The FATF has published a summary of the outcomes stemming from the Plenary held at the FATF headquarters in Paris, which concluded on the 24th February 2023.
Outcome 1: FATF public statements in relation to the Russian Federation
One year after the Russian Federation’s illegal, unprovoked and unjustified full-scale military invasion of Ukraine, the Russian Federation continues to intensify the war of aggression against Ukraine.
This runs counter to FATF’s principles of promoting security, safety and the integrity of the global financial system and the commitment to international cooperation and mutual respect.
As a result, the FATF Plenary has today suspended the Russian Federation’s membership.
Outcome 2: Alterations to the list of Jurisdictions under Increased Monitoring (Grey list)
The FATF has updated the list of jurisdictions under increased monitoring, removing Cambodia and Morocco and added Nigeria and South Africa to the list.
Outcome 3: Beneficial Ownership
Last year, the FATF agreed on tougher global beneficial ownership standards by requiring countries to ensure that competent authorities have access to adequate, accurate and up-to-date information on the true owners of companies.
As a result, Recommendation 24 on legal persons had been revised, requiring countries to ensure that beneficial ownership information is held by a public authority or body functioning as a beneficial ownership registry, or an alternative mechanism they will use to enable efficient access.
The FATF Plenary has now finalised a guidance document, scheduled for publication in March 2023, which will help countries implement the revised requirements of Recommendation 24.
The Plenary also agreed on enhancements to Recommendation 25 on legal arrangements to bring requirements broadly in line with those for Recommendation 24, to ensure a balanced and coherent set of FATF standards on beneficial ownership.
An additional guidance document will be drafted by the FATF in order to help countries implement the revised requirements of Recommendation 25.
Outcome 4: Disrupting the financial flows from ransomware
The FATF has noted that the scale and number of ransomware attacks has increased significantly in recent years, as criminals are exploiting the latest technologies to develop increasingly powerful tools to carry out their attacks.
Due to this, the FATF has carried out an analysis of the methods criminals use to carry out their ransomware attacks and how they launder ransom payments.
A report in relation to this analysis will be published in March 2023. The report will include a list of risk indicators which can help the public and private sector identify suspicious activities related to ransomware.
Outcome 5: Improving implementation of FATF requirements for virtual assets and virtual asset service providers
Despite the FATF strengthening Recommendation 15, in October 2018, to address virtual assets and virtual asset service providers, many countries have failed to implement these revised requirements, including the ‘travel rule’ which requires obtaining, holding, and transmitting originator and beneficiary information relating to virtual assets transactions. This has led to many countries creating opportunities for criminals and terrorist to exploit virtual assets.
The Plenary has therefore agreed on a roadmap to strengthen the implementation of FATF Standards on virtual assets and virtual asset service providers, which will include a stocktake of current levels of implementation across the global network.
Outcome 6: Money Laundering and Terrorist Financing in the Art and Antiquities Markets
The FATF has finalised a further report, which was scheduled for publication on the 27th of February 2023. The report explores the link between money laundering and art and antiquities.
This report is aimed at exploring how terrorist groups can use cultural objects from areas where they are active to finance their operations and include a list of risk indicators which can help the public and private sector identify suspicious activities in the art and antiquities markets.
The report also includes existing good practices which have been implemented by countries to address the challenges they face.