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China becomes vice-chair of FATF
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Why is it in news?
India congratulates China on its election as vice-president of FATF
Details
- India on Sunday congratulated China on its election as vice-president of the global money laundering watchdog, the Financial Action Task Force (FATF).
- This development that comes on the back of news reports and speculation that a deal on giving China a larger role in the FATF had been reached, following which Beijing agreed to drop its objections to Pakistan being put under scrutiny by the body.
- The Indian delegation at the FATF struck a deal with the Chinese team that related to support for a greater FATF role for Beijing in the future. China then dropped its objections paving the way for Pakistan to be “grey listed”—a move that is expected to impact heavily on Pakistan’s economy given that Pakistan will find it difficult to raise funds from international sources.
About FATF
- The Financial Action Task Force (FATF) is an inter-governmental body established in 1989 by the Ministers of its Member jurisdictions.
- The objectives of the FATF are to set standards and promote effective implementation of legal, regulatory and operational measures for combating money laundering, terrorist financing and other related threats to the integrity of the international financial system.
- The FATF is therefore a “policy-making body” which works to generate the necessary political will to bring about national legislative and regulatory reforms in these areas.
- The FATF monitors the progress of its members in implementing necessary measures, reviews money laundering and terrorist financing techniques and counter-measures, and promotes the adoption and implementation of appropriate measures globally.
- In collaboration with other international stakeholders, the FATF works to identify national-level vulnerabilities with the aim of protecting the international financial system from misuse.
- The FATF's decision making body, the FATF Plenary, meets three times per year.
- The FATF has developed a series of Recommendations that are recognised as the international standard for combating of money laundering and the financing of terrorism and proliferation of weapons of mass destruction. They form the basis for a co-ordinated response to these threats to the integrity of the financial system and help ensure a level playing field. First issued in 1990, the FATF Recommendations were revised in 1996, 2001, and 2003 and most recently in 2012 to ensure that they remain up to date and relevant, and they are intended to be of universal application.
Source
The Hindu