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FATF sanctions

The Financial Action Task Force (FATF) is an inter-governmental body whose purpose is the development and promotion of national and international policies to combat money laundering and terrorist financing. As member of the FATF, Switzerland participates in the implementation of the FATF measures.

In connection with its initiative " Non-cooperative countries and territories (NCCTs)", the FATF has researched the weaknesses of the anti-money laundering systems of countries and territories with international financial centres, and particularly the financial offshore centres, by using 25 criteria. This permitted the FATF to identify countries and territories, the regulations and practices of which significantly infringed the fight against money laundering and the relevant international co-operation. The FATF then requested of the identified countries and territories that they adapt their systems to internationally recognised standards. The FATF then established a list of countries and territories with important flaws in their anti-money laundering instruments or a lack of willingness to cooperate in combating money laundering. Published for the first time in June 2000, the NCCT list is updated periodically by the FATF plenary meetings. All countries and territories that were previously listed have improved their systems and have been removed from the list.

According to the FATF Recommendation 21, financial intermediaries must pay particular attention to business relationships and transactions with natural and legal persons from countries and territories recorded in the NCCT list. In such cases, enhanced due diligence measures must be taken:

Business relationships and transactions partially or fully executed through countries and territories of the NCCT list, or implicating natural or legal persons of such countries, are subject to the special obligation to clarify as per Article 6 MLA.

The Money Laundering Control Authority emphasises that financial intermediaries are therefore obliged to themselves seek informatin periodically on modifications made to the NCCT list, particularly following the trimestrial plenary meetings of the FATF in February, June and October. Furthermore, they must fulfil their obligation of enhanced due diligence when undertaking relations with natural and legal persons from one of the listed countries.

In compliance with an FATF statement of 28 February 2008 all business relationships in connection with Uzbekistan, Iran, Pakistan, São Tomé & Príncipe, Turkmenistan and the northern part of Cyprus are subject to the special duty of clarification according to article 6 MLA.