5. Global AFC Standards and Guidance Flashcards

Vocabulary flashcards covering international Anti-Financial Crime (AFC) standards, organizations, regulations, and risk assessment frameworks.

Financial Action Task Force (FATF)

An international organization established in 1989 by the G-7 to coordinate global efforts to combat money laundering and terrorist financing.

FATF 40 Recommendations

A comprehensive set of international standards and action plans issued by FATF that set forth guidance for fighting money laundering, terrorist financing, and proliferation financing.

FATF-Style Regional Bodies (FSRBs)

Autonomous regional organizations, such as MONEYVAL, that operate as FATF associate members to assist in implementing FATF standards across their respective regions.

Palermo Convention (2000)

A UN treaty that addressed organized crime, money laundering, and corruption, encouraging governments to adopt stricter financial crime controls.

FATF Grey List

Officially named 'Jurisdictions Under Increased Monitoring,' this list identifies jurisdictions with strategic AML/CFT deficiencies that are actively working with FATF to address them.

FATF Black List

Officially named 'High-Risk Jurisdictions Subject to a Call for Action,' this list identifies jurisdictions with significant AML/CFT deficiencies, prompting members to apply enhanced due diligence and potential countermeasures.

Customer Due Diligence (CDD) Recordkeeping Requirement

Under FATF Recommendations 10 and 11, financial institutions must retain transaction records and CDD information for at least five years.

FATF 11 Immediate Outcomes (IOs)

Key areas of focus and outcomes used by FATF during mutual evaluations to measure and rate the operational effectiveness of a jurisdiction's AML/CFT framework.

Stages of the FATF Mutual Evaluation Process

The seven-stage peer review process that includes: Getting started, Technical review, Scoping note, On-site visit, Draft MER, FATF plenary adoption, and Publication and follow-up.

International Cooperation Review Group (ICRG)

A group within FATF that oversees the review process to identify high-risk and noncooperative jurisdictions based on threat, vulnerability, and deficiency criteria.

Global Programme Against Money Laundering (GPML)

An initiative by the UN General Assembly that assists Member States in developing robust AML legal frameworks, institutional infrastructure, and technical skills.

UN Security Council Resolution 1373 (2001)

A UN Security Council resolution adopted post-9/11 requiring Member States to criminalize terrorist financing and enact asset-freezing measures.

Reference Guide to Anti-Money Laundering and Combating the Financing of Terrorism

The primary AML/CFT resource jointly published by the World Bank and the International Monetary Fund (IMF).

OECD Convention on Combating Bribery

A 1997 international agreement that focuses on the supply side of corruption by requiring signatory countries to criminalize the bribery of foreign public officials in international business transactions.

Three Lines of Defense (BCBS Guidelines)

A risk management model in banking where operational business units act as the first line, AML compliance and internal controls act as the second line, and internal audit acts as the third line.

Egmont Group

An international network of national Financial Intelligence Units (FIUs) established in 1995 to facilitate cooperation, secure information sharing, and capacity building.

Wolfsberg Group

An association of global banks formed in 2000 that develops policies and guidance for managing financial crime risk, including principles for private and correspondent banking.

International Organization of Securities Commissions (IOSCO)

The global standard setter for financial market regulation, establishing principles for market integrity, investor protection, collective investment schemes, and crypto/digital assets.

Corruption Perceptions Index (CPI)

A ranking published by Transparency International that scores approximately 180 jurisdictions from 0 (highly corrupt) to 100 (very clean) based on perceived public sector corruption.

Basel AML Index

An independent ranking tool developed by the Basel Institute on Governance through ICAR that evaluates a country's vulnerability to money laundering using 17 indicators across 5 domains.

Financial Secrecy Index

A biennial index published by the Tax Justice Network that ranks jurisdictions based on the extent of financial secrecy allowed and the scale of foreign financial services offered.