FATF Annual Report 1994-1995

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Netherlands Kingdom of


FATF Annual Report 1994-1995

The sixth round of the Financial Action Task Force (FATF) was chaired by the Netherlands. The major achievements of the round included:

  • the completion of the first set of mutual evaluations of the anti-money laundering measures taken by its members; 
  • a broad-ranging review of money laundering trends and techniques, together with a specific examination of the threat posed by Russian organised crime; 
  • the adoption of an Interpretative Note clarifying the application of anti-laundering measures to bureaux de change -- a sector which has been increasingly targeted by money launderers; an intensive programme of contacts with non-member jurisdictions, with particular emphasis on the Asian region; and 
  • the strengthening of co-operation with international organisations, especially the IMF. 

The FATF also began its stocktaking review of the forty FATF Recommendations and a review of its policy on expansion of the membership of the FATF. Both these areas of work will be taken forward in FATF-VII.

A significant part of the FATF’s work continued to focus on monitoring the implementation by its members of the forty Recommendations. The performance of members is generally satisfactory and there has been major progress as regards the application of the Recommendations dealing with the financial sector, particularly as regards the role of regulatory authorities in checking compliance with antimoney laundering measures. However, the delay experienced in certain members in implementing a significant number of Recommendations is a matter of serious concern.

Seven mutual evaluations were completed in FATF-VI -- New Zealand, Portugal, Iceland, Singapore, Turkey, Aruba and the Netherlands Antilles. Summaries of the evaluations are contained in Part I of the report. All member jurisdictions have now been the subject of a mutual evaluation. A second round of mutual evaluations, focusing on the effectiveness of member’s anti-money laundering measures in practice, will begin in 1996. The FATF also carried out a cross-jurisdiction review of the suspicious transaction reporting systems and procedures in operation in its members. 

The annual survey of money laundering methods and countermeasures was broadened in an attempt to produce a global overview of trends and techniques. The general trend towards more diverse money laundering methods continues. Among the mechanisms noted was the growing use of international trade in the money laundering process; the use of bureaux de change, casinos and gambling houses in placing criminal proceeds into the financial system; and the development of new ways of using the banking system. A survey of money laundering by Russian organised crime confirmed the widespread geographical nature of its operations. Although the evidence indicates that most of the funds flow from East to West, money is also being moved back into Russia.

FATF Annual Report 1994-1995