A Plenary meeting of the Financial Action Task Force (FATF) was held in Paris on February 19-24, 2017. The Russian delegation, comprising representatives of Rosfinmonitoring, Foreign Ministry, Federal Security Service, Prosecutor General's Office, Ministry of Finance, Bank of Russia and the Assay Chamber of the Russian Federation, was headed by Rosfinmonitoring Director Yury Chikhanchin.
In the context of increasing terrorist risks in the world, the CFT subject continues to top the international agenda. The Russian Federation presented the results of its efforts to identify and cut off funding for ISIL, highlighting once again the importance of concerted international action in this area.
D. Feoktistov, a representative of the Russian Foreign Ministry, briefed the participants on progress in compiling the national register of individuals and entities known to be involved in terrorist and extremist activities, 1400 of whom have been identified and added to the list in the past 2 years.
1500 bank accounts with about US$120,000 belonging to the listed persons were frozen, including to those directly involved in terrorist financing, raising funds and acting on behalf of ISIL. Funding channels used by 382 ISIL-backed foreign terrorist fighters and 82 individual members of ISIL terrorist cells operating in Russia were identified and reported to law enforcement authorities. It was stressed that the fight against ISIL was a common goal for all stakeholders.
Faced with dwindling oil revenues, which have almost halved, ISIL is actively seeking new income sources, including kidnapping for ransom and fundraising.
In this regard, of particular concern is the growing share of remittances from various charity funds and NPOs in ISIL's revenue, with funding being channelled both to the conflict zone and "sleeping cells". Although the names of companies may change, the following tend to remain unchanged:
- specific remittance senders;
- NPO founders and directors;
- remittance recipients.
In order to further advance our approaches to combating terrorist financing, Russia initiated a typological study "Financing of Terrorist Recruitment", which has already attracted considerable interest from 19 delegations, including such international organizations as UN, INTERPOL and Europol, all of whom confirmed their desire to join the working group, headed by Russia and Spain.
During the first meeting of this group, participants approved a questionnaire, prepared by the Russian Federation, the deadline for the study completion and agreed on the further course of action, which includes holding a FATF-sponsored workshop in Moscow in April 2017.
The working group of the new joint typological study tasked with researc into lone-wolf terrorism will also include representatives of the Egmont Group and FATF.
As part of the efforts to coordinate technical assistance programmes, participants expressed their willingness to share the experience and best practice of the International Training and Methodological Centre, established by Rosfinmonitoring. Notably, the FATF President, in his meeting with Yury Chikhanchin, praised the ITMCFM for its work and asked for an opportunity to visit the centre personally as part of his attendance of the April workshop.
During a traditional FATF-sponsored meeting of FIU Heads, Russia unveiled its latest initiative aimed at identifying and suppressing the activities of cross-border "illicit financial intermediaries". The new initiative has already attracted the support of countries both within the EAG and FATF, including the USA, Canada, Australia, New Zealand, Germany and the Netherlands, paving the way for a decision to set up an ad hoc working group.
The Plenary meeting was attended by French Finance Minister Michel Sapin, who marked the importance of FATF's work to combat terrorist financing, highlighting its success. However, the real purpose of the French government's impressive contingent at the meeting was a potential change in the FATF's legal status that would make it independent from the OECD. Although the FATF's status is already being discussed as part of the midterm review of the FATF Mandate, the final decision has yet to be made. In addition, in order to increase the effectiveness of the Group's activities, the issue of transition to the biennial presidency is being considered.
The Plenary updated the list of jurisdictions with strategic shortcomings in the national AML/CFT systems.
Following a review, the blacklist remained unchanged (North Korea and Iran), despite the lifting of countermeasures against Iran.
The approval of the Mutual Evaluation Report of Sweden as part of the 4th round went on as planned. Following its review, the country was placed on the enhanced follow-up process and required to report its progress in addressing the identified deficiencies once a year.
The Russian delegation attended the already traditional meetings of the BRICS AML/CFT Council and the EAG Consultative Meeting, as well as held negotiations with a number of key delegations of FATF member countries on topical issues of bilateral cooperation.