Outcomes of the FATF Plenary, 19–21 February 2025

From 19 to 21 February 2025, the second FATF Plenary was held in Paris, France, chaired by the incumbent FATF President, Ms Elisa de Anda Madrazo of Mexico. The Plenary brought together more than 200 delegates from jurisdictions of the FATF's Global Network and observers from international organisations. Delegates discussed and identified measures to address the key issues of money laundering, terrorist financing and the financing of proliferation of weapons of mass destruction (WMD).

Following an extensive public consultation, the Plenary agreed to amend the FATF Standards in order to deliver one of the main priorities of the Mexican Presidency's term, namely better support for the risk-based approach and financial inclusion,

In addition, to ensure the completion of important work to stop the flow of funds linked to online child sexual exploitation and to protect children from harm, the organisation will publish an approved report next month.

The Plenary agreed to undertake a further public consultation on work relating to payment transparency, complex proliferation financing activities and sanctions evasion, so as to support the implementation of the changes to the Standards on financial inclusion. The FATF continues to seek the widest possible range of views and perspectives in order to generate new contributions.

The FATF removed the Philippines from the list of jurisdictions under increased monitoring following a successful on-site visit, and also updated its statements on "High-Risk Jurisdictions subject to a Call for Action" and "Jurisdictions under Increased Monitoring".

This Plenary also welcomed Kenya, newly invited to take part in the FATF Plenary and Working Groups under the guest initiative designed to enhance inclusiveness and to support a better identification of regional specificities at the FATF. Alongside Kenya, the list of countries taking part in the guest initiative also includes the Cayman Islands and Senegal, starting from October 2024.

Furthermore, as at present, the suspension of the Russian Federation remains in effect.

A view of the February 2025 FATF Plenary in Paris. Source: Compiled

Jurisdictions under Increased Monitoring

Jurisdictions under increased monitoring are actively working with the FATF to address strategic deficiencies in their regimes for countering money laundering, terrorist financing and proliferation financing (AML/CFT/CPF). When the FATF places a jurisdiction under increased monitoring, this means that the country has committed to implementing an action plan to resolve the identified strategic deficiencies swiftly within the agreed timeframes.

At this Plenary, the FATF added the Lao People's Democratic Republic and Nepal to the list of Jurisdictions under Increased Monitoring.

Jurisdictions no longer subject to increased monitoring

The Plenary announced that the Philippines has been removed from the FATF's list of jurisdictions under increased monitoring (the grey list) after nearly four years of being listed and subject to the organisation's monitoring processes since June 2021. The Philippines has made positive progress and has completed its action plan within the agreed timeframes to address the strategic deficiencies in countering money laundering, terrorist financing and proliferation financing.

Nevertheless, the country still needs to continue working with the Asia/Pacific Group on Money Laundering (APG), of which the Philippines is currently a member, in order to sustain the improvements in its anti-money laundering and counter-terrorist financing system. The FATF encourages the Philippines to continue its work to ensure that counter-terrorist financing measures are applied appropriately, in particular the identification and prosecution of WMD proliferation financing cases, without disrupting the legitimate activities of non-profit organisations (NPOs).

Membership matters

The FATF continues to maintain the suspension of the membership of the Russian Federation. Following the statements issued since March 2022, the FATF reiterates that all jurisdictions should remain vigilant to current and emerging risks from the circumvention of measures taken against Russia, in order to protect the international financial system.

FATF Vice-President (2025–2027)

The Plenary announced that Mr Giles Thomson of the United Kingdom (UK) will become the new FATF Vice-President. He will succeed Mr Jeremy Weil of Canada, who has held the role since 1 July 2023 and whose term will end on 30 June 2025. Mr Thomson is currently Director of the Office of Financial Sanctions Implementation and Economic Crime at HM Treasury, is Head of the United Kingdom delegation to the FATF, and will serve as FATF Vice-President for two years from 1 July 2025.

Strategic initiatives

1. Financial inclusion and the risk-based approach

Having gathered more than 140 responses from the public consultation, members agreed to revise the FATF Standards to better support the objective of financial inclusion, noting that some 1.4 billion people worldwide remain unbanked.

These changes were informed by a wide range of contributions, including from non-profit organisations, banks, payment service providers, insurers, academics, accountants, lawyers and other international organisations.

Recommendation 1 aims to ensure that countries apply a risk-based approach to measures for countering money laundering, terrorist financing and proliferation financing. These changes will encourage financial institutions to apply simplified measures where risks are low, facilitating access to financial services for everyone.

This builds on an extensive body of work responding to the findings of the 2021 review, in which the FATF stressed that de-risking, financial exclusion, the undue targeting of non-profit organisations and the restriction of human rights can occur where jurisdictions do not apply the risk-based approach correctly.

2. Detecting and preventing online child sexual abuse

The Plenary adopted a landmark report examining how the scrutiny of financial flows and the collection of financial intelligence can help detect, prevent and investigate the monetisation of online child sexual abuse.

Drawing on case studies and expertise from the FATF's Global Network, the report will help link financial transactions to the offence and enable earlier detection of and intervention in cases of live-streamed child sexual abuse and child "sextortion".

The report will be released at an event in London on 13 March 2025, which will bring together representatives from across the public and private sectors with a view to taking forward the report's findings worldwide.

3. Public consultations

The FATF is developing new guidance to give effect to the changes to Recommendation 1 in support of the risk-based approach and financial inclusion. This guidance will equip policymakers and regulators with practical examples to encourage broad compliance with the changes. The FATF welcomes feedback on this guidance so that the public and private sectors can implement the risk-based approach to best effect.

The FATF also agreed to consult on potential revisions to its Recommendation 16 on payment transparency, with the aim of improving the standard and quality of originator and beneficiary information in payments. This will help achieve greater transparency and security, avoid duplication and promote more efficient compliance processes by financial institutions, while supporting faster and cheaper payments. The FATF is seeking the widest possible range of views with the aim of supporting the use of new technologies without undermining measures against illicit finance.

In addition, the FATF is seeking input to understand complex proliferation financing schemes and sanctions evasion. The FATF will review information on best practices and challenges in identifying, assessing, understanding and mitigating WMD proliferation financing risks. The public consultation will also gather views on how the FATF can support the private sector in meeting its counter-proliferation financing obligations.

Details of the three consultations will be published on the FATF website in due course.

4. Global Network cooperation

Under the Mexican Presidency, the FATF has stepped up action to strengthen the voice and participation of FATF-Style Regional Bodies (FSRBs) in the FATF's work and to reinforce cohesion across the Global Network.

The FATF President continues to build on the initiative launched in October 2024 to encourage guest jurisdictions to engage more actively with the FATF and to promote greater regional representation. This week, Kenya joined the Cayman Islands and Senegal in attending the Plenary as a guest jurisdiction.

This guest initiative aims to broaden the diversity of views and contexts at the FATF from regions around the world where there is currently limited FATF membership. Invitations to guest jurisdictions run for one year, on a rotating basis.

5. Women in the FATF and the Global Network (WFGN) Initiative

During the Plenary week, the FATF successfully held an event in support of the Women in the FATF and the Global Network development programme. The FATF discussed further proposals to support women's careers and will launch the second edition of the FATF Mentoring Programme in March 2025.

6. Review of technical compliance by corruption-related "gate-keepers"

The Plenary affirmed the importance of the FATF's review of designated non-financial businesses and professions (DNFBPs), considering action to apply key aspects of the FATF Recommendations to lawyers, accountants, trust and company service providers, and real estate agents. Countries are encouraged to continue addressing their deficiencies.

7. Private Sector Collaborative Forum

Members continued to express support for the FATF's close engagement with the private sector and civil society in order to address effectively the current and emerging threats to the global financial system.

The FATF's annual Private Sector Collaborative Forum will take place in Mumbai on 25–27 March 2025, bringing together representatives from the financial sector, designated non-financial businesses and professions, academia, FATF members and other stakeholders.

Vu Thu Ha – TT81