FATF Recommendations (40 Recommendations)

FATF issued the original forty recommendations in 1990 and has revised them several times since, so the current text is best read directly from FATF. They are grouped by theme: national policy and coordination, criminalising laundering and confiscation, preventive measures for financial institutions and other businesses, transparency of legal persons and trusts, powers of authorities, and international cooperation. They are written at a high level and require national laws to fill in detail. Their reach has grown from laundering to terrorist financing and to proliferation financing. Countries are tested against them in mutual evaluations, and poor results can lead to grey listing. Many regulators and banks use the Recommendations as the reference when writing AML rules. Almost every national AML regime traces back to these standards, so a reviewer reading a country's law will usually find them behind it.

A country preparing for its mutual evaluation reviews its laws against the Recommendations and finds that dealers in precious stones are not covered by AML rules and that company ownership records are incomplete. Parliament amends the law to add the sector and to require registers of beneficial ownership before assessors arrive.