AML: Insights From the FATF’s February Plenary Session

Last Friday, 21 February 2025, the second FATF Plenary under the Presidency of Elisa de Anda Madrazo of Mexico concluded. The event gathered representatives from over 200 jurisdictions and international organisations, focusing on pressing issues related to financial crime mitigation, financial inclusion and sanctions enforcement.

During the three-day discussions, FATF delegates reviewed key updates to AML/CFT standards, addressed high-risk jurisdictions and explored measures to enhance transparency in financial transactions whilst continuing to refine its regulatory framework in response to emerging risks, ensuring that financial institutions worldwide implement robust compliance measures. This latest Plenary reaffirmed the importance of a risk-based approach while balancing financial integrity and accessibility.

Revisions to FATF Standards and Financial Inclusion

Following extensive public consultation, the Plenary agreed to changes in the FATF Standards to promote a risk-based approach while encouraging financial inclusion. This initiative aims to facilitate access to banking services for the unbanked global population, aligning with FATF’s 2021 stocktake on de-risking and financial exclusion.

Combating Financial Flows Related to Online Child Sexual Exploitation

The FATF Plenary finalised a report on financial intelligence techniques to disrupt online child sexual exploitation, including cases involving live streaming and “sextortion”. The report will be launched at a London event on March 13, 2025, bringing together key stakeholders from the public and private sectors.

Updates on High-Risk and Monitored Jurisdictions

• Jurisdictions Added to Increased Monitoring: The FATF added Lao People’s Democratic Republic (Laos) and Nepal to its list of jurisdictions under increased monitoring, requiring them to implement strategic AML/CFT/CPF reforms.

• Jurisdictions Removed from Increased Monitoring: The Philippines was removed following a successful on-site review, demonstrating improvements in its AML/CFT/CPF framework.

• Suspension of the Russian Federation: The suspension of Russia’s FATF membership remains in effect, with ongoing calls for vigilance against circumvention of financial sanctions.

Strategic Initiatives & Public Consultations

• Payment Transparency & Proliferation Financing: The FATF launched public consultations on improving Recommendation 16 (payment transparency) and understanding complex proliferation financing and sanctions evasion schemes.

• Horizontal Review of Gatekeepers’ Compliance: The FATF encouraged stronger AML/CFT compliance among lawyers, accountants, real estate agents and trust service providers, recognising their role in countering financial crime.

• Women in FATF & Global Network Initiative: The FATF expanded its mentorship programs to encourage female leadership within financial intelligence and regulatory agencies.

cleversoft’s Jurisdictional Risk Update

As financial crime risks evolve, cleversoft continues to assess and adapt to jurisdictional changes based on the latest FATF updates. These updates provide businesses with critical insights into regulatory shifts, allowing them to maintain compliance and mitigate risk exposure.

Summary of Key Changes:

1. Philippines Risk Level Update: Although the Philippines has been removed from FATF’s increased monitoring list, cleversoft maintains it as a high-risk jurisdiction due to its continued presence on the EU Commission’s list of high-risk jurisdictions.

2. Increased Monitoring for Lao PDR & Nepal: While the FATF recently added Lao PDR and Nepal to its increased monitoring list, there are no changes in cleversoft’s risk assessment due to both countries being already classified as high risk jurisdictions due to other factors.

cleversoft Services

Our Financial Crime Prevention Suite ensures your organization stays ahead of regulatory changes with real-time jurisdiction risk monitoring, comprehensive AML screening, and automated regulatory alerts. We integrate updated FATF standards into our solutions, providing you with the tools needed to navigate this evolving regulatory landscape.

Explore our Financial Crime Prevention Suite or contact our sales team to learn how we can strengthen your compliance framework.

Source: Outcomes FATF Plenary, 19-21 February 2025