FATF View on NPO Abuse – the Best Practices Paper

The FATF plenary meeting in Brisbane (24-26 June 2015) approved this revised Best Practices Paper. Read more here and here about the influence and input of NPOs on the revised paper, and some of its key elements.

The FATF claims that:

  • fundraising for charities has been used to provide cover for the financing of terrorism
  • often, the non profit organisation (NPO) itself was a shell, existing simply to funnel money to terrorists
  • some NPOs have provided cover and logistical support for the movement of terrorists and illicit arms.

The FATF first issued a Best Practices paper for the sector in October 2002, which was updated in June 2013, incorporating suggestions provided by a civil society working group.  It  claimed to set out measures to protect NPOs from misuse while at the same time not disrupting or discouraging legitimate charitable activities.

Measures included:

  • outreach to the NPO sector concerning terrorist financing issues
  • supervision or monitoring of the NPO sector
  • effective information gathering and investigation, and
  • effective capacity to respond to international requests for information about an NPO of concern

NPOs have sought a further revision of the Best Practices paper, including a revision of Recommendation 8 itself. This was submitted to the FATF in December 2014 in the form of an Initial NPO Input into FATF Revision of the R8 Best Practices Paper, developed by participants at a meeting in Paris in October 2014, with relevant input from the wider NPO working group. The paper was revised and approved at the FATF plenary in June 2015. The new Best Practices Paper is here.