FATF

Context:

  • The global financial crime watchdog Financial Action Task Force (FATF) in its latest plenary meeting, decided to retain Pakistan on its terror financing ‘grey list’, asking the neighbouring country to expeditiously address the remaining deficiencies in its financial system.

 

About:

  • An inter-governmental body established in 1989 during the G7 Summit in Paris.
  • Assesses the strength of a country’s anti-money laundering and anti-terror financing frameworks, however it does not go by individual cases.

 

Objectives:

  • To set standards and promote effective implementation of legal, regulatory and operational measures for combating money laundering, terrorist financing and other related threats to the integrity of the international financial system.

 

Headquarters:
  • Its Secretariat is located at the  OECD headquarters in Paris.

 

Member Countries:
  • The FATF currently has 39 members including two regional organizations – the European Commission and Gulf Cooperation Council. 
  • India is a member of the FATF.

 

Lists under FATF:
Grey List:
  • Countries that are considered safe haven for supporting terror funding and money laundering are put in the FATF grey list.
  • This inclusion serves as a warning to the country that it may enter the blacklist.

 

Black List:
  • Countries known as Non-Cooperative Countries or Territories (NCCTs) are put in the blacklist. These countries support terror funding and money laundering activities.
  • The FATF revises the blacklist regularly, adding or deleting entries.
  • Currently, Iran and Democratic People’s Republic of Korea (DPRK)are under High-risk Jurisdiction or black list.

Source: THE HINDU

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