Financial Action Task Force (FATF)

FATF was established in 1989 by the G7 group of major economies and is based in Paris. Its membership includes around 40 countries and regional organisations, and a wider global network of regional bodies applies its standards in more than 200 jurisdictions.

FATF’s main standards, known as the FATF Recommendations, set out measures countries should take, such as criminalising money laundering, requiring banks and other businesses to identify their customers and report suspicious transactions, identifying the real owners of companies and cooperating internationally.

FATF assesses countries through mutual evaluations, peer reviews of how well they apply its standards. Countries with serious weaknesses can be placed on lists of jurisdictions under increased monitoring, often called the grey list, or high-risk jurisdictions subject to a call for action, often called the black list.

For example, a country placed on the grey list may face more checks from international banks and investors, raising costs for its businesses and encouraging it to strengthen its rules.

FATF standards have also been extended to cover virtual assets and their service providers, such as crypto exchanges.