The Global South Dialogue on Economic Crime ((GSDEC) has released a new report analysing how countries have adhered to Financial Action Task Force’s (FATF) standards.
The 83-page report titled, “An Analysis of Compliance and Effectiveness Status of Assessed Countries under the 4th Round and its FRSB Equivalent” was published on Economic GSDEC ‘s website.
The report evaluated countries’ technical compliance and effectiveness based on the FATF’s 4th Round of evaluations.
It further explores factors that determine compliance outcomes of countries, including the influence of factors such as the FATF methodology, the composition of assessment experts and language.
Studying 99 countries, the report authored by renowned academics, Dr Nkechikwu Azinge-Egbiri and Dr Kolawole Ebire, examined best and worst complied countries while giving a breakdown performance of West Africa countries in its analysis.
Findings from the report revealed that countries that conduct robust risk assessments have a deeper understanding of their risks and comply strongly with the FATF standards.
It further contended that the much-improved FATF methodology comes with its challenges, given that its applicability has unintended consequences for developing countries.
Commenting on the report, Assistant Professor at University of Warwick and Founding member of GSDEC, Dr Joy Malala said, “The report is timely and demonstrates the challenges Global South countries face with transplantation. For instance, 2020 was a turning point for digital financial services across the globe as a result of the Covid-19 pandemic, yet it brought on challenges. The resulting FATF digital identities directive ushered to address the challenges associated with digital financial services is one developing country will struggle with due to the likely unintended consequences such as its exclusionary nature.
“Yet, I believe the FATF’s directive can be effectively adapted to the cybercrime landscape of these countries if carefully assessed. The impact of the digital identification roll out on vulnerable population segments needs to be explored on regional basis in order to maintain, secure and inclusive provision of financial services.”
