FATF
Definition
The Financial Action Task Force, an intergovernmental body founded in 1989 by the G7 that sets global standards for anti-money laundering and counter-terrorism financing and assesses compliance through mutual evaluations.
- Full name
- Financial Action Task Force
- Founded
- 1989, by the G7
- Type
- Intergovernmental standard-setting body
- Function
- Sets AML/CFT standards, assesses compliance via mutual evaluations
Common questions
What power does FATF actually have over non-compliant countries?+
FATF has no direct enforcement authority; its influence comes from its grey list and black list designations, which signal heightened money-laundering risk and can affect a country access to international banking and investment as other institutions adjust their own risk assessments accordingly.
How do FATF mutual evaluations work?+
Teams of assessors from other member countries review a jurisdiction's laws, institutions, and actual enforcement practice against the FATF Recommendations, producing a public report that rates technical compliance and effectiveness rather than relying on the country's own self-assessment.
Related terms
- 40 Recommendations
- FATF's core normative standards, covering customer due diligence, suspicious transaction reporting, beneficial ownership, targeted financial sanctions, and international cooperation. Last substantially revised...
- Designated Non-Financial Businesses and Professions (DNFBPs)
- Non-bank sectors required under FATF standards to apply AML controls, including real estate agents, lawyers, accountants, trust and company service providers, and...
- Egmont Group
- An international network of 166 financial intelligence units (FIUs) that share financial intelligence through a secure system. FIUs are the operational channel...
- Grey List
- The FATF Jurisdictions Under Increased Monitoring list, identifying countries with strategic deficiencies that have committed to a remediation action plan. Inclusion increases...
- Mutual Evaluation
- A peer review of a country's AML and CTF system by a team of experts from other FATF members, assessing both technical...