Financial action task force and the fight against money laundering and the financing of terrorism

Abstract

Purpose Thirty years after its creation, the Financial Action Task Force (FATF) has become a prime example of a norm-building process that transcends the traditional avenues of public international law, while compelling a high level of compliance and assuring quick adaptation to norms and practices that better address money laundering and the financing of terrorism in their evolving form. On the occasion of FATF’s 30th anniversary, this paper aims to revisit the unique characteristics of FATF and the factors behind FATF’s success as standard-setter and as implementation-reviewer in the anti-money laundering (AML)/CFT context. Design/methodology/approach This paper draws on primary sources of law, legal scholarship, reports and other open source data to analyse the FATF norm-building process and the factors behind its success. Findings Thirty years after its creation, the FATF has established itself as the key standard-setter, implementation-reviewer and force for reform in the AML/CFT context. Though the FATF norm-building process has been very successful, owing to its flexibility, adaptability and expansiveness, significant challenges lay ahead due to the evolving nature of money laundering and financing of terrorism. Originality/value This is a comprehensive study examining the achievements, impact, strengths and weaknesses of the FATF norm-building process on the occasion of the organisation’s 30th anniversary.

A case of insufficient safeguards or state-enabled money laundering? ‘Golden Passport’ and ‘Golden Visa’ investment schemes in Europe

“…The legal standards set by the FATF constitute an appropriate response to moneylaundering risks (Pavlidis, 2020a), but the EU needs to introduce further common rules and safeguards because investment migration and national RBI/CBI schemes have implications for the EU as a whole. The new EU common rules should be based on a thorough riskbased assessment of the RBI/CBI schemes in compliance with FATF standards.…”

The sustainability of the international AML regime and the role of the FATF. The objectivity of the greylisting process of developing jurisdictions like Pakistan

“…Its membership is voluntary and only comprises 37 countries, many of whom are EU members. As per international law, the FATF is an organisation without binding rights and explicit and formal authority (Pavlidis, 2020; Video, 2018). Therefore, by forcing countries to adopt recommendations, the FATF is violating the UN charter and Vienna Convention of 1969 (the law of treaties) article 26 (Doyle, 2002) and directly influencing the country’s human rights obligations (Hayes and Breas for the World, Protestant Development Service, 2017).…”

Blanqueo de capitales y regímenes de ciudadanía y residencia para inversores en la Unión Europea

“…Las normas establecidas por el GAFI constituyen una respuesta adecuada a los riesgos de blanqueo de capitales (Pavlidis, 2021), pero la UE tiene que introducir nuevas normas comunes y garantías ya que los regímenes RBI / ICC tienen implicaciones para la UE en su totalidad. Las nuevas reglas comunes de la UE deben basarse en una evaluación exhaustiva basada en el riesgo de los regímenes RBI / CBI, de conformidad con los estándares del GAFI.…”