Financial Transparency Coalition

Letter to the Financial Action Task Force (FATF)

Members of the Task Force on Financial Integrity and Economic Development and other signatories identified three key points for the Financial Action Task Force (FATF) to consider at its upcoming plenary meeting this month in a letter sent on June 11.

First, the Task Force on Financial Integrity and Economic Development offered suggestions on how to respond to FATF Recommendations 33 and 34, which are still debated. Recommendation 33 states the following:

Countries should take measures to prevent the unlawful use of legal persons by money launderers. Countries should ensure that there is adequate, accurate and timely information on the beneficial ownership and control of legal persons that can be obtained or accessed in a timely fashion by competent authorities. In particular, countries that have legal persons that are able to issue bearer shares should take appropriate measures to ensure that they are not misused for money laundering and be able to demonstrate the adequacy of those measures. Countries could consider measures to facilitate access to beneficial ownership and control information to financial institutions undertaking the requirements set out in Recommendation 5.

Recommendation 34 similarly states that preventive measures should be taken against the “unlawful use of legal arrangements by money launderers” [emphasis added]. The Task Force explains that public registries of beneficial ownership of companies is the “only meaningful option” to prevent misuse.

The second point by the Task Force calls for a list of jurisdictions that are failing to meet the FATF’s standards. In addition, a revised measure of the implementation of this legislation should be used for the fourth round of evaluations.

Finally, the Task Force would like to be involved in the open review process.

Task Force coordinating committee members Gavin Hayman, Campaigns Director, Global Witness; Raymond Baker, Director, Global Financial Integrity; John Christensen, Director, Tax Justice Network; Richard Murphy, Tax Research LLP; Alex Cobham, Chief Policy Adviser, Christian Aid; Francois Valerian, Head of Private Sector Programmes, Transparency International; and Marta Ruiz, Senior Policy and Advocacy Officer, Eurodad signed the letter, as well as 20 other signatories.

To view the letter in PDF or full text format, click here.