publications current related to AML –
(a) Sound management of risks related to money laundering and financing of terrorism: revisions to supervisory cooperation
(https://www.bis.org/bcbs/publ/d505.htm)
- Provides guidance to banks and bank supervisors
- For implementation of FATF Standards
- Covers the following aspects:
– Essential elements of ML/TF risk management
– AML/CFT in group-wide and cross-border context
– Role of supervisors
(b) Due diligence and transparency regarding cover payment messages related to cross-border wire transfers
(https://www.bis.org/publ/bcbs154.htm)
(c) Initiatives by the BCBS, IAIS and IOSCO to combat money laundering and the financing of terrorism – Update
(https://www.bis.org/publ/joint11.htm)
(d) Sharing of financial records between jurisdictions in connection with the fight against terrorist financing
(https://www.bis.org/publ/bcbs89.htm)
9. Wolfsberg Group
(https://wolfsberg-group.org/)
- Association of 12 global banks
- Aims to develop guidance for management of financial crime risks
- Works through various Working Groups
- Published several documents around Financial Crime Compliance issues
10. UNODC’S SHERLOC
- Sharing Electronic Resources and Laws on Crime
(https://sherloc.unodc.org/) - Knowledge management portal of UNODC
- To facilitate dissemination of information
- Offers a wide range of content regarding AML and CFT
11. FATCA (USA)
(https://www.irs.gov/businesses/corporations/foreign-account-tax-compliance-act-fatca)
- Foreign Account Tax Compliance Act (FATCA) – a US Law
- Has extra-terrestrial implications
- Requires foreign financial Institutions and certain other non-financial foreign entities report assets held with them by persons taxable under US laws
- Else these entities be subject to withholding on withholdable payments
12. Common Reporting Standards (CRA)
- Global standard for exchanging financial account information between tax authorities
- OECD) developed the CRS in 2014 to help fight tax evasion
- Applies to countries that have committed to the standard
- Covers: Bank accounts, Brokerage accounts, Life insurance, Annuities
13. UNSC Sanctions
(https://main.un.org/securitycouncil/en/sanctions/information)
- UNSC can take action to maintain or restore international peace and security under Chapter VII of the United Nations Charter
- Sanctions measures cover broad range of enforcement options – not involving use of armed force
- Currently, 14 ongoing sanctions regimes covering several countries and terrorist organisations
Measures include:
- Comprehensive economic and trade sanctions
- Targeted measures (arms embargoes, travel bans, and financial or commodity restrictions)
14. OFAC Sanctions (USA)
(https://ofac.treasury.gov/sanctions-programs-and-country-information)
OFAC – Office of Foreign Assets Control
- Administers several sanctions programs (either comprehensive or selective)
- Blocks assets and imposes trade restrictions
- Objective is to achieve national security goals
15. UK Sanctions
(https://www.gov.uk/guidance/uk-sanctions)
UK Sanctions basis:
- Complying with UN and other international obligations
- Supporting foreign policy and national security
- Maintaining international peace and security
- Preventing terrorism
- Issued under the Sanctions and Anti-Money Laundering Act 2018 (the Sanctions Act)
- Apply to conduct by UK persons
16. EU Sanctions
(https://www.eeas.europa.eu/eeas/european-union-sanctions_en)
Tool under the Common Foreign and Security Policy (CFSP)
- To uphold international law
- To prevent international crises
- To support conflict resolution
- To fight terrorism
- To tackle proliferation of weapons
17. Singapore Sanctions
(https://www.mas.gov.sg/regulation/anti-money-laundering/targeted-financial-sanctions)
- Implements UNSCRs on sanctions
- Through the Financial Services and Markets Regulations
- Also imposes sanctions on terrorists under Terrorism (Suppression of Financing) Act pursuant to UNSCR 1373
(https://www.mha.gov.sg/what-we-do/managing-security-threats/countering-the-financing-of-terrorism)