FATF Supervision Forum, Sanya, China

The EAG Secretariat took part in the first meeting of the FATF Supervisors' Forum, held on 11-12 November 2019 in Sanya (China) on the initiative of the FATF President, Liu Xiangmin.

The low effectiveness ratings awarded to the FATF member countries in the 25 assessments of their AML/CFT regimes conducted so far added relevance to the Forum. More than 100 supervisors from almost 50 countries gathered in Sanya.

Discussions focused on the three main areas of AML/CFT efforts: risk-based approach, new technologies and international cooperation. Participants leveraged FATF country reports as well as insights and best practices of the most accomplished supervisors and international institutions specializing in this subject matter to trigger discussions. 

Among the prevention challenges faced by countries are the lack of proper oversight over reporting entities representing the non-financial sector vis-à-vis financial institutions, a disproportionate sanctions regime, gaps in the understanding of the risk-based approach, the imbalance between on- and off-site inspections that fails to address contemporary risks, the lack of human and material resources, and the reluctance to use modern IT technologies.

As a medium-term objective, the Forum contributors plan to conduct an overview of supervisory and monitoring measures, draft a background note on supervisory tools, collect case studies on the effective use of information technologies, discuss best practices in the application of a risk-based approach, organize video conferences, and study the best experiences of other supervisors.

The next meeting of the Forum, this time with the participation of reporting entities, is scheduled for May 2020.

EAG Secretariat