Notes for Assessors

Contents

This template should be used as the basis for preparing Mutual Evaluation Reports (MERs) for evaluations conducted using the FATF’s 2013 Methodology. It sets out the structure of the MER, and the information and conclusions which should be included in each section.

The template incorporates guidance to assessors on how the MER should be written, including what information should be included, and the way analysis and conclusions should be presented. This guidance is clearly indicated in grey shaded text (like this section). It should not appear in the final MER.

Text which appears in unshaded script (including chapter and section headings and pro-forma paragraphs) should be included in the final report (with any square brackets completed as necessary).

Assessors should note that a completed MER is expected to be 100 pages or less (together with a technical annex of 60 pages or less). There is no predetermined limit to the length of each chapter, and assessors may decide to devote more, or less, attention to any specific issue, as the country’s situation requires. Nevertheless, assessors should ensure the MER does not become excessively long, and should be prepared to edit their analysis as necessary. In order to ensure the right balance in the final report, assessors should aim to summarise technical compliance with each Recommendation in one or two paragraphs, totalling a maximum of half a page. Assessors may be very brief on issues where there is little or no substance to report (e.g. a single sentence description of technical compliance would be sufficient for Recommendations rated “compliant”).

The Executive Summary is intended to serve as the basis for Plenary discussion of each Mutual Evaluation, and to provide clear conclusions and recommendations for ministers, legislators, and other policymakers in the assessed country. It is therefore important that it does not exceed five pages, and that assessors follow the guidance in that section on the selection and presentation of issues.

Assessors are urged to include statistics and case studies where relevant. These should be provided in the format shown at the end of the template.

Executive Summary

Mutual Evaluation Report of [Country]

1. This report summarises the AML/CFT measures in place in [name of assessed country] as at the date of the on-site visit [date]. It analyses the level of compliance with the FATF 40 Recommendations and the level of effectiveness of [country]’s AML/CFT system, and provides recommendations on how the system could be strengthened.

Key Findings

1.  
2. Assessors should provide a short summary of the key findings, both positive and negative, taking into account the country’s risk profile and AML/CFT regime. The focus should be on 5-7 points raised in the report rather than a summary of each and every single IO or chapter.

Risks and General Situation

3. This section should give a brief summary (1-2 paragraphs) of the country’s ML/TF risk situation and context – focusing in particular on the country’s exposure to domestic and international ML/TF risks, and identifying the issues and sectors that present the greatest risks. Assessors should note any areas where they have identified material risks which were not considered in the country’s own risk assessment, or where they consider the level of risk to be significantly different.

Overall Level of Compliance and Effectiveness

4.  
5. Assessors should give a very brief overview of the AML/CFT situation in the country, based on the level of both compliance and effectiveness.
6. In the sections below, assessors should briefly summarise, the overall level of effectiveness of the country’s AML/CFT system in each thematic area as well as the overall level of technical compliance with the FATF Recommendations, noting any areas of particular strength or weakness. Assessors should also note the progress since the last MER, highlighting any significant changes and flagging any key issues that remain outstanding from the previous assessment.

Assessment of risk, coordination and policy setting (Chapter 2; IO.1, R.1, 2, 33 & 34)

7.  
8. Assessors should set out their main findings in more details and for each chapter of the main report as structured in sub-sections below. Any relevant factors of importance would need to be highlighted such as high-risk or significant contextual or other issues for the country; areas where the country performs particularly well both on effectiveness and technical compliance, highlighting unusual or innovative mechanisms; significant failures of effectiveness; and important areas of technical non-compliance. Each section should contain a brief summary of the assessor’s conclusions on the overall level of compliance and effectiveness – including highlighting key findings for each relevant IOs- and any actions required. The description should include sufficient detail for readers to understand assessors’ conclusions and the main issues/positive features. However, it should not include a full analysis, and should not defend assessors’ conclusions or anticipate and rebut objections. Any additional information should be set out in the main body of the report, rather than in the executive summary.

Financial intelligence, ML investigations, prosecutions and confiscation (Chapter 3; IO.6, 7, 8; R.1, 3, 4, 29–32)

9.  

Terrorist and proliferation financing (Chapter 4; IO.9, 10, 11; R. 1, 4, 5–8, 30, 31 & 39.)

10.  

Preventive measures (Chapter 5; IO.4; R.9–23)

11.  

Supervision (Chapter 6; IO.3; R.14, R.26–28, 34, 35)

12.  

Transparency and beneficial ownership (Chapter 7; IO.5; R.24, 25)

13.  

International cooperation (Chapter 8; IO.2; R.36–40)

14.  

Priority Actions

1.  
2.  

The report should set out a series of priority actions that the country should take:

Assessors should set out the priority actions which the country should take to improve its AML/CFT system. This can include measures to improve effectiveness; to address technical compliance problems; or to tackle structural or cross-cutting issues.

Assessors should indicate briefly what action is required and the reason why it should be prioritised (e.g. that it is a fundamental building block of the AML/CFT system).

The actions identified will normally correspond to the issues set out in the key findings section above – but need not always do so, e.g. if assessors identify scope for a single action to address a number of deficiencies which are not included in the key findings.

The priority actions should normally take up one page or less.

If assessors identify actions which offer the opportunity to make a significant improvement quickly or at a relatively low cost, these should also be highlighted in this section

Effectiveness & Technical Compliance Ratings

Table 1. Effectiveness Ratings

IO.1	IO.2	IO.3	IO.4	IO.5	IO.6	IO.7	IO.8	IO.9	IO.10	IO.11

Note: Effectiveness ratings can be either a High- HE, Substantial- SE, Moderate- ME, or Low – LE, level of effectiveness.

Table 2. Technical Compliance Ratings

R.1	R.2	R.3	R.4	R.5	R.6	R.7	R.8	R.9	R.10
R.11	R.12	R.13	R.14	R.15	R.16	R.17	R.18	R.19	R.20
R.21	R.22	R.23	R.24	R.25	R.26	R.27	R.28	R.29	R.30
R.31	R.32	R.33	R.34	R.35	R.36	R.37	R.38	R.39	R.40

Note: Technical compliance ratings can be either a C – compliant, LC – largely compliant, PC – partially compliant or NC – non compliant.

№	Title
	Preface
1	ML/TF risks and context
2	National AML/CFT policies and coordination
3	Legal system and operational issues
4	Terrorist financing and financing of proliferation
5	Preventive measures
6	Supervision
7	Legal persons and arrangements
8	International cooperation
	TECHNICAL COMPLIANCE ANNEX

15.  
16. 16. This section should begin with a very brief description of the country’s general situation: its size, territorial makeup, population, GDP, and constitutional structure.
17. 17. This section should note any territorial or jurisdictional issues affecting the evaluation,(e.g. if the MER includes assessment of territories or regions with different AML/CFT regimes, or if the country is part of a supranational jurisdiction).
18. For any of the information contained in sub-sections 1.1-1.4, assessors should provide a balanced picture where possible thus covering, for example, higher risk or lower risk areas, strengths and weaknesses.

1.1 ML/TF Risks and Scoping of Higher-Risk Issues

1.1.1 Overview of ML/TF Risks

19.  
20. This section should set out the ML and TF threats and risks faced by the country. It should include the main underlying threats, drawing on the country’s risk assessment and on other relevant information, as set out in the introduction to the methodology. Particular points to cover include:
    • the underlying levels of proceeds generating crime in the country, and its nature;
    • the country’s exposure to cross-border illicit flows (related to crimes in other countries) – including any significant potential role as a transit route for illicit goods or funds;
    • any available information on the country’s exposure to terrorist financing threats (including the existence of terrorist groups active in the country; or the use of the country as a source of funds or recruits for terrorist groups active in other countries) and financing of proliferation; and
    • the ML/TF risks, taking into account vulnerabilities (including vulnerabilities posed by virtual asset activity) and consequences.

1.1.2 Country’s risk assessment & Scoping of Higher Risk Issues

21.  
22. The above should be framed in the context of the country’s understanding and assessment of its own risks. Assessors should set out the arrangements for the preparation of the National Risk Assessment(s), including how the risk assessment(s) was commissioned, how it is structured (e.g. as a single assessment or on the basis of regional/sectoral assessments), how it was prepared and the type of information used in conducting the risk assessment(s), as well as assessors’ conclusions on the adequacy of the process. Assessors should set out their views regarding the reasonableness of the conclusions of the assessment(s), as well as any points on which they consider the conclusions were not reasonable, and any additional risks or risk factors which they consider significant, but which were not adequately taken into account in the assessment. If assessors identify such additional risks, they should note the basis for their judgement, and the credible or reliable sources of information supporting this. In addition assessors should summarise the scoping exercise conducted prior to the onsite in order to identify higher and lower risk issues to be considered in more detail in the course of the assessment. This should include setting out the reasons why they consider each issue to be higher or lower risk, and noting how additional attention was given to these issues in the course of the evaluation.

1.2 Materiality

23.  
24. This section should set out the size and general makeup of the economy, and of the financial sector, DNFBP and VASP sectors. It should note the relative importance of different types of financial institution, DNFBP and VASP and their activity, the international role of the country’s financial, DNFBP and VASP sectors (e.g. if the country is a regional financial centre, an international financial centre, a centre for company formation and registration), and highlight particularly significant features of the country’s financial, DNFBP and VASP sectors. This section should also note any other significant factors affecting materiality, as set out in paragraph 8 of the introduction to the Methodology. It should be a brief summary.

1.3 Structural Elements

25.  
26. 26. Assessors should note whether the main structural elements required for an effective AML/CFT system are present in the country (as set out in paragraph 9 of the introduction to the Methodology).
27. If there are serious concerns that any of the structural elements which underpin an effective AML/CFT system is weak or absent, assessors should highlight those concerns in this section. Note that assessors are not expected to reach a general conclusion about the extent to which such factors are present.

1.4 Background and other Contextual Factors

28.  
29. Assessors should note domestic and international contextual factors that might significantly influence the effectiveness of the country’s AML/CFT measures. This could include such factors as the maturity and sophistication of the AML/CFT regime and the institutions which implement it, or issues of corruption or financial exclusion. All other background information necessary for the understanding of the effectiveness analysis in the main chapters of the report should be incorporated here as well including the following:

1.4.1 AML/CFT strategy

30.  
31. This section should set out the main policies and objectives of the Government for combating money laundering and terrorist financing. It should describe the government’s priorities and objectives in these areas, noting where there are also wider policy objectives (such as financial inclusion) which affect the AML/CFT strategy. Any relevant policies and objectives for combating the financing of proliferation should also be set out in this section.

1.4.2. Legal & institutional framework

32.  
33. Assessors should give a brief overview of which ministries, agencies, and authorities are responsible for formulating and implementing the government’s AML/CFT and proliferation financing policies. Assessors should briefly describe the principal role and responsibilities of each body involved in the AML/CFT strategy, as well as noting the bodies responsible for combating the financing of proliferation. Assessors should indicate any significant changes since the last MER to the institutional framework, including the rationale for those changes. This section should also set out the country’s legal framework for AML/CFT and proliferation financing in a brief summary form. Detailed description and analysis of each element is not necessary – this should be included in the technical annex. Assessors should describe the co-operation and coordination mechanisms used by the country to assist the development of AML/CFT policies, and policies for combating the financing of proliferation.

1.4.3 Financial sector, DNFBPs and VASPs

34.  
35. 35. In this section, assessors should describe the size and makeup of the financial sector, DNFBP and VASP sectors. The section should note the relative importance of different types of financial institutions and activity, DNFBPs and generic types of virtual asset activities and providers primarily being used in the country. It is important that assessors explain their weighting of the relative importance of the different types of financial institutions, DNFBPs and VASPs to ensure consistent weighting throughout the MER, particularly when assessing IO.3 and IO.4. This is important because the risks, materiality and context varies widely from country to country (e.g. in some countries, a particular type of DNFBP such as TCSPs or casinos may be as (or almost as) important as the banking sector which means that weak supervision or weak preventive measures in that sector would be weighted much more heavily in IO.3 and IO.4 than in countries where such sectors are of lesser importance).
36. 36. Assessors may explain how they have weighted the different sectors, in general terms (e.g. by explaining which sectors were weighted most important, highly important, moderately important or less important) rather than trying to rank each sector’s prevalence individually (e.g. 1, 2, 3, 4, 5, 6, 7, 8…) which would be overly granular and a rather artificial distinction given the many different types of financial institutions, DNFBPs and VASPs that are subject to the FATF Recommendations.
37. 37. In this section, the assessors should also describe the international role of the country’s financial sector – e.g. if the country is a regional financial centre, an international financial centre, or a centre for company formation and registration, and should highlight particularly significant or important features of the country’s financial, DNFBP and VASP sectors.
38. They should also summarise the types and key features of financial institutions, DNFBPs and VASPs which exist in the country, and the numbers of each type of institution, as well as some information relating to the materiality of the sector and the institutions within it. Tables may be used in order to summarise the information.

1.4.4 Preventive measures

39.  
40. This section should set out the legal (or other enforceable) instruments through which they are applied, and the scope of such obligations. If assessors identify any problems regarding the scope of AML/CFT obligations, they should briefly identify such issues in this section. If countries have exempted specific sectors or activities from the requirements, these exemptions should be noted in this section. Assessors should indicate whether such exemptions meet the criteria set out in R.1, and whether they consider the exemptions justified on the basis of the country’s ML/TF risk assessment(s). This section should also note cases where countries have decided, on the basis of risk, to require AML/CFT preventive measures to be applied by additional sectors which are normally outside the scope of the FATF Recommendations.

1.4.5 Legal persons and arrangements

41.  
42. Assessors should briefly describe the types of legal persons and legal arrangements that can be established or created in the country and relevant from an AML/CFT perspective. Basic characteristics of these should be provided as well as their numbers and their significance within the country and in financial and DNFBP sectors. Tables may be used in order to summarise the information. As per sub-section (c), the international elements should be covered in particular the extent to which the country acts as an international centre for the creation or administration of legal persons or arrangements (even if only as a source-of-law jurisdiction); and the extent to which legal persons and arrangements created in another jurisdiction (or under the law of another jurisdiction) hold assets or used in the country.

1.4.6 Supervisory arrangements103Assessors should describe the supervisory arrangements in place for financial institutions, DNFBPs and VASPs.

43.  
44. Assessors should set out the institutional arrangements for supervision and oversight of financial institutions, DNFBPs and VASPs, including the roles and responsibilities of regulators, supervisors and SRBs; their general powers and resources. Similarly, this section should also note the institutional framework for legal persons and arrangements, including the authorities (if any) with responsibility for the creation, registration, and supervision of legal persons and arrangements.

1.4.7 International Cooperation

45.  
46. Assessors should briefly summarise the international ML/TF risks and threats faced by the country, including the potential use of the country to launder proceeds of crime in other countries and vice-versa. To the extent possible, assessors should identify the country’s most significant international partners with respect to ML/TF issues. This section should also note any institutional framework for international cooperation e.g. a Central Authority for MLA.

Table 1.1. <Sample table>

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	Note to assessors: please ensure that tables and boxes are numbered per Chapter
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Note: <!!Add the note here. If you do not need a note, please delete this line.!!>
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Box 1.1. <Sample Case Study box (enter title here)>

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Note: <!!Add the note here. If you do not need a note, please delete this line.!!>
Source: <!!Add the source here. If you do not need a source, please delete this line.!!>

2.1. Key Findings and Recommended Actions

Key Findings

1.  
2. Assessors should briefly summarise their conclusions for this chapter, highlighting the most significant findings. Key findings and key recommended actions should be consistent on the substance without a need to strictly mirror each other.

Recommended Actions

1. This section should set out a targeted and prioritised set of recommendations on how the country should improve its level of effectiveness and its level of compliance with the FATF Recommendations. The section should include assessors’ recommendations regarding the Immediate Outcomes and Recommendations covered in this chapter of the MER. Assessors will therefore need to consider a range of Outcomes and Recommendations, and actions aimed at addressing both technical deficiencies and practical issues of implementation or effectiveness, and decide which actions should be prioritised.
2. Assessors should clearly indicate which Recommendation(s) or Outcome(s) each recommended action is intended to address. Assessors should follow the same general approach when making recommendations in other chapters of the MER.

47. The relevant Immediate Outcome considered and assessed in this chapter is IO.1. The Recommendations relevant for the assessment of effectiveness under this section are R. 1, 2, 33 and 34, and elements of R.15.

2.2 Immediate Outcome 1 (Risk, Policy and Coordination)

48. This section should set out assessors’ analysis of Immediate Outcome 1. The first paragraph(s) should note any general considerations regarding the country’s risks and context which affect the assessment.
49. 49. This section should also summarise assessors’ general impression of whether the country appears to exhibit the characteristics of an effective system.
50. Assessors should cover each of the Core Issues in their analysis. Assessors have some flexibility about how they organise the analysis in this section. For some immediate outcomes, it may be appropriate to consider each of the core issues in turn. For others (e.g. I.O.4) it may be better to set out the analysis sector-by-sector; or (e.g. for I.O.7) to proceed step-by-step with the analysis of each element of the process covered by the Outcome. Whichever approach assessors take to organising their analysis, they should ensure that they consider each of the core issues, and should highlight any general conclusions they reach on them. Assessors are required to resort to sub-headings to structure their analysis and clearly sign-post how core issues have been addressed. This does not preclude the use of additional sub-headings where necessary or to indicate that a particular Core Issue is not applicable in a particular country (and why). In the case of IO1, this includes the suggested sub-headings below.
51. Examples of sub-headings for other IOs are provided in this template. Assessors still retain full flexibility to amend and order these as most benefit their analysis and the overall report. Similarly, assessors may add or delete sub-headings as they see fit and in line with the specific circumstances of the assessed country. In all cases sub-headings should be neutral and not provide any qualitative comment as to how the country is performing on a given IO. Assessors should note the main sources of information and evidence used (e.g. the sources noted in sections (a) and (b) of the Immediate Outcome). Assessors are not required to use all the information noted in the methodology – but should set out here the information and evidence which has a material influence on their conclusion. Assessors should also note in their analysis any technical compliance issues which influence the level of effectiveness.

2.2.1 Country’s understanding of its ML/TF risks

52.  

2.2.2 National policies to address identified ML/TF risks

53.  

2.2.3 Exemptions, enhanced and simplified measures

54.  

2.2.4 Objectives and activities of competent authorities

55.  

2.2.5 National coordination and cooperation

56.  

2.2.6 Private sector’s awareness of risks

57.  

Overall Conclusion on IO.1

58. [Weighting and conclusion]
59. [Evaluated country] is rated as having a [rating] level of effectiveness for IO.1.
60. 60. At the end of this section, assessors should indicate the effectiveness rating for the Immediate Outcome. When deciding on the overall level of effectiveness, assessors should take into account: (a) the core issues, (b) any relevant technical compliance issues/deficiencies; (c) risks and contextual factors; and (d) the level of effectiveness in other Immediate Outcomes that are relevant. Assessors should briefly explain their conclusion on the appropriate effectiveness rating. They should be explicit about the weight and importance they attach to the elements taken into account. The conclusion should not duplicate the Key Findings section at the beginning of each chapter and should be, ideally, not more than one or two paragraphs long.
61. Assessors should follow the same general approach when setting out their analysis of effectiveness for all other outcomes.

The following are templates for tables and case studies for use in this section Chapter. Copy and paste where necessary, or remove.

Table 2.1. <Sample table>

<!!Type the subtitle here. If you do not need a subtitle, please delete this line.!!>

	Note to assessors: please ensure that tables and boxes are numbered per Chapter
<!!Table Row Heading (Alt+W)!!>	<!!Table Cell (Alt+E)!!>

Note: <!!Add the note here. If you do not need a note, please delete this line.!!>
Source: <!!Add the source here. If you do not need a source, please delete this line.!!>

Box 2.1. <Sample Case Study box (enter title here)>

<!!Box heading - If you do not need a box heading, please delete this line.!!>

<!! Do not forget to delete or replace this text.!!>

<!!Box heading 2!!>

Note: <!!Add the note here. If you do not need a note, please delete this line.!!>
Source: <!!Add the source here. If you do not need a source, please delete this line.!!>

3.1 Key Findings and Recommended Actions

Key Findings

1.  
2. Assessors should briefly summarise their conclusions for this chapter, highlighting the most significant findings. Key findings and key recommended actions should be consistent on the substance without a need to strictly mirror each other.

Recommended Actions

1.  
2. Assessors should list all the main corrective actions required for the country to improve its level of effectiveness and technical compliance in a targeted and prioritised way. Assessors should clearly indicate which IO/REC the recommended actions relate to.

62. The relevant Immediate Outcomes considered and assessed in this chapter are IO.6-8. The Recommendations relevant for the assessment of effectiveness under this section are R.1, R. 3, R.4 and R.29-32 and elements of R.2, 8, 9, 15, 30, 31, 34, 37, 38, 39 and 40.

3.2 Immediate Outcome 6 (Financial Intelligence ML/TF)

63. This Immediate Outcome relates to both money laundering and the financing of terrorism. Assessors should note any issues which relate specifically to either ML or TF. Sub-headings related to core issues could include:

3.2.1. Use of financial intelligence and other information

64.  

3.2.2. STRs received and requested by competent authorities

65.  

3.2.3. Operational needs supported by FIU analysis and dissemination

66.  

3.2.4. Cooperation and exchange of information/financial intelligence

67.  

Overall conclusion on IO.6

68. [Weighting and conclusion: See IO.1 for instructions]
69. [Evaluated country] is rated as having a [rating] level of effectiveness for IO.6.

3.3 Immediate Outcome 7 (ML investigation and prosecution)

3.3.1. ML identification and investigation

70.  

3.3.2. Consistency of ML investigations and prosecutions with threats and risk profile, and national AML policies

71.  

3.3.3. Types of ML cases pursued

72.  

3.3.4. Effectiveness, proportionality and dissuasiveness of sanctions

73.  

3.3.5. Use of alternative measures

74.  

Overall conclusion on IO.7

75. [Weighting and conclusion: See IO.1 for instructions]
76. [Evaluated country] is rated as having a [rating] level of effectiveness for IO.7.

3.4 Immediate Outcome 8 (Confiscation)

3.4.1. Confiscation of proceeds, instrumentalities and property of equivalent value as a policy objective

77.  

3.4.2. Confiscation of proceeds from foreign and domestic predicates, and proceeds located abroad

78.  

3.4.3. Confiscation of falsely or undeclared cross-border transaction of currency/BNI

79.  

3.4.4. Consistency of confiscation results with ML/TF risks and national AML/CFT policies and priorities

80.  

Overall conclusion on IO.8

81. [Weighting and conclusion: See IO.1 for instructions]
82. [Evaluated country] is rated as having a [rating] level of effectiveness for IO.8.

The following are templates for tables and case studies for use in this section Chapter. Copy and paste where necessary, or remove.

Table 3.1. <Sample table>

<!!Type the subtitle here. If you do not need a subtitle, please delete this line.!!>

	Note to assessors: please ensure that tables and boxes are numbered per Chapter
<!!Table Row Heading (Alt+W)!!>	<!!Table Cell (Alt+E)!!>

Note: <!!Add the note here. If you do not need a note, please delete this line.!!>
Source: <!!Add the source here. If you do not need a source, please delete this line.!!>

Box 3.1. <Sample Case Study box (enter title here)>

<!!Box heading - If you do not need a box heading, please delete this line.!!>

<!! Do not forget to delete or replace this text.!!>

<!!Box heading 2!!>

Note: <!!Add the note here. If you do not need a note, please delete this line.!!>
Source: <!!Add the source here. If you do not need a source, please delete this line.!!>

4.1. Key Findings and Recommended Actions

Key Findings

1.  
2. Assessors should briefly summarise their conclusions for this chapter, highlighting the most significant findings. Key findings and key recommended actions should be consistent on the substance without a need to strictly mirror each other.

Recommended Actions

1.  
2. Assessors should briefly list the main corrective actions required for the country to improve its level of effectiveness and technical compliance. Assessors should clearly indicate which IO/REC the recommended actions relate to.

83. The relevant Immediate Outcomes considered and assessed in this chapter are IO.9-11. The Recommendations relevant for the assessment of effectiveness under this section are R. 1, 4, 5–8, 30, 31 and 39, and elements of R.2, 14, 15, 16, 32, 37, 38 and 40.

4.2. Immediate Outcome 9 (TF investigation and prosecution)

4.2.1. Prosecution/conviction of types of TF activity consistent with the country’s risk-profile

84.  

4.2.2. TF identification and investigation

85.  

4.2.3. TF investigation integrated with –and supportive of- national strategies

86.  

4.2.4. Effectiveness, proportionality and dissuasiveness of sanctions

87.  

4.2.5. Alternative measures used where TF conviction is not possible (e.g. disruption)

88.  

Overall conclusions on IO.9

89. [Weighting and conclusion: See IO.1 for instructions]
90. [Evaluated country] is rated as having a [rating] level of effectiveness for IO.9.

4.3. Immediate Outcome 10 (TF preventive measures and financial sanctions)

4.3.1. Implementation of targeted financial sanctions for TF without delay

91.  

4.3.2. Targeted approach, outreach and oversight of at-risk non-profit organisations

92.  

4.3.3. Deprivation of TF assets and instrumentalities

93.  

4.3.4. Consistency of measures with overall TF risk profile

94.  

Overall conclusions on IO.10

95. [Weighting and conclusion: See IO.1 for instructions]
96. [Evaluated country] is rated as having a [rating] level of effectiveness for IO.10.

4.4. Immediate Outcome 11 (PF financial sanctions)

4.4.1. Implementation of targeted financial sanctions related to proliferation financing without delay

97.  

4.4.2. Identification of assets and funds held by designated persons/entities and prohibitions

98.  

4.4.3. FIs, DNFBPs and VASPs’ understanding of and compliance with obligations

99.  

4.4.4. Competent authorities ensuring and monitoring compliance

100.  

Overall conclusion on IO.11

101. [Weighting and conclusion: See IO.1 for instructions]
102. [Evaluated country] is rated as having a [rating] level of effectiveness for IO.11.

The following are templates for tables and case studies for use in this section Chapter. Copy and paste where necessary, or remove.

Table 4.1. <Sample table>

<!!Type the subtitle here. If you do not need a subtitle, please delete this line.!!>

	Note to assessors: please ensure that tables and boxes are numbered per Chapter
<!!Table Row Heading (Alt+W)!!>	<!!Table Cell (Alt+E)!!>

Note: <!!Add the note here. If you do not need a note, please delete this line.!!>
Source: <!!Add the source here. If you do not need a source, please delete this line.!!>

Box 4.1. <Sample Case Study box (enter title here)>

<!!Box heading - If you do not need a box heading, please delete this line.!!>

<!! Do not forget to delete or replace this text.!!>

<!!Box heading 2!!>

Note: <!!Add the note here. If you do not need a note, please delete this line.!!>
Source: <!!Add the source here. If you do not need a source, please delete this line.!!>

5.1. Key Findings and Recommended Actions

Key Findings

1.  
2. Assessors should briefly summarise their conclusions for this chapter, highlighting the most significant findings. Key findings and key recommended actions should be consistent on the substance without a need to strictly mirror each other.

Recommended Actions

1.  
2. Assessors should briefly list the main corrective actions required for the country to improve its level of effectiveness and technical compliance. Assessors should clearly indicate which IO/REC the recommended actions relate to.

103. The relevant Immediate Outcome considered and assessed in this chapter is IO.4104When assessing effectiveness under Immediate Outcome 4, assessors should take into consideration the risk, context and materiality of the country being assessed. Assessors should clearly explain these factors in Chapter One of the mutual evaluation report under the heading of Financial Institutions, DNFBPs and VASPs, as required in the instructions under that heading in the Methodology. . The Recommendations relevant for the assessment of effectiveness under this section are R.9-23, and elements of R.1, 6, 15 and 29.

5.2. Immediate Outcome 4 (Preventive Measures) 105The first paragraph should give a short summary of what relative importance assessors have given to the different types of financial institutions, designated non-financial businesses and professions and VASPs, taking into account the risk, context and materiality of the country being assessed. This should be supplemented by a cross-reference to the more detailed information in Chapter One on how each sector has been weighted (based on risk, context and materiality) (as required in the instructions under that heading in the Methodology).

5.2.1. Understanding of ML/TF risks and AML/CFT obligations

104.  

5.2.2. Application of risk mitigating measures

105.  

5.2.3. Application of CDD and record-keeping requirements

106.  

5.2.4. Application of EDD measures

107.  

5.2.5. Reporting obligations and tipping off

108.  

5.2.6. Internal controls and legal/regulatory requirements impending implementation

109.  

Overall conclusions on IO.4

110. [Weighting and conclusion]
111. [Evaluated country] is rated as having a [rating] level of effectiveness for IO.4.

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6.1. Key Findings and Recommended Actions

Key Findings

1.  
2. Assessors should briefly summarise their conclusions for this chapter, highlighting the most significant findings. Key findings and key recommended actions should be consistent on the substance without a need to strictly mirror each other.

Recommended Actions

1.  
2. Assessors should briefly list the main corrective actions required for the country to improve its level of effectiveness and technical compliance. Assessors should clearly indicate which IO/REC the recommended actions relate to.

112. The relevant Immediate Outcome considered and assessed in this chapter is IO.3106When assessing effectiveness under Immediate Outcome 3, assessors should take into consideration the risk, context and materiality of the country being assessed. Assessors should clearly explain these factors in Chapter One of the mutual evaluation report under the heading of Financial Institutions, DNFBPs and VASPs, as required in the instructions under that heading in the Methodology. . The Recommendations relevant for the assessment of effectiveness under this section are R.14, 15, 26-28, 34, 35 and elements of R.1 and 40.

6.2. Immediate Outcome 3 (Supervision)107The first paragraph should give a short summary of what relative importance assessors have given to the different types of financial institutions, designated non-financial businesses and professions and VASPs, taking into account the risk, context and materiality of the country being assessed. This should be supplemented by a cross-reference to the more detailed information in Chapter One on how each sector has been weighted (based on risk, context and materiality) (as required in the instructions under that heading in the Methodology).

6.2.1. Licensing, registration and controls preventing criminals and associates from entering the market

113.  

6.2.2. Supervisors’ understanding and identification of ML/TF risks

114.  

6.2.3. Risk-based supervision of compliance with AML/CFT requirements

115.  

6.2.4. Remedial actions and effective, proportionate, and dissuasive sanctions

116.  

6.2.5. Impact of supervisory actions on compliance

117.  

6.2.6. Promoting a clear understanding of AML/CFT obligations and ML/TF risks

118.  

Overall conclusion on IO.3

119. [Weighting and conclusion]
120. [Evaluated country] is rated as having a [rating] level of effectiveness for IO.3.

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	Note to assessors: please ensure that tables and boxes are numbered per Chapter
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7.1. Key Findings and Recommended Actions

Key Findings

1.  
2. Assessors should briefly summarise their conclusions for this chapter, highlighting the most significant findings. Key findings and key recommended actions should be consistent on the substance without a need to strictly mirror each other.

Recommended Actions

1.  
2. Assessors should briefly list the main corrective actions required for the country to improve its level of effectiveness and technical compliance. Assessors should clearly indicate which IO/REC the recommended actions relate to.

121. The relevant Immediate Outcome considered and assessed in this chapter is IO.5. The Recommendations relevant for the assessment of effectiveness under this section are R.24-25, and elements of R.1, 10, 37 and 40.108The availability of accurate and up-to-date basic and beneficial ownership information is also assessed by the OECD Global Forum on Transparency and Exchange of Information for Tax Purposes. In some cases, the findings may differ due to differences in the FATF and Global Forum’s respective methodologies, objectives and scope of the standards..

7.2. Immediate Outcome 5 (Legal Persons and Arrangements)

7.2.1. Public availability of information on the creation and types of legal persons and arrangements

122.  

7.2.2. Identification, assessment and understanding of ML/TF risks and vulnerabilities of legal entities

123.  

7.2.3. Mitigating measures to prevent the misuse of legal persons and arrangements

124.  

7.2.4. Timely access to adequate, accurate and current basic and beneficial ownership information on legal persons

125.  

7.2.5. Timely access to adequate, accurate and current basic and beneficial ownership information on legal arrangements

126.  

7.2.6. Effectiveness, proportionality and dissuasiveness of sanctions

127.  

Overall conclusion on IO.5

128. [Weighting and conclusion: See IO.1 for instructions]
129. [Evaluated country] is rated as having a [rating] level of effectiveness for IO.5.

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8.1. Key Findings and Recommended Actions

Key Findings

1.  
2. Assessors should briefly summarise their conclusions for this chapter, highlighting the most significant findings. Key findings and key recommended actions should be consistent on the substance without a need to strictly mirror each other.

Recommended Actions

1.  
2. Assessors should briefly list the main corrective actions required for the country to improve its level of effectiveness and technical compliance. Assessors should clearly indicate which IO/REC the recommended actions relate to.

130. The relevant Immediate Outcome considered and assessed in this chapter is IO.2. The Recommendations relevant for the assessment of effectiveness under this section are R.36-40 and elements of R.9, 15, 24, 25 and 32.

8.2. Immediate Outcome 2 (International Cooperation)

8.2.1. Providing constructive and timely MLA and extradition

131.  

8.2.2. Seeking timely legal assistance to pursue domestic ML, associated predicates and TF cases with transnational elements

132.  

8.2.3. Seeking other forms of international cooperation for AML/CFT purposes

133.  

8.2.4. Providing other forms international cooperation for AML/CFT purposes

134.  

8.2.5. International exchange of basic and beneficial ownership information of legal persons and arrangements

135.  

Overall conclusions on IO.2

136. [Weighting and conclusion: See IO.1 for instructions]
137. [Evaluated country] is rated as having a [rating] level of effectiveness for IO.2.

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1. This section provides detailed analysis of the level of compliance with the FATF 40 Recommendations in their numerical order. It does not include descriptive text on the country situation or risks, and is limited to the analysis of technical criteria for each Recommendation. It should be read in conjunction with the Mutual Evaluation Report.
2. Where both the FATF requirements and national laws or regulations remain the same, this report refers to analysis conducted as part of the previous Mutual Evaluation in [date]. This report is available from [link].

Recommendation 1 – Assessing risks and applying a risk-based approach

For each Recommendation, an opening paragraph should set out the issues on which new analysis is needed, and the issues where earlier analysis will be referred-to. This should include:

• the rating given in the previous MER, where applicable, and the main deficiencies identified;
• any conclusions reached in the follow-up process about whether the country has addressed its deficiencies;
• new FATF requirements, relative to the 2004 methodology; and
• the main changes to the relevant laws, regulations, and other elements in the country.

Criterion 1.1 – (Met / Mostly met / Partly met / Not met)

Each of the criteria should be reviewed, normally in a single paragraph.
If one or more criteria have been considered previously and the relevant laws, enforceable means, or other elements are unchanged, assessors should not repeat the previous analysis. Instead, they should summarise the conclusions, and include a reference to the report where the detailed analysis is set out (including paragraph numbers). Such references should only be made to MERs, FSAPs, or exit-from-follow-up reports which are publicly available; were analysed, considered, and adopted by an assessment body; and if assessors consider the analysis and conclusion were correct.
For each criterion, and prior to the narrative, the assessment team should set out in parenthesis whether the country is meeting FATF requirements. These sub-ratings will ultimately be removed before publication but will guide discussions ahead of and during the Plenary.

Criterion 1.2 – (Met / Mostly met / Partly met / Not met)

Assessors should include only their analysis of whether the criterion is met. General descriptions of the country’s situation, context, or of the legal and institutional framework should be included in the main report, and not in this annex (though assessors may cross-reference any relevant points in the main report).
Assessors have flexibility to devote more space to their analysis where necessary, particularly to complex criteria or criteria which apply to a number of different sectors. In such cases, it may be helpful to set out their analysis in the form of a table. However, assessors should remember that the overall length of this technical annex should normally be limited to a maximum of 60 pages.

Weighting and Conclusion

Assessors should set out their conclusion on the appropriate technical compliance rating, and the reasoning for this. They should be explicit about the importance they attach to each of the criteria (including with reference to the country’s risk and context, as set out in the main MER). The rating should be stated in bold at the end of the paragraph.

Recommendation 2 - National Cooperation and Coordination

Criterion 2.1 – (Met / Mostly met / Partly met / Not met)

Weighting and Conclusion

Recommendation 3 - Money laundering offence

Criterion 3.1 – (Met / Mostly met / Partly met / Not met)

Weighting and Conclusion

Recommendation 4 - Confiscation and provisional measures

Criterion 4.1 – (Met / Mostly met / Partly met / Not met)

Weighting and Conclusion

Recommendation 5 - Terrorist financing offence

Criterion 5.1 – (Met / Mostly met / Partly met / Not met)

Weighting and Conclusion

Recommendation 6 - Targeted financial sanctions related to terrorism and terrorist financing

Criterion 6.1 – (Met / Mostly met / Partly met / Not met)

Weighting and Conclusion

Recommendation 7 – Targeted financial sanctions related to proliferation

Criterion 7.1 – (Met / Mostly met / Partly met / Not met)

Weighting and Conclusion

Recommendation 8 – Non-profit organisations

Criterion 8.1 – (Met / Mostly met / Partly met / Not met)

Weighting and Conclusion

Recommendation 9 – Financial institution secrecy laws

Criterion 9.1 – (Met / Mostly met / Partly met / Not met)

Weighting and Conclusion

Recommendation 10 – Customer due diligence

Criterion 10.1 – (Met / Mostly met / Partly met / Not met)

Weighting and Conclusion

Recommendation 11 – Record-keeping

Criterion 11.1 – (Met / Mostly met / Partly met / Not met)

Weighting and Conclusion

Recommendation 12 – Politically exposed persons

Criterion 12.1 – (Met / Mostly met / Partly met / Not met)

Weighting and Conclusion

Recommendation 13 – Correspondent banking

Criterion 13.1 – (Met / Mostly met / Partly met / Not met)

Weighting and Conclusion

Recommendation 14 – Money or value transfer services

Criterion 14.1 – (Met / Mostly met / Partly met / Not met)

Weighting and Conclusion

Recommendation 15 – New technologies

Criterion 15.1 – (Met / Mostly met / Partly met / Not met)

Weighting and Conclusion

Recommendation 16 – Wire transfers

Criterion 16.1 – (Met / Mostly met / Partly met / Not met)

Weighting and Conclusion

Recommendation 17 – Reliance on third parties

Criterion 17.1 – (Met / Mostly met / Partly met / Not met)

Weighting and Conclusion

Recommendation 18 – Internal controls and foreign branches and subsidiaries

Criterion 18.1 – (Met / Mostly met / Partly met / Not met)

Weighting and Conclusion

Recommendation 19 – Higher-risk countries

Criterion 19.1 – (Met / Mostly met / Partly met / Not met)

Weighting and Conclusion

Recommendation 20 – Reporting of suspicious transaction

Criterion 20.1 – (Met / Mostly met / Partly met / Not met)

Weighting and Conclusion

Recommendation 21 – Tipping-off and confidentiality

Criterion 21.1 – (Met / Mostly met / Partly met / Not met)

Weighting and Conclusion

Recommendation 22 – DNFBPs: Customer due diligence

Criterion 22.1 – (Met / Mostly met / Partly met / Not met)

Weighting and Conclusion

Recommendation 23 – DNFBPs: Other measures

Criterion 23.1 – (Met / Mostly met / Partly met / Not met)

Weighting and Conclusion

Recommendation 24 – Transparency and beneficial ownership of legal persons

Criterion 24.1 – (Met / Mostly met / Partly met / Not met)

Weighting and Conclusion

Recommendation 25 – Transparency and beneficial ownership of legal arrangements

Criterion 25.1 – (Met / Mostly met / Partly met / Not met)

Weighting and Conclusion

Recommendation 26 – Regulation and supervision of financial institutions

Criterion 26.1 – (Met / Mostly met / Partly met / Not met)

Weighting and Conclusion

Recommendation 27 – Powers of supervisors

Criterion 27.1 – (Met / Mostly met / Partly met / Not met)

Weighting and Conclusion

Recommendation 28 – Regulation and supervision of DNFBPs

Criterion 28.1 – (Met / Mostly met / Partly met / Not met)

Weighting and Conclusion

Recommendation 29 - Financial intelligence units

Criterion 29.1 – (Met / Mostly met / Partly met / Not met)

Weighting and Conclusion

Recommendation 30 – Responsibilities of law enforcement and investigative authorities

Criterion 30.1 – (Met / Mostly met / Partly met / Not met)

Weighting and Conclusion

Recommendation 31 - Powers of law enforcement and investigative authorities

Criterion 31.1 – (Met / Mostly met / Partly met / Not met)

Weighting and Conclusion

Recommendation 32 – Cash Couriers

Criterion 32.1 – (Met / Mostly met / Partly met / Not met)

Weighting and Conclusion

Recommendation 33 – Statistics

Criterion 33.1 – (Met / Mostly met / Partly met / Not met)

Weighting and Conclusion

Recommendation 34 – Guidance and feedback

Criterion 34.1 – (Met / Mostly met / Partly met / Not met)

Weighting and Conclusion

Recommendation 35 – Sanctions

Criterion 35.1 – (Met / Mostly met / Partly met / Not met)

Weighting and Conclusion

Recommendation 36 – International instruments

Criterion 36.1 – (Met / Mostly met / Partly met / Not met)

Weighting and Conclusion

Recommendation 37 - Mutual legal assistance

Criterion 37.1 – (Met / Mostly met / Partly met / Not met)

Weighting and Conclusion

Recommendation 38 – Mutual legal assistance: freezing and confiscation

Criterion 38.1 – (Met / Mostly met / Partly met / Not met)

Weighting and Conclusion

Recommendation 39 – Extradition

Criterion 39.1 – (Met / Mostly met / Partly met / Not met)

Weighting and Conclusion

Recommendation 40 – Other forms of international cooperation

Criterion 40.1 – (Met / Mostly met / Partly met / Not met)

Weighting and Conclusion

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SUMMARY OF TECHNICAL COMPLIANCE – KEY DEFICIENCIES

Annex Table 2. Compliance with FATF Recommendations

Recommendations	Rating	Factor(s) underlying the rating
1. Assessing risks & applying a risk-based approach	[C]	This table should set out the rating, and a summary of all the factors contributing to each rating.
2. National cooperation and coordination	[LC]	•
3. Money laundering offences	[PC]	•
4. Confiscation and provisional measures	[NC]	•
5. Terrorist financing offence		•
6. Targeted financial sanctions related to terrorism & TF		•
7. Targeted financial sanctions related to proliferation		•
8. Non-profit organisations		•
9. Financial institution secrecy laws		•
10. Customer due diligence		•
11. Record keeping		•
12. Politically exposed persons		•
13. Correspondent banking		•
14. Money or value transfer services		•
15. New technologies		•
16. Wire transfers		•
17. Reliance on third parties		•
18. Internal controls and foreign branches and subsidiaries		•
19. Higher-risk countries		•
20. Reporting of suspicious transaction		•
21. Tipping-off and confidentiality		•
22. DNFBPs: Customer due diligence		•
23. DNFBPs: Other measures		•
24. Transparency and beneficial ownership of legal persons		•
25. Transparency and beneficial ownership of legal arrangements		•
26. Regulation and supervision of financial institutions		•
27. Powers of supervisors		•
28. Regulation and supervision of DNFBPs		•
29. Financial intelligence units		•
30. Responsibilities of law enforcement and investigative authorities		•
31. Powers of law enforcement and investigative authorities		•
32. Cash couriers		•
33. Statistics		•
34. Guidance and feedback		•
35. Sanctions		•
36. International instruments		•
37. Mutual legal assistance		•
38. Mutual legal assistance: freezing and confiscation		•
39. Extradition		•
40. Other forms of international cooperation		•

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GLOSSARY OF ACRONYMS109Acronyms already defined in the FATF 40 Recommendations are not included into this Glossary.

	DEFINITION
AML/CFT	Anti-Money Laundering and Combating the Financing of Terrorism

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