02 Jul 2020
The global watchdog against money laundering and terrorist financing is seeking input on how to prevent the spread of weapons of mass destruction as Germany assumes its two-year presidency of the organization.
In an announcement following the final plenary meeting under Chinese President Xiangmin Liu, the Financial Action Task Force (FATF) disclosed potential revisions to guidance that would require nations, financial institutions and other businesses to more closely scrutinize jurisdictions and entities for proliferation financing risks tied to targeted sanctions.
Under the amendments, countries would be tasked with identifying and assessing the proliferation financing risks of other jurisdictions on an ongoing basis, assisting competent authorities with addressing such risks and informing financial institutions and other designated businesses of their findings.
Banks and other covered firms would likewise be required to take steps to mitigate sanctions-related proliferation vulnerabilities through “policies, controls and procedures… approved by senior management,” FATF said in the consultation paper.
The Paris-based intergovernmental group separately noted progress made by virtual asset service providers (VASPs) in implementing its anti-money laundering and counterterrorist financing recommendations.
FATF’s new president, Marcus Pleyer of Germany’s Federal Ministry of Finance, begins his term on Wednesday, marking the first time the task force will retain a presidency for a two-year period under its newly revised mandate.
“A key priority under the German Presidency—beside addressing the challenges set by the Covid-19 pandemic, proceeding with the Strategic Review and further strengthening the global network—is to harness the potential of technology for the digital transformation of AML/CFT,” the organization said in a statement.
FATF will also “further focus on the financing of ethnically or racially motivated terrorism, on tackling the financial flows from migrant smuggling and on the links between illicit arms trafficking and terrorist financing,” in addition to pursuing its crackdown on the illegal wildlife trade, according to the statement.
Citing the ongoing pandemic, FATF announced in April that it was “pausing” its monitoring of jurisdictions deemed to be vulnerable to financial crime.
“However, Iceland and Mongolia requested to maintain their original schedule,” it said Tuesday. “In light of these requests, and the limited number of their remaining action plan items, the FATF agreed to proceed with the work with these two countries based on the original timelines.”
Read FATF’s plenary statement here
Read FATF’s public consultation on proliferation financing here
RiskScreen: Eliminating Financial Crime with Smart Technology
Count this content towards your CPD minutes, by signing up to our CPD WalletFREE CPD Wallet