As the world remains affected by lockdowns in the ongoing COVID-19 crisis, financial criminals are engaging in frauds and scams. The Financial Action Task Force (FATF) has noted that criminals are trafficking in counterfeit medicines, offering fraudulent investment opportunities, and engaging in phishing schemes.
The FATF advises strict vigilance and the use of digital financial services in these times when social distancing is the norm. With restrictions on physical transactions right now, the FATF is encouraging technologies, including Fintech, Regtech and Suptech, to eliminate risks. Stakeholders must also adhere to the FATF guidelines on the secure use of a digital ID.
Governments all over the world must ensure that legitimate non-profit organizations (NPOs) are able to carry out their noble deeds. The FATF Standards provide flexibility in this regard. Most NPOs are low-risk, so governments must employ risk-based approaches to determine the legitimacy of operations.
Where the risks of money-laundering are lower, the FATF Standards also allow for simplified due diligence measures. Further, financial intelligence units and law enforcement agencies must share information with the private sector to address COVID-19-related money-laundering risks. In the end, vigilance and preparedness on the part of financial institutions and other businesses is a must.
Source Name: Moneyval and FATF