The Global Financial Action Task Force is changing the way countries are evaluated for money laundering and terrorist financing risks.

The FATF is developing updated risk-based guidance on recommendations related to beneficial ownership and transparency of legal arrangements.

The changes reflect February 2023 revisions to recommendations and complements the existing guidance on legal persons.

A statement from the FATF said: “The guidance aims to help stakeholders from the public and private sectors that are involved in trusts or similar legal arrangements to assess and mitigate money laundering and terrorist financing risks.”

The group agreed to soon release the revised guidance for public consultation and expects to finalise this work at its February 2024 plenary meeting.

Publication of new rules scheduled for November, includes methodology changes recognising updated beneficial ownership and transparency requirements.

The fourth plenary of the FATF concluded last week, as delegates from the FATF’s Global Network (of over 200 jurisdictions) and observers from international organisations participated in discussions at the FATF headquarters in Paris, that ostensibly affect all countries, including Bermuda.

Delegates agreed to release for public consultation the updated FATF risk-based guidance on beneficial ownership and transparency of legal arrangements.

Changes include the FATF’s “strengthened” beneficial ownership and transparency standards.

In preparation for the next round of mutual evaluations in 2025, delegates finalised amendments to the FATF methodology used to assess how effectively countries have implemented FATF’s beneficial ownership and transparency requirements.

The FATF concluded their meetings with a report that stated: “The plenary agreed on amendments to the methodology for the next round of mutual evaluations that sets out how assessment teams will determine the effective implementation of the FATF’s updated beneficial ownership and transparency requirements.

“In March 2022 and February 2023 respectively, the FATF strengthened its beneficial ownership standards.

“The FATF’s mutual evaluation process plays a crucial role in ensuring that countries are taking effective action to close the loopholes and regulatory weaknesses that allow shell companies, or other legal persons and arrangements, to be used as a cover for criminal activity.

“In the next round of mutual evaluations, all countries will be assessed against the FATF’s strengthened beneficial ownership requirements.”