We take a look at the Ministerial Declaration from the FATF (Financial Action Task Force) biennial sitting and their agreed upon stances as they relate to the global issues of money laundering, terrorist financing and financing of proliferation of weapons of mass destruction.
Take a look at the key statements, commitments and what you should care about below.
- Illegal financial flows erode the integrity of the international financial system and undermine sustainable and inclusive growth
- The FATF remains resolved in the pursuit of the full and effective implementation of the FATF Standards worldwide, to continue to ensure jurisdictions implement the FATF Standards adequately and encourage action to protect the international financial system, while working with countries – FATF or not – to address their deficiencies.
- Expresses its deepest sympathies with the people of Ukraine, reaffirming that the ongoing Russian invasion represents a gross violation of the commitment upon which FATF Ministers agree to implement and support the FATF Standards
- Note: The Russian Federation is a member of the FATF
- Recognise the serious impact of grand and systemic corruption on our economies and societies
- We commit to effectively implementing the United Nations Convention Against Corruption and to do more within the scope of its mandate in close cooperation with international bodies incl. the OECD Working Group on Bribery and the G20 Anti-corruption Working Group
- Pursue work on the misuse of citizenship by investment schemes and conduct a workshop with investigators, prosecutors and judges to discuss how best to investigate and prosecute complicit financial service providers that are facilitating corrupt actors
- Despite significant progress in many areas, not all countries are yet to achieve effectiveness of the measures to fight money laundering, terrorist financing and proliferation financing
- To remedy significant technical compliance deficiencies during the next round of FATF Mutual Evaluations.
- Strengthen the FATF Global Network (the FATF and nine FATF-Style Regional Bodies) comprising more than 200 governments and 20 observer international organisations
- FATF System of Mutual Evaluations including the review of jurisdictions with strategic deficiencies
- Enhance International Beneficial Ownership Transparency to address the concealment of financial flows and their beneficial owners through complex and opaque legal structures and strengthened FATF Standards on the beneficial ownership of legal persons, which include establishment of beneficial ownership registries
- Increase Capabilities to more Effectively Recover Criminal Assets by spearheading the creation of an effective system to deprive criminals of their proceeds, root out criminal activity, and protect the financial system
- Leverage Digital Transformation to reshape our economies and societies, continue to anticipate new risks from this field (incl. ransomware and other forms of cybercrime) and delivery new channels for financial services
- Ensure Sustainable Funding for FATF Strategic Priorities to support to fulfil its mandate
What Australia should care about
- The FATF are preparing for their next round of Mutual Evaluations. During the last round (2015) Australia were found to be non-compliant or partially compliant in 16 of 40 assessed areas. To combat this the government must look to:
1. Implement Tranche II of the AML legislation.
2. Fulfil The Senate recommendation to review and implement a beneficial ownership register (or similar).
3. Expand the power and resources of government bodies (at present only AUSTRAC) to combat money laundering, terrorist financing and financing of the proliferation of weapons of mass destruction.
- The statement “grand and systemic corruption of our economies and societies” must be taken to heart. The Australian Government claims to offer everyday Aussies a “fair go” but by not regulating the inflow of dirty money through legal, accounting and most impactfully the real estate sector they are hurting Australians and at the same time devaluing our standing as a trusted economy on the global stage.
About First AML
First AML is an AML technology provider, and the maker of Source, an all-in-one AML platform. Source powers thousands of compliance experts around the globe to reduce the time and cost burden of complex and international entity KYC. Its enterprise-wide, long term approach to the KYC / CDD data lifecycle addresses time and cost challenges while minimising compliance, reputational and security risks.