FATF suspends Russia's membership over Ukraine war

Tags: International News

Global anti-money laundering watchdog Financial Action Task Force (FATF) suspended Russia's membership on February 24 over the Ukraine war.

An overview of the news

• The FATF has suspended Russia's membership for its "illegal, unprovoked and unjustified" full-scale military invasion of Ukraine.

• Russia's actions "run unacceptably" against the FATF's core principles, which aim to protect, safeguard and promote the integrity of the global financial system.

• The FATF is also concerned about information on arms trade between Russia and UN-sanctioned jurisdictions, and Russia's malicious cyber activities.

• Russia is accountable for its obligation to implement FATF standards.

South Africa, Nigeria on dirty-money grey list

• South Africa and Nigeria have been placed on FATF's gray list, indicating deficiencies in the handling of financial flows to the nations.

• It is a move that tarnishes the international reputation of such countries and could raise costs for banks and asset managers.

• Morocco and Cambodia have been removed from the list after reforming their controls.

Financial Action Task Force (FATF)

• It was formed in the year 1989 at the meeting of G-7 countries held in Paris.

• It works to generate the necessary political will to bring about legislative and regulatory reforms in the world on issues like money laundering, terror funding.

• Headquarters - Located in the headquarters of the Organisation for the Development of Economic Co-operation (OECD) in Paris.

• Member Countries - 39 member countries including India and 2 regional organisations (European Commission and Gulf Cooperation Council).

• India became a member of FATF in the year 2010.

• Its sessions are held three times a year.

• Financial Action Task Force (FATF) President - Raja Kumar

List of FATF 

• Gray List – Countries that are considered safe havens for supporting terror funding and money laundering are placed on the FATF gray list.

• Black List - Countries identified as non-cooperative countries or regions are included in the black list. These countries support terrorist funding and money laundering activities.