On this page, We are going to learn about the full form of FATF and the meaning of FATF, As well as the meaning, definition, and acronym for FATF in different categories. So you should read this post till the end.
The Full Form of FATF: Financial Action Task Force
FATF Stands for Financial Action Task Force. The FATF is an intergovernmental organization. FATF was established in 1989 in Paris with the consent of the G7 countries. Its purpose is to prevent Terror Funding and Money Laundering of Weapons of Mass Destruction internationally.
It prohibits its member countries from engaging in activities such as terror funding and money laundering. Its member countries include many more countries like India, America, Russia, Britain, and China.
Currently, FATF has 37 member nations, including India, and 2 regional organizations. Since 2010, India has been a FATF member.
How Does the FATF Work
When it comes to terror funding and money laundering, the FATF takes two types of action. Countries are listed on the gray list due to their involvement in terror funding and money laundering. The country is also blacklisted if no action is taken.
- GRAY List by FATF
Any nation that appears on the FATF’s Grey List means that country has failed to stop the funding of terrorism and money laundering.
- Black List by FATF
Any country on the ‘black’ list of FATF means that that country will stop getting financial aid from international financial institutions.
There are very strict conditions that must be met before a country on the gray list can seek assistance from an international monetary body such as the IMF, ADB, or World Bank. It is difficult for most institutions to lend money. Moreover, there are problems with trade as well.
Disadvantages of being on the gray list
Any financial body, such as the World Bank, the World Bank, or the IMF, does not provide financial assistance. The business is taken over by multinational companies. Negative ratings were assigned to rating agencies. Overall, the economy reaches the brink of destruction.