FATF Special Recommendations
and UN Resolutions on the
financing of terrorism
A review of the status of implementation and
legal challenges faced by countries
Jean-Franc¸ois Thony and Cheong-Ann Png
Financial Integrity Group, Legal Department, International Monetary Fund,
Washington, District of Columbia, USA
Abstract
Purpose – This paper seeks to examine the extent to which Financial Action Task Force (FATF)
Special Recommendations and UN Security Council Resolutions on the financing of terrorism have
been implemented by countries and the legal issues relating to the implementation of these
requirements.
Design/methodology/approach – It uses the findings from a review of the International Monetary
Fund and the World Bank, which is based on a sample of 18 countries that were assessed on their
compliance with the FATF 40 þ 9 Recommendations (which include the FATF Special
Recommendations and UN Security Council Resolutions 1267 and 1373) between March 2004 and
August 2005.
Findings – It analyses the extent to which the FATF Special Recommendations and UN Security
Council Resolutions 1267 and 1373 have been implemented, and in particular, the areas which
countries have difficulties in complying fully with the requirements and related issues. It also
discusses the difficulties with applying international law instruments such as UN Security Council
Resolutions 1267 and 1373 where measures were aimed at non-state actors and their assets, as well as
the need for ensuring that persons affected by these measures have adequate legal recourses.
Originality/value – In countering the financing of terrorism, the paper discusses the design of a new
international legal framework, which requires development of new concepts. It suggests that, by
addressing the legal challenges created by these new concepts, the latter can be further refined,
improved and strengthened.
Keywords Financing, Terrorism, Legal decisions
Paper type General review
1. Introduction
Seven years after the adoption by the UN Security Council of the first Resolutions on the
freezing of terrorist assets and the signing in New York of the UN Convention
for the suppression of the financing of terrorism (SFT Convention), and five years after
the adoption by the Financial Action Task Force (FATF) of the Eight Special
Recommendations on terrorist financing (FATF Special Recommendations)[1],
relatively little progress has been made by countries in implementing these instruments.
The current issue and full text archive of this journal is available at
www.emeraldinsight.com/1359-0790.htm
This paper is a revised and updated version of the one presented at the 23rd International
Symposium on Economic Crime at Jesus College, Cambridge, UK on 7 September 2005. This
paper should not be reported as representing the views of the IMF. The views expressed are
those of the authors and do not necessarily reflect the views of the IMF or IMF policy.
JFC
14,2
150
Journal of Financial Crime
Vol. 14 No. 2, 2007
pp. 150-169
q Emerald Group Publishing Limited
1359-0790
DOI 10.1108/13590790710742645