Guidance for a risk-based approach: effective supervision and enforcement by AML/CFT supervisors of the financial sector and law enforcement

The FATF issued guidance on effective supervision and enforcement by AML/CFL supervisors of the financial sector and law enforcement. The financial services sector play a key role in preventing ML/TF related funds from flowing through the international financial system. Supervision of this sector, and the ability to take effective, dissuasive and proportionate enforcement actions in the case of AML/CFT breaches are therefore essential. This guidance describes the features of effective supervision by regulators and supervisors, and also clarifies the interplay with the role of law enforcement agencies.

A range of illustrative case examples are provided which aim to assist jurisdictions in undertaking effective supervision of their financial sector in a manner that is appropriate to the sector’s size and complexity, and the degree of ML/TF risk to which it is exposed.