Introduction

This is the second of three chapters devoted to the work in respect of the ‘Offshore’ environment that has been carried out by certain supranational organisations. The work of the Financial Stability Forum (FSF), the International Monetary Fund (IMF) together with that of the World Bank was considered in the previous chapter. This chapter focuses on the work of the Financial Action Task Force (FATF).

An outline of the FATF has been provided in section 9.8 above, so the introduction that follows merely serves to place the work of the FATF in context.

The work of the Financial Action Task Force

The Annual Report for 2004–5 states that the FATF carries out the following tasks:

• it sets international AML/CFT standards;

• it monitors compliance with AML/CFT standards;

• it promotes worldwide application of the FATF's standards;

• it encourages compliance of non-FATF members with FATF standards; and

• it studies the methods and trends of money laundering and terrorist financing.

The FATF works closely with international financial institutions in compiling, applying and promoting international standards, principal among which are the Forty Recommendations and the Nine Special Recommendations. ‘It is estimated that about 130 jurisdictions representing 85 per cent of the total world population, and about 90–95 per cent of global economic output have made at least a political commitment to implement the 40 Recommendations’.