Paris, 16 November 2023 – The Financial Action Task Force (FATF) today released amendments to the FATF Recommendations which will provide law enforcement, financial intelligence units, prosecutors, other asset recovery practitioners and competent authorities with a more robust toolkit to target and confiscate criminal assets.

Criminals are able to move assets quickly and easily across borders with the aid of technology. These revised Recommendations will help countries respond to the speed of criminal activity and equip them to succeed by introducing new tools, closing loopholes, and emphasising actions to target and capture criminal proceeds at the opportune moment.

At their 2022 Meeting, FATF Ministers expressed concern that efforts to confiscate the proceeds of crime remain insufficient compared to the volume of criminal assets flowing through the global financial system and infiltrating national economies. FATF thus made it a strategic priority to improve asset recovery outcomes under the Singapore Presidency. Effective asset recovery removes the financial incentive for criminal activity, limits the capacity of organised criminal groups and terrorists to threaten safety and security, and, importantly, enables assets to be returned to victims of crime, including nations harmed by corruption and tax offences.

The FATF has spearheaded global efforts to strengthen the legal and operational frameworks which underpin countries’ asset recovery outcomes. These efforts have culminated in the first substantive change to the FATF Recommendations related to asset freezing, seizure, confiscation, forfeiture, and associated international cooperation since the Standards were first developed in 1990, and are necessary to help countries build more effective asset recovery systems to deprive criminals of their ill-gotten gains and protect the international financial system.

The amendments include requirements for confiscation and provisional freeze and seize measures in the domestic context (R.4 and its Interpretive Note) and measures to improve international cooperation on asset recovery (R.38 and its Interpretive Note). The amendments will bolster the powers and ability of law enforcement and other authorities to identify and trace criminal property. They also set out new forms of international cooperation which emphasise the importance of swift and efficient channels and mechanisms (R.30, 31 and 40 and related Interpretive Notes).

Among the many significant reforms, key changes include:

• The FATF now requires countries to establish asset recovery as a priority, both at the domestic and international levels, and to periodically review their confiscation policies and operational frameworks. Countries must coordinate and share information internally, to identify criminal property. This will bring about the cultural shift to mainstream asset recovery in crime-fighting and focus on asset recovery at the onset of investigations.
• A new requirement for countries to establish a non-conviction based confiscation regime in their legal systems, to the extent that such a requirement is consistent with fundamental principles of domestic law. This regime has proven effective, especially when criminal prosecution is unlikely or impossible, and particularly to combat the laundering of crimes linked to corruption. It also takes into account legal differences between countries and the protection of property rights of innocent parties.
• The implementation of extended confiscation, whereby criminals are deprived of assets from a criminal lifestyle, or which exceed their known lawful income, to the extent that such a requirement is consistent with fundamental principles of domestic law. This tool has yielded substantial results in the fight against organised crime.
• Stronger tools to temporarily freeze, seize, and restrain suspected criminal property while an investigation is at an early stage, including the power to suspend or withhold consent to transactions and freeze and seize expeditiously. This is critical to stopping the dissipation of criminal proceeds and enabling successful future recoveries. It will also strengthen countries’ ability to respond to the threat of cyber-enabled crime as digitalisation and technology have enabled criminals to increase the speed and reach of their activities.
• Detailed obligations for countries to be able to recognise each other’s preliminary and final court orders concerning assets subject to confiscation. This is a major step forward to reflect the reality of transnational money laundering investigations and enhance the efficiency of enforcement of lawful judgments.
• Finally, the FATF Recommendations underscore the importance of good communication and “informal” cooperation between countries on asset recovery. This is crucial to lay the groundwork for smoother and more timely cooperation through mutual legal assistance treaties. Countries should also take part in and actively support multilateral networks to better facilitate rapid and constructive international cooperation in asset recovery.

The FATF expects all countries to take concrete steps to implement these new Standards promptly. The FATF will now work to revise relevant parts of its assessment Methodology for the next round of mutual evaluations to take into account the changes to the Recommendations.