The Caribbean Financial Action Task Force (CFATF) is an intergovernmental organization that focuses on combating money laundering and terrorist financing in the Caribbean region. It was established in 1992 as a regional affiliate of the Financial Action Task Force (FATF), a global standard-setting body for anti-money laundering and counter-terrorism financing efforts.
CFATF's main objective is to implement and promote measures to prevent and detect money laundering, as well as the financing of terrorism and other related threats to the integrity of the international financial system. The organization works closely with its member countries to develop and enforce robust anti-money laundering and counter-terrorism financing frameworks.
CFATF Members
CFATF's membership consists of various Caribbean countries and territories that actively participate in combating money laundering and terrorist financing. The following is a list of CFATF member countries:
- Antigua and Barbuda
- Aruba
- The Bahamas
- Barbados
- Belize
- Bermuda
- Cayman Islands
- Costa Rica
- Cuba
- Curaçao
- Dominica
- Dominican Republic
- El Salvador
- Grenada
- Guatemala
- Guyana
- Haiti
- Honduras
- Jamaica
- Mexico
- Montserrat
- Nicaragua
- Panama
- Saint Kitts and Nevis
- Saint Lucia
- Saint Vincent and the Grenadines
- Sint Maarten
- Suriname
- Trinidad and Tobago
- Turks and Caicos Islands
- Venezuela
- British Virgin Islands
- United States Virgin Islands
Responsibilities of CFATF
CFATF has several key responsibilities in its mission to combat money laundering, terrorist financing, and related financial crimes in the Caribbean region. Some of the primary responsibilities of CFATF include:
- Setting Standards and Promoting Compliance: CFATF establishes regional AML/CFT standards that align with the international standards set by the FATF. It promotes the adoption and implementation of these standards by its member countries, aiming to ensure a consistent and robust AML/CFT framework across the region.
- Conducting Mutual Evaluations: CFATF conducts comprehensive assessments, known as mutual evaluations, of its member countries to evaluate their compliance with AML/CFT measures. These evaluations assess the effectiveness of countries' legal, regulatory, and institutional frameworks, as well as their implementation of preventive measures and enforcement mechanisms. The evaluations help identify areas of strength and weaknesses, providing recommendations for improvement.
- Providing Technical Assistance and Training: CFATF offers technical assistance and training programs to its member countries. This support helps enhance their capacity to implement effective AML/CFT measures, strengthen their legal and regulatory frameworks, develop skilled personnel, and improve institutional capabilities to combat financial crimes. Technical assistance may include guidance on legislation, risk assessments, investigation techniques, and the establishment of financial intelligence units (FIUs).
- Facilitating Regional Cooperation: CFATF promotes collaboration and information sharing among its member countries, regional organizations, and international partners. It encourages the exchange of best practices, experiences, and expertise in combating financial crimes. CFATF also facilitates cooperation on joint investigations, asset recovery, and extradition processes, strengthening the collective response to transnational financial crimes.
- Conducting Typologies Research: CFATF conducts research and analysis on emerging trends, methods, and typologies of money laundering, terrorist financing, and related financial crimes. This research helps member countries stay updated on evolving risks and adapt their AML/CFT measures accordingly. CFATF shares its findings with member countries and contributes to the global understanding of financial crime patterns and countermeasures.
Local Role of The CFATF
Although The CFATF does not possess AML/CFT standards itself, it pursues the standards listed by FATF in its path for monitoring, supervision, and enforcement. The approach of the CFATF to prevent financial terrorist acts comprise four phases:
- Mutual Evaluations: Member-states of the CFATF evaluate each other's FATF compliance results. These assessments are then published as reports on the CFATF website.
- Follow-Up Reports: Following the evaluation of Mutual Evaluation Reports, member states submit follow-up reports detailing their success in adopting the 40 Recommendations.
- General Meetings: The CFATF conducts plenary meetings at least twice a year in different parts of the Caribbean. Discussions of shortcomings found in Mutual Evaluation Reports and any AML/CFT problems applicable to member-states will take place during the meetings.
- Training and Guidance: The Secretariat of the CFATF offers training and accreditation to member states to properly implement FATF requirements and evaluate the success of their regional financial institutions. The CFATF could also serve as a link between member states and donors looking to provide technical assistance.
CFATF Working Groups
CFATF has several working groups dedicated to addressing specific areas related to its mission of combating money laundering, terrorist financing, and related financial crimes. These working groups bring together experts and representatives from member countries to collaborate on specific issues and develop strategies and recommendations. Some of the CFATF working groups include:
- Technical Compliance Working Group: This working group focuses on technical compliance with the FATF Recommendations and CFATF's own standards. It assesses member countries' compliance levels and provides guidance on strengthening their AML/CFT frameworks. The group also develops and reviews guidance documents, methodologies, and assessment tools to support effective compliance.
- Typologies Working Group: The Typologies Working Group conducts research and analysis on emerging trends, methods, and typologies of money laundering, terrorist financing, and related financial crimes. It identifies new patterns, vulnerabilities, and techniques used by criminals to adopt preventive measures. The group's findings inform policy development, risk assessments, and capacity-building efforts.
- Financial Intelligence Units (FIU) Working Group: This working group focuses on strengthening FIUs, which are responsible for receiving, analyzing, and disseminating financial intelligence related to money laundering and terrorist financing. It promotes cooperation among FIUs in the Caribbean region, facilitates information sharing, and develops best practices and guidelines for effective FIU operations.
- Law Enforcement Working Group: The Law Enforcement Working Group facilitates cooperation and coordination among law enforcement agencies in member countries. It focuses on enhancing investigative techniques, sharing intelligence, and developing joint operational initiatives to combat financial crimes. The group also provides training and capacity-building support to law enforcement officials.
- Legal and Judicial Issues Working Group: This working group addresses legal and judicial challenges in combating financial crimes. It focuses on developing effective legal frameworks, ensuring the adequacy of legislation, and promoting the use of asset forfeiture and confiscation measures. The group also facilitates the sharing of best practices and experiences among member countries' legal and judicial authorities.
- Risk-Based Approach (RBA) Working Group: The RBA Working Group promotes the adoption and implementation of a risk-based approach to AML/CFT measures. It provides guidance on conducting risk assessments, developing risk mitigation strategies, and aligning preventive measures with identified risks. The group emphasizes the importance of understanding and managing risks to effectively combat financial crimes.
The Caribbean Financial Action Task Force (CFATF) plays a pivotal role in safeguarding the integrity of the financial systems in the Caribbean region. Through its dedicated working groups, mutual evaluations, technical assistance programs, and collaborative initiatives, CFATF actively combats money laundering, terrorist financing, and various financial crimes. By promoting compliance with international AML/CFT standards, sharing best practices, and fostering regional cooperation, CFATF contributes to the development of robust legal frameworks, strengthens the capabilities of financial intelligence units, and enhances the overall effectiveness of AML/CFT efforts in member countries. With its unwavering commitment to combatting financial crimes and protecting the integrity of the international financial system, CFATF continues to play a vital role in creating a safer and more transparent Caribbean region.
