Why in the news?
- FATF has flagged state sponsorship of terrorism for the first time in its report, reinforcing India’s long-standing position regarding Pakistan’s role.
Financial Action Task Force (FATF)
- What is it?: FATF is a global money laundering and terror financing watchdog setup in 1989.
- Launch: It is launched by G7 countries at Paris.
- Head Quarter: The FATF Secretariat is located at the OECD headquarters in Paris.
- Functions:
- FATF’s main role is to review money laundering and terrorist financing techniques and improve its standards to address new risks, such as regulating virtual assets like cryptocurrencies.
- FATF also monitors countries to ensure they fully implement the FATF Standards and takes action against those that do not comply.
- FATF Sessions:
- The decision-making body of FATF is called the FATF Plenary, which meets three times a year.
- Membership:
- It is a 39-member body representing most major financial centres in all parts of the globe.
- India joined with ‘observer’ status in 2006 and became a full member of FATF in 2010.
- Listing:
- The Grey List includes countries that are considered safe haven for supporting terror funding and money laundering.
- The Black List includes Non-Cooperative Countries or Territories (NCCTs) that support terror funding and money laundering activities. As of now, Iran, North Korea and Myanmar are the three black listed countries.