In News:

• India will host the FATF Private Sector Collaborative Forum (PSCF) 2025 in Mumbai from March 25-27, 2025. This event will focus on global priorities such as payment transparency, financial inclusion, and the digital transformation of financial systems.
• The forum will be a critical platform for addressing the evolving challenges of money laundering and terrorist financing through the use of digital tools and enhanced transparency.

Key Agenda

The discussions at PSCF 2025 will revolve around tackling contemporary financial crimes, including those linked to cryptocurrency-related laundering. Key topics will include:

• Strengthening Anti-Money Laundering (AML) and Counter-Terrorist Financing (CFT) compliance mechanisms.
• Promoting financial inclusion through risk-based supervision of regulated entities.
• Enhancing transparency in beneficial ownership and using digital tools to bolster AML/CFT measures.
• Addressing emerging risks, including terrorist financing and proliferation financing.

The forum will also assess how the private sector can enhance information-sharing practices to address these threats more effectively.

About FATF

The Financial Action Task Force (FATF), established in 1989 during the G7 Summit in Paris, is an intergovernmental body that sets international standards to combat money laundering and terrorist financing. The FATF’s mission is to develop policies, establish guidelines, and promote global cooperation to mitigate the financial risks associated with these crimes.

• Headquarters: Paris, France.
• Membership: FATF has 39 member countries, including major economies such as the United States, India, China, Saudi Arabia, Germany, and theEuropean Union.
• Regional Bodies: In addition to its direct members, FATF affiliates over 180 countries through FATF-Style Regional Bodies (FSRBs) like the Asia Pacific Group (APG) and the Eurasian Group.
• FATF Recommendations are recognized as the global standard for AML/CFT measures.

FATF evaluates countries' efforts to comply with these standards, providing assessments and promoting policy changes to counteract financial crimes. Countries that fail to comply may be placed on the grey list or blacklist.

FATF Grey and Black Lists

Countries that fail to meet FATF standards are placed on one of two lists:

• Black List: Countries known as Non-Cooperative Countries or Territories (NCCTs), which directly support terrorist financing and money laundering. North Korea, Iran, and Myanmar are currently on this list.
• Grey List: Countries considered at risk of supporting financial crimes but not yet fully engaging in those activities. Being on the grey list serves as a warning, with the risk of moving to the blacklist if improvements are not made.

Countries on the blacklist face severe international sanctions, including restrictions on financial aid and economic interactions from organizations like the IMF, World Bank, and Asian Development Bank.

India's Role in FATF

India became a member of FATF in 2010 and has made significant strides in improving its AML/CFT frameworks. In 2024, FATF acknowledged India’s efforts towards anti-money laundering and countering terrorist financing, placing it in the "regular follow-up" category for continued compliance.

The upcoming PSCF 2025 will be a milestone in India’s ongoing commitment to global financial security, as it seeks to enhance international collaboration and discuss innovative ways to address evolving threats in financial crimes.