FATF recommendations are like international rules or guidelines that countries around the world should follow to prevent criminals and terrorists from using the financial system for illegal activities. These recommendations tell countries what they should do to stop money laundering (making dirty money look clean) and terrorist financing (giving money to terrorists).
FATF recommends these rules to protect the global financial system from being used by bad people for illegal activities. Criminals and terrorists often try to hide their money or move it across borders secretly. FATF wants to make sure that countries have strong measures in place to detect and stop these activities.
FATF recommends it to all the countries in the world. It wants every country to have good rules and systems to prevent money laundering and terrorist financing. Governments, banks, and other organizations in each country need to follow these recommendations to keep the financial system safe and secure for everyone.
| Recommendation Number | Recommendation Title | Summary of Recommendation | Year of Recommendation |
|---|---|---|---|
| Recommendation 1 | Legal systems | Assess and mitigate money laundering and terrorist financing risks. | 1990 |
| Recommendation 2 | Money laundering and confiscation | Criminalize money laundering and enable confiscation. | 1990 |
| Recommendation 3 | Terrorist financing offenses and powers | Criminalize terrorist financing and grant powers to law enforcement. | 2001 |
| Recommendation 4 | Targeted financial sanctions related to proliferation | Implement targeted financial sanctions against proliferation. | 2001 |
| Recommendation 5 | Powers of competent authorities and other institutional measures | Grant authorities to combat money laundering and terrorist financing. | 1990 |
| Recommendation 6 | Reporting of suspicious transactions | Require reporting of suspicious activities to FIUs. | 1990 |
| Recommendation 7 | Internal controls, compliance, and the role of supervisors | Establish internal controls and compliance programs. | 1990 |
| Recommendation 8 | Customer due diligence (CDD) and record-keeping | Conduct customer due diligence and maintain records. | 2003 |
| Recommendation 9 | Enhanced due diligence for higher-risk situations | Apply enhanced due diligence for high-risk customers. | 2003 |
| Recommendation 10 | Simplified due diligence | Allow simplified due diligence for low-risk customers. | 2003 |
| Recommendation 11 | New technologies and reporting of suspicious transactions | Address risks related to new payment methods and technologies. | 2004 |
| Recommendation 12 | Politically exposed persons (PEPs) | Identify and manage risks associated with PEPs. | 2003 |
| Recommendation 13 | Correspondent banking and wire transfers | Ensure due diligence on correspondent banking and wire transfers. | 2003 |
| Recommendation 14 | Money or value transfer services | Regulate and supervise money or value transfer services. | 2003 |
| Recommendation 15 | New technologies | Address risks associated with new technologies. | 2012 |
| Recommendation 16 | Wire transfers | Ensure the traceability of wire transfers. | 2004 |
| Recommendation 17 | Reliance on third parties | Supervise and ensure AML/CFT compliance by third parties. | 2012 |
| Recommendation 18 | Internal controls for banks | Establish and maintain internal controls in banks. | 2004 |
| Recommendation 19 | Higher-risk countries | Implement measures for higher-risk countries. | 2004 |
| Recommendation 20 | Reporting of suspicious transactions and compliance | Ensure reporting and compliance with recommendations. | 2012 |
| Recommendation 21 | Tipping-off and confidentiality | Prohibit tipping-off and maintain confidentiality. | 2004 |
| Recommendation 22 | DNFBPs: Customer due diligence | Apply customer due diligence for DNFBPs. | 2008 |
| Recommendation 23 | DNFBPs: Other measures | Implement other measures for DNFBPs. | 2008 |
| Recommendation 24 | Transparency and beneficial ownership of legal persons | Ensure transparency of legal persons’ beneficial ownership. | 2012 |
| Recommendation 25 | Transparency and beneficial ownership of legal arrangements | Ensure transparency of legal arrangements’ beneficial ownership. | 2012 |
| Recommendation 26 | Regulation and supervision of financial institutions | Regulate and supervise financial institutions effectively. | 2004 |
| Recommendation 27 | Powers of supervisors | Grant powers to supervisors for AML/CFT compliance. | 2004 |
| Recommendation 28 | Regulation and supervision of DNFBPs | Regulate and supervise DNFBPs effectively. | 2004 |
| Recommendation 29 | Financial intelligence units (FIUs) | Establish and maintain FIUs for AML/CFT purposes. | 2004 |
| Recommendation 30 | Responsibilities of law enforcement and investigative authorities | Ensure law enforcement and investigative authorities’ effectiveness. | 2005 |
| Recommendation 31 | Powers of law enforcement and investigative authorities | Grant powers to law enforcement and investigative authorities. | 2005 |
| Recommendation 32 | Cash couriers | Regulate and supervise cross-border cash movements. | 2004 |
| Recommendation 33 | Statistics | Collect, analyze, and disseminate AML/CFT statistics. | 2004 |
| Recommendation 34 | Guidance and feedback | Provide guidance and feedback to reporting entities. | 2004 |
| Recommendation 35 | Sanctions | Implement effective, proportionate, and dissuasive sanctions. | 2004 |
| Recommendation 36 | International instruments | Ratify and implement relevant international instruments. | 2004 |
| Recommendation 37 | Mutual evaluations, follow-up, and reporting | Undergo mutual evaluations and follow-up processes. | 2004 |
| Recommendation 38 | Mutual evaluations: confidentiality | Maintain confidentiality of mutual evaluation reports. | 2004 |
| Recommendation 39 | Other forms of evaluation | Consider other forms of evaluation to assess compliance. | 2004 |
| Recommendation 40 | Recommendations and interpretive notes | Comply with recommendations and interpretive notes. | 2004 |
