December 10, 2021

The Financial Action Task Force (FATF), the leading international anti-money laundering body, published its annual report for the period 01.07.2020 - 30.06.2021. We summarize the most important contents for you below.

In the first year of the German presidency, the FATF faced major challenges. In particular, the Corona pandemic had a significant impact on global money laundering activities last year. While the situation created new opportunities for criminals in money laundering and terrorist financing, governments struggled to detect, investigate, and prosecute money laundering activities. In the wake of the current challenges, the FATF identified relevant issues and set standards for them.

The report focuses on digital transformation. The panel launched a series of projects and concluded that digital technologies such as artificial intelligence, machine learning and big data analytics will bring significant changes to the fight against money laundering. While these technologies show great potential, manual human verification will always have significant importance, he said. In the report, "Suggested actions to support the use of new technologies for AML/CFT," the FATF creates a framework for successfully harnessing digital potential.

Furthermore, the FATF highlights the importance of money laundering in the area of environmental crime. Illegal wildlife trafficking, forestry crime, illegal mining and waste trafficking are said to generate billions of euros in revenue and have a significant impact on the destruction of the environment. CURENTIS has also reported on the problem on several occasions (see, for example, https://curentis.com/anti-money-laundering-bekaempft-umweltkriminalitaet-beispiel-illegale-goldminen/). Against the backdrop of worsening environmental costs, the FATF expanded its framework for combating environmental crime. The report "Money Laundering from Environmental Crime" emphasizes that cooperation across authorities and national borders, involving all relevant entities, is an important prerequisite for effectively combating environmental crime and the associated money laundering activities.

Another priority of the FATF for 2020 was trade-based money laundering. The starting point here is the analysis of the money laundering activities that hide trillions of dollars in international trade. This type of money laundering is one of the methods that is used most frequently and at the same time presents enormous complexity. To create a basic understanding and support for governments, the FATF produced detailed reports to identify trends and developments, as well as risk indicators on trade-based money laundering.

Furthermore, in the context of ethnically or racially motivated terrorism, initiatives have been launched to identify common structural characteristics and funding patterns for this complex phenomenon. In addition, new guidelines have been drafted to help ensure international peace and security. This represents guidance on international risk reduction of financially sanctioned areas, such as weapons of mass destruction financing.

Source: https://www.fatf-gafi.org/publications/fatfgeneral/documents/annual-report-2020-2021.html