The Ministry of Finance of Ukraine highly welcomes the Financial Action Task Force (FATF) June Plenary decision to suspend the rights of russia as a member of the FATF and limit its participation in the organisation. In particular, russia can no longer hold any leadership or advisory roles or take part in decision-making on standard-setting, FATF peer review processes, governance and membership matters. The russian federation can also no longer provide assessors, reviewers or other experts for FATF peer-review processes. Such a decision reflects that russia’s unprovoked unlawful aggression against Ukraine clearly contradicts FATF Mandate, principles and commitments.
Ukraine will request further steps from the FATF during the October Plenary in relation to violations of the FATF standards committed by russia, including breaches of specific technical requirements and failure to meet the effectiveness criteria, which were raised by Ukraine.
The Ministry further emphasises significant money laundering, terrorism financing, and proliferation risks emanating from russia in light of its gross violation of the FATF standards and principles. Ukraine will continue to provide its international partners with appropriate information in order to ensure that in the course of subsequent reviews the FATF will address such risks and take further measures to protect the international financial system. The Ministry of Finance calls on other states to provide assistance in this process and support the ultimate exclusion of russia from the FATF and its inclusion on the black list.
The Ministry of Finance further launched relevant consultations with the State Financial Monitoring Service of Ukraine to provide official guidance to the national financial institutions and designated reporting entities on risks related to assets directly or indirectly originating in the russian financial system, as well as the impact of the FATF June Plenary decision on risk assessment policies for such transactions.
The FATF June Plenary decision once again demonstrates that russia has turned itself into a pariah state on the international arena by launching its brutal unprovoked attack on Ukraine. In particular, it has been suspended from the participation in the OECD bodies, excluded from the Council of Europe and MONEYVAL and, now, its actions resulted in the suspension of its activities in the FATF. The latter is yet another risk for all international businesses to consider when assessing the viability of doing business in/with russia.
By its March and April statements, the Financial Action Task Force (FATF) condemned the russian invasion of Ukraine as “a gross violation of the commitment upon which FATF Ministers agree to implement and support the FATF Standards”. To uphold those core values, the FATF during its recent Plenary (14-17 June 2022) undertook to review russia’s role at the FATF and considered further steps.