Declaration of the Ministers and Representatives of the Financial Action Task
Effective action against money laundering and terrorist financing, including both preventive and law enforcement measures, is essential for securing a more transparent and stable international financial system. Likewise, new threats, such as the financing of proliferation of weapons of mass destruction, can emerge and result in the clandestine use of the international financial system. As an intergovernmental body established by the G7 Summit in 1989, the Financial Action Task Force (FATF) exists for the purpose of protecting the international financial system from misuse and to mobilise action to go after criminals and their assets. We, the Ministers and representatives of the FATF Members, reaffirm our commitment to the objectives of the FATF in developing policy and promoting effective implementation of legal, regulatory and operational measures for combating money laundering, terrorist financing and new and emerging threats to the integrity of the international financial system.
The FATF Recommendations are the international standard for combating money laundering and the financing of terrorism and proliferation. They form the basis for a co-ordinated response to these threats to the integrity of the financial system and help to ensure a level playing field. We welcome the adoption by the FATF of revised standards in February 2012. We endorse the FATF Recommendations as an international standard and call on all countries to fully implement measures in line with them.
Since full and effective implementation of the FATF Recommendations in all countries is one of our fundamental goals, we remain committed to assessing the degree of implementation and the effectiveness of systems designed to combat money laundering and terrorist financing through the conduct of a 4th round of ‘peer reviews’ (‘mutual evaluations’) of our Members as well as monitoring progress through appropriate follow-up processes. Future evaluations will move beyond technical compliance of the standards and aim to understand how resources and sanctions are being applied in practice to meet desired objectives. The FATF will work closely with FATF-style regional bodies (FSRBs), the International Monetary Fund (IMF) and the World Bank in refining procedures for evaluations, including the common methodology and common processes for assessing compliance.
We recognise the leading role of the FATF in promoting full and effective implementation of the FATF Recommendations in collaboration with other national and international stakeholders and, most importantly, through a global network of FSRBs. We support the linkages between the FATF and FSRB mutual evaluation programmes and the IMF/World Bank Financial Sector Assessment Programme. We also encourage the FATF to continue communicating broadly about this work.
We note that many countries – particularly those with capacity constraints – continue to face legitimate challenges in achieving effective implementation of the FATF Recommendations. Financial exclusion can also represent a real risk to achieving effective implementation. Recognising these challenges and adopting a comprehensive approach to dealing with them will contribute to universal implementation of the FATF Recommendations. The FATF will continue to support the work of regional bodies and the international organisations that are helping countries to carry out this work.
We reaffirm our support for the timely identification and monitoring of high-risk and non co-operative countries and for co-ordinated action when necessary to protect the integrity of the financial system against the threat posed by such countries. It is essential that all countries take collective action to apply countermeasures when called on by the FATF.
Maintaining the integrity of the financial system also requires the ability to respond actively and in a timely manner to significant new threats as identified by the international community, including the United Nations Security Council, the G-20 and the FATF itself, and we remain committed therefore to the need for such work. One such area, as envisaged in the revised FATF mandate adopted in 2008 is the financing of the proliferation of weapons of mass destruction for which the FATF has developed a new standard relating to the implementation of financial provisions of the United Nations Security Council resolutions on non-proliferation. We reiterate our support for this initiative and commit to having the implementation of this standard evaluated under the peer review process of the FATF. Corruption remains a global challenge, continues to hinder development in many areas and fuels criminal activity. The FATF will step up its support of anti-corruption issues through its work on money laundering and other misuse of the financial system.
Recognising that preventing the misuse of legal persons and arrangements is a core element of the fight against money laundering, terrorist financing and other illicit purposes, the FATF will continue its work to improve the transparency of legal persons and arrangements.
The fight against money laundering, terrorist financing and other misuse of the financial system must be based on a thorough understanding of these threats. We therefore encourage further strategic and focussed analysis of relevant methods and trends, as well as a continuing examination of the impact of measures designed to combat misuse of the international financial system, and we endorse support to national, regional and global threat and risk assessment initiatives.
The private sector remains on the front line of the fight against money laundering, terrorist financing and other threats to the integrity of the international financial system. We therefore reaffirm our support for continuing consultation with the private sector and civil society with a view to fostering transparency and dialogue towards more effective implementation of the FATF standards.
The FATF is a task force of its Members, and its activities have continued to evolve whilst remaining focussed on achieving concrete results. We believe that the task force structure of the FATF has served it well. The FATF should therefore retain this flexibility as it continues to consolidate and build on what it has already achieved. At the same time, the decision-making and governance processes of the FATF should be transparent and predictable.
We endorse the work of the FATF and approve the following Mandate of the Financial Action Task Force (FATF), which will from this date serve as the framework for its activities. The technical implementation of the FATF Mandate will be carried out by the officials and experts of our member countries. We look forward to receiving regular updates from the FATF on key aspects of its work.
Washington, DC, 20 April 2012