Financial Action Task Force

The Financial Action Task Force, known by its French name Groupe d'action financiere and commonly abbreviated FATF or GAFI, is an intergovernmental policy making body established in 1989 on the initiative of the Group of Seven to develop international standards for combating money laundering. Its mandate was broadened in 2001, after the September 11 attacks, to include the financing of terrorism, and it has continued to expand its focus since to cover related threats such as the financing of weapons proliferation. FATF does not itself investigate crimes or impose legal sanctions, instead it issues recommendations that set international standards, conducts peer review mutual evaluations of how thoroughly member and non member jurisdictions have implemented them, and maintains public lists, commonly called blacklists and greylists, identifying jurisdictions with significant deficiencies in their anti money laundering and counter terrorist financing regimes. Placement on these lists carries substantial practical consequences even without any formal legal penalty, since banks and other financial institutions worldwide routinely treat FATF listed jurisdictions as higher risk, generating real financial and reputational pressure on the governments concerned to bring their laws into compliance.