Korea, a New Member of FATF
2010/01/28 17 Comments
In order to effectively deal with Money-Laundering, the FATF was established attendant upon the consensus at G7 Summit in 1989. Furthermore, the consolidated role of the FATF was required to strengthen the transparency of global financial market and cut down on the risk of Money Laundering at the last G20 Summit. That is to say, international society agreed on sorting out and seeking the sanction against Non-Cooperative Jurisdiction, who does not implement the global standard regarding Terrorist-Financing and distract the transparency of the financial market.
The FATF consists of 35 countries (33 countries and 2 international organizations) with OECD (Organization for Economic Cooperation and Development) members as the core. However, among 30 OECD members, 4 countries including Poland, Hungary, the Czech Republic, and Slovakia are not joining into the FATF. Nevertheless, as we can see, the FATF includes most of the countries around the globe which promise to actively support and participate in the global efforts on AML. To be brief, it reflects the international society recognizes the significance of the role of Anti-Money Laundering.
the FATF carries out the 3 main roles. The first is Anti-Money Laundering and the creation of the blocking global network. The second is the study on the method of Money Laundering and development of its countermeasure. At last, there is the enactment and legislation of the related international regulations and institution.
Korea joining the FATF, Why is it significant?
Korea has been admitted as a full member into the FATF(Financial Action Task Fore) during the FATF plenary meeting in Paris from October 14 to 16,2009. This has several significant implications. Above all, there is the increasing necessity of Anti-Money Laundering system. The four major reasons for Korea in joining the FATF are (1) The improvement of the credibility of financial institution, (2) The efficient regulation against a criminal act, (3) The prevention of side effect triggered by liberalization measure of foreign exchange, (4) The affirmative participation to the global effort for counter-terrorist financing. It will also bring positive aftermath to the improvement of overseas credibility and the global authorization acquisition concerning domestic factors including institution. It will not merely contribute to the enlargement of the role of Korea within the FATF as the chair country of the next G20 summit on November, 2010, but strengthen the global representative status within Asia. Due to the fact that the issue of money laundering or terrorist financing was one of the main agenda of the last G20 summit. Korea needs to actively participate in not merely Asia-Pacific related activities, but the broader global efforts as the chair of the next G20 summit in 2010 as mentioned previously. Furthermore, Korea is required to enlarge the participation in the FATF working group. Eventually, the diverse efforts and its role for AML/counter-terrorist financing should not be restricted within the scope of counter-terrorism and crime.