BACKGROUND

The first plenary session of the Financial Action Task Force (“FATF”) under the Presidency of Elisa de Anda Madrazo of Mexico concluded on October 25, 2024, attended by delegates from the over 200 jurisdictions.

A significant outcome of the plenary was an updated list of jurisdictions that are high-risk and should be subject to increased surveillance.

The FATF also discussed changes to standards related to cross-border payment systems and identified new risks in terrorist financing and proliferation financing. A project was initiated by FATF to review processes to prevent misuse of FATF requirements against Non-Profit Organizations (“NPO”).

Key Points

Strategic Initiatives

National Risk Assessment
A national risk assessment is key to a country being able to identify, assess, and understand the risks it faces so that it can direct its resources where it makes the greatest impact. 

The FATF has revised its guidance for a national money laundering risk assessment to reflect experiences and lessons it has learnt since 2013, when the guidance was first issued. The guidance will help countries, and in particular low-capacity countries, understand and mitigate their illicit finance risks. The guidance benefits from the experience of over 90 countries across the FATF Global Network facing different risks, challenges and at various levels of capacity.

Ongoing Work and New Projects
Delegates received updates on current efforts, including revisions to the FATF Standards to address the advancements in cross-border payment systems and shifts in industry standards, as well as progress on a thorough review of terrorist financing risks.

The FATF is undertaking a project aimed at detecting and preventing online child sexual exploitation, a crime that has seen a notable rise and affects the most vulnerable in society.

FATF’s new working projects include cooperation with data protection and privacy (“DPP”) experts, the private sector and other international partners on information sharing consistent with different national rules for Anti-Money Laundering (“AML”)/ Countering Terrorist Financing (“CFT”) and Proliferation of Weapons of Mass Destruction (“CPF”), and DPP.

FATF also commenced a project to review its processes to ensure that countries do not misuse the FATF requirements to restrict the activities of NPOs.

Black List

The Black List is a list of high-risk countries identified by the FATF, for which all members and jurisdictions are urged to apply enhanced due diligence and, in severe cases, countermeasures to mitigate money laundering, terrorist financing, and proliferation financing
risks.

The Black List remains unchanged

Grey List

The Grey List refers to jurisdictions under increased monitoring by the FATF due to strategic deficiencies in their regimes for countering money laundering, terrorist financing, and proliferation financing. These countries are actively working with the FATF to resolve the identified issues within agreed timeframes.

Senegal has been removed from the Grey List, while four countries have been added to the Grey List, which are Algeria, Angola, Côte d’Ivoire and Lebanon.

The Grey List consists of 24 jurisdictions.

WHAT’S NEXT?

Management should:

• Update the AML Risk Assessment and AML/CFT Policies and procedures for updated Black and Grey lists countries
• Review exposures to Non-Profits Organisations

And more…

HOW CAN WE HELP?

Contact Us today to discuss how we can conduct the audit function for you. Find out more here.