The Financial Action Task Force (FATF) is considering proposals for amendments to Recommendation 1 and its Interpretive Note to require countries and the private sector to identify, and assess the risks of potential breaches, non-implementation or evasion of the targeted financial sanctions (TFS) related to proliferation financing, as contained in FATF Recommendation 7, and to take action to mitigate these risks. The draft text of proposals for amendments is available here . Proposed amendments are in redline.
The FATF is consulting all affected stakeholders before finalising these amendments. We would welcome views on specific proposals of the amendments to the text, as well as on the broader themes that they address. However, the draft is not intended to cover broader issues of counter proliferation and relevant activity-based prohibitions, which are out of scope of Recommendation 7.
The proposed amendments seek to reinforce the implementation of targeted financial sanctions, by obliging financial institutions and DNFBPs to assess the risks of breach, non-implementation and evasion of targeted financial sanctions related to proliferation financing, and to take appropriate mitigating measures commensurate with the level of risks identified. This would ensure that they do not unwittingly support proliferation financing.
The proposed amendments to R.1 would not substitute for the existing requirements to implement Targeted Financial Sanctions as required by the relevant UN Security Council Resolutions relating to the prevention, suppression and disruption of proliferation of weapons of mass destruction and its financing. The mandatory provisions of Recommendation 7 must still be observed regardless of the level of risk. The new amendments also would not expand the existing obligations on financial institutions and DNFBPs with respect to combating money laundering and terrorist financing set out in the FATF Recommendations.
Please provide your response to FATF.Publicconsultation@fatf-gafi.org by 31 August 2020 (18h00 UTC). When submitting your response, please indicate the name of your organisation, the nature of your business (FI, DNFBP, others), and your contact details. You may insert any specific drafting proposals directly in the attached text of the draft proposals in tracked changes. The contact information you provide will be used for the purpose of this public consultation only. The FATF will not share this information with third parties without your consent.
Please note that these proposals for amendments to Recommendation 1 and its Interpretive Note remain in draft stage and the FATF will be further considering the proposals in light of the public consultation, in its next Plenary meeting in October 2020.
Source: FATF (30 June 2020)