Regional Features of Compliance With FATF Requirements

Abstract

Increasingly expanding international requirements in the field of combating money laundering and terrorist financing(AML/CFT) force the public and financial sector to seek a balance between the rising costs of their implementation andsanctions threats for non-compliance. A number of scientific publications describe regional AML/CFT cooperation in theEuropean Union (EU) as an example of such a balance. Some EU countries coordinate their actions within the frameworkof the Financial Action Tasks Force on Money Laundering (FATF), which is the methodological centre of the global antimoneylaundering movement. Russia is a member of the FATF and its two regional groups: Moneyval, organized by theCouncil of Europe, and the Eurasian Group (EAG) initiated by Russia itself, which unites Russiaʼs neighbouring, mainlyAsian, countries. This study covers the results of assessments of compliance by EU and EAG countries with FATF requirementsin order to study approaches to AML/CFT regional cooperation and to identify problems arising in this process andprospects for international cooperation. The methods of comparative and graphical analysis were used. The authors showthat deep regional integration of lawmaking is not in itself a fundamental factor in achieving equally high rates of compliancewith FATF requirements. Indifference to matters of monitoring compliance with approved regional anti-money launderingstandards allows particular EU countries to act in the national interest, contrary to the 40 FATF recommendations and thegoals of the global AML/CFT regime. On the contrary, the EAG countries demonstrate steady progress in the introductionof legislation and practical implementation of FATF requirements, which indicates their collective awareness of the benefitsfrom financial information transparency and the possibility of exchanging this information at the international level.