The Financial Action Task Force (FATF) is seeking views, primarily from financial institutions and designated non-financial businesses and professions (DNFBPs) in its development of Guidance to help both public and private sectors implement new requirements to identify, assess, understand and mitigate proliferation financing risk.
The Guidance seeks to assist both sectors conduct proliferation financing risk assessments and apply corresponding risk mitigation measures.
The FATF is consulting private sector stakeholders on a draft version of the Guidance before finalising and publishing it and is seeking views in particular in four areas.
Is it clear?
The task force wants to know if the Guidance provides sufficient clarity in distinguishing the mandatory requirements of the updated FATF standards on proliferation financing risk assessment and mitigation and additional measures that may support the implementation of these new requirements.
The FATF also wants to know if the risk mitigation section of the Guidance provides sufficient clarity on how financial institutions and DNFBPs can address the risk of potential breach, non-implementation and evasion of targeted financial sanctions and what specific risk mitigation measures are already taken to address such risks.
Risk categories and customers
The task force is also seeking views on whether financial institutions and DNFBPs consider the four categories of risk indicators – including a sectoral focus on the maritime sector and trade finance – to be relevant, useful, and sufficient for their understanding of the risk of potential breach, non-implementation of evasion of proliferation financing targeted financial sanctions in the context of FATF recommendations.
Finally the FATF is seeking opinions on whether the Guidance sets clear expectations for financial institutions and DNFBPs in case of high-risk and low-risk customers and business relationships, including likely impact on de-risking and financial inclusion.
The deadline for responses is 9 April 2021.
More details on FATF’s public consultation on its Guidance on proliferation financing risk assessment and mitigation and a link to download the draft Guidelines can be found here.
Categories: Trade Based Financial crimes News