FATF Recommendations
Definition
The 40 international standards issued by the Financial Action Task Force that set out the measures countries should implement to prevent money laundering, terrorist financing, and proliferation financing. First issued in 1990, substantially revised in 2012, and updated periodically. The primary benchmark for AML compliance assessments worldwide.
- Count
- 40 standards
- First issued
- 1990
- Major revision
- 2012
- Scope
- Money laundering, terrorist financing, proliferation financing
Common questions
How do the FATF Recommendations differ from FATF itself as a body?+
FATF is the organisation; the Recommendations are the actual technical standard it publishes, covering areas such as customer due diligence, beneficial ownership transparency, suspicious transaction reporting, and international cooperation, which member and non-member jurisdictions are assessed against.
Why does the 2012 revision matter for current AML practice?+
That revision folded in the counter-proliferation financing requirements and sharpened the beneficial ownership and risk-based approach provisions, so audits and compliance programmes built only on the pre-2012 text miss requirements regulators now actively assess against.
Related terms
- Beneficial Ownership
- The natural person(s) who ultimately own or control a legal entity or arrangement, or on whose behalf a transaction is conducted. FATF...
- Customer Due Diligence (CDD)
- The process of identifying and verifying the identity of a customer and their beneficial owner, understanding the purpose of the business relationship,...
- Mutual Evaluation Report (MER)
- An assessment of a country's compliance with the FATF Recommendations, conducted by FATF-style regional bodies or by FATF itself. Published publicly. Identifies...
- Suspicious Activity Report (SAR)
- A disclosure filed with the financial intelligence unit when a reporting entity knows, suspects, or has reasonable grounds to suspect that a...
- Transaction Monitoring System (TMS)
- An automated system that screens transaction data against a library of typologies and thresholds to generate alerts for potential money laundering. A...