FATF Revamps Criteria to Target High-Risk Nations in Global Financial Security Move

The Financial Action Task Force has redefined its criteria to focus on countries posing significant risks to the global financial system. The revamped strategy aims to better support low-capacity nations while addressing financial crimes like money laundering and terrorist financing, thus protecting international financial integrity.

In a strategic move to tighten global financial security, the Financial Action Task Force (FATF) has announced significant alterations to its criteria, specifically targeting countries that pose substantial risks to the international financial system. The changes are intended to streamline the listing process, aiming to support low-capacity nations more effectively, according to the latest statements from the FATF.

The watchdog emphasized that the revised criteria aim to alleviate pressure on the least developed countries while focusing efforts on jurisdictions with strategic deficiencies in combating money laundering, terrorist financing, and proliferation financing. This peer-led initiative, in collaboration with relevant FATF-style Regional Bodies, seeks to eliminate loopholes that enable illegal financial activities, thereby advancing global efforts to combat severe crimes, including human trafficking and terrorism.

The modified criteria prioritize countries based on specific risks and economic indicators, allowing a longer observation period for least developed countries. The updated grey list, confirming nations with inadequate AML/CFT systems, includes countries such as Bulgaria, Burkina Faso, and Uganda, each required to implement a tailored action plan with expert guidance to enhance their financial integrity.

(With inputs from agencies.)