Recommandations GAFI

Consultation and dialogue with Non-Profit Organisations

Chairman's Summary

London, 24 April 2013 - The Financial Action Task Force (FATF) held a Consultation and Dialogue Meeting with Non-Profit Organisations (NPOs) on 24 April 2013 in London, United Kingdom. It was the first time that the FATF has engaged directly with NPOs on such a broad scale. The meeting was chaired by the President of the FATF, Mr Bjørn S. Aamo (Norway), and was attended by representatives of 14 FATF member and observer delegations, and 20 NPOs.

The main aim of this meeting was to stress the importance of ensuring that FATF Recommendation 8 on NPOs is not being implemented in a manner that disrupts or discourages legitimate charitable activity. This is in line with an earlier public statement by the FATF President.

In particular, the participants had an exchange of views on the terrorist financing risks and vulnerabilities facing the NPO sector, and also discussed:

  • the importance for government authorities to have a good understanding of how the NPOs in their country are vulnerable to terrorist abuse and terrorist financing risks
  • requirement for countries to implement appropriate measures to mitigate those risks without harming the legitimate activities of NPOs
  • how the misinterpretation or poor implementation of the FATF standards can adversely impact legitimate charitable activity
  • tools in the new methodology that will help assessors identify and highlight this issue when assessing how effectively countries are implementing the FATF standards, and 
  • the need for clear guidance to assist countries in their understanding and implementation of Recommendation 8.

The FATF will continue working on this issue. The first step will be to update the existing International Best Practices Paper on Combating the Abuse of Non-Profit Organisations (issued in 2002) to bring it into line with the revised FATF Recommendations, and highlight the importance of ensuring that the implementation of Recommendation 8 and its Interpretive Note does not disrupt or discourage legitimate charitable activities. The second step will be typologies work to gain a better understanding of the vulnerabilities and risks currently facing NPOs. Once the typologies exercise is completed, a more comprehensive revision of the best practices paper will be considered, in light of the outcomes from the typologies work. 

Background information on Recommendation 8

Recommendation 8 and its Interpretative Note require countries to review:

  • the activities, size and other relevant features of their NPO sector, and 
  • the adequacy of applicable laws and regulations.

The objective is to identify features and types of NPOs that, by virtue of their activities or characteristics, are at risk of being misused:

  • by terrorist organizations posing as legitimate NPOs
  • to exploit legitimate NPOs for terrorist financing purposes 
  • to escape asset-freezing measures, or
  • to conceal or obscure the clandestine diversion of funds intended for legitimate purposes to terrorist organizations.

Recommendation 8 and its Interpretive Note also require countries to;

  • reach out to NPOs 
  • effectively gather information
  • undertake investigations where abuse is suspected, and
  • co-ordinate internationally.

Additionally, countries need to supervise and monitor those NPOs representing a significant portion of the financial resources under control of the sector, and a substantial share of the sector’s international activities.

last updated: 26 Apr. 2013

Meeting

NPO