FATF Statement
Published Date: 24 December 2020

October 2020 FATF Statement

 

The FATF has decided to pause the review process for the list of “High-Risk Jurisdictions subject to a Call for Action[1]. As such, FIs should continue to refer to the previous Statement issued in February 2020, which highlights the strategic deficiencies in the anti-money laundering/combating the financing of terrorism (AML/CFT) regimes of the Democratic People’s Republic of Korea (DPRK) and Iran. While the statement may not necessarily reflect the most recent status in DPRK and Iran due to the pause in the review process, the FATF’s call for action on these high-risk jurisdictions remains in effect.

 

  • On DPRK, the FATF remains concerned by its failure to address the significant deficiencies in its AML/CFT regime and the serious threats they pose to the integrity of the international financial system. The FATF urges the DPRK to immediately and meaningfully address its AML/CFT deficiencies. The FATF has serious concerns with the money laundering, terrorism financing and proliferation financing risks posed by DPRK’s illicit activities. DPRK is subject to the FATF’s call on countries to apply counter-measures and FIs should give special attention to business relationships and transactions with links, whether directly or indirectly, to the DPRK. Countries and financial institutions (FIs) are called to apply effective counter‑measures, targeted financial sanctions, and other measures in accordance with the applicable United Nations Security Council Resolutions (UNSCRs). In considering the range of counter-measures, FIs in Singapore should consider DPRK a high risk jurisdiction and apply enhanced due diligence measures accordingly. FIs should continue to comply with the requirements in the MAS (Sanctions and Freezing of Assets of Persons – DPRK) Regulations 2016, and take appropriate risk mitigation, incorporating the relevant guidance provided by MAS.

 

  • Iran’s action plan expired in January 2018 and in February 2020, FATF noted Iran has not completed the action plan. Given Iran’s continued failure to enact the Palermo and Terrorist Financing Conventions in line with the FATF Standards, the FATF has decided in February 2020 to fully lift the suspension of counter-measures. FATF members and FIs are called to apply effective counter-measures, in line with Recommendation 19. The FATF remains concerned with the terrorism financing risk emanating from Iran and the threat this poses to the international financial system. If Iran ratifies the Palermo and Terrorist Financing Conventions in line with the FATF Standards, the FATF will decide on the next steps, including whether to suspend counter-measures. In considering the range of counter-measures, FIs in Singapore should consider Iran a high risk jurisdiction and apply enhanced due diligence measures accordingly. FIs should continue to comply with the requirements in the MAS (Sanctions and Freezing of Assets of Persons – Iran) Regulations 2016, and take appropriate risk mitigation, incorporating the relevant guidance provided by MAS.

 

Further details of the February 2020 Statement can be found at:

http://www.fatf-gafi.org/publications/high-risk-and-other-monitored-jurisdictions/documents/call-for-action-february-2020.html

 

The FATF has also issued an updated statement on Jurisdictions under Increased Monitoring[2] in October 2020. In light of the COVID-19 pandemic, monitored jurisdictions were given the option not to report at the October meeting. However some jurisdictions chose to report their progress, and the FATF has updated its statement on these jurisdictions. This statement can assist FIs and relevant non-financial institutions in your risk assessment and mitigation. The latest FATF statement on Jurisdictions under Increased Monitoring can be found at:

http://www.fatf-gafi.org/publications/high-risk-and-other-monitored-jurisdictions/documents/increased-monitoring-october-2020.html

 

Non-financial institutions that are subject to AML/CFT requirements in Singapore are similarly advised to note the updated and new statement and take appropriate measures in accordance with your respective AML/CFT obligations, and the relevant UN Regulations.



[1] Previously called “Public Statement”

[2] Previously called “Improving Global AML/CFT Compliance: On-going process”