The 40 Recommendations, published October 2004

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40 Recommendations

FATF Standards - 40 Recommendations rc.pdf
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The 40 Recommendations, published October 2004

The 40 Recommendations provide a complete set of counter-measures against money laundering (ML)covering the criminal justice system and law enforcement, the financial system and its regulation, and international co-operation.

They have been recognised, endorsed, or adopted by many international bodies. The Recommendations are neither complex nor difficult, nor do they compromise the freedom to engage in legitimate transactions or threaten economic development. They set out the principles for action and allow countries a measure of flexibility in implementing these principles according to their particular circumstances and constitutional frameworks. Though not a binding international convention, many countries in the world have made a political commitment to combat money laundering by implementing the 40 Recommendations.

Initially developed in 1990, the Recommendations were revised for the first time in 1996 to take into account changes in money laundering trends and to anticipate potential future threats. More recently, the FATF has completed a thorough review and update of the 40 Recommendations (2003). The FATF has also elaborated various Interpretative Notes which are designed to clarify the application of specific Recommendations and to provide additional guidance.

The FATF revised the 40 and IX Recommendations.  The revision of the FATF Recommendation was adopted and publised in February 2012.  The FATF Recommendations to go to the 2012 FATF Recommendations.  

The 40 Recommendations

A. Legal Systems

  • Scope of the criminal offence of money laundering (Recommendations 1, 2)
  • Provisional measures and confiscation (Recommendation 3)

B. Measures to be taken by Financial Institutions and Non-Financial Businesses and Professions to prevent Money Laundering and Terrorist Financing

(Recommendation 4)

  • Customer due diligence and record-keeping (Recommendations 5 - 12)
  • Reporting of suspicious transactions and compliance (Recommendations 13-16)
  • Other measures to deter money laundering and terrorist financing (Recommendations 17-20)
  • Measures to be taken with respect to countries that do not or insufficiently comply with the FATF Recommendations (Recommendations 21, 22)
  • Regulation and supervision (Recommendations 23-25)

C. Institutional and other measures necessary in systems for combating Money Laundering and Terrorist Financing

  • Competent authorities, their powers and resources (Recommendations 26-32)
  • Transparency of legal persons and arrangements (Recommendations 33, 34)

D. International Co-operation

Recommendation 35

  • Mutual legal assistance and extradition (Recommendations 36-39)
  • Other forms of co-operation (Recommendation 40)