The Financial Action Task Force (FATF) Annual Report 2023 – 2024 presents a comprehensive agenda aimed at reshaping the international approach to illicit finance. The message is clear: adapting to evolving threats requires a shift in how institutions manage transparency, data, and digital systems. This shift is particularly relevant for governments strengthening their digital governance frameworks in an increasingly complex financial ecosystem.
Across Africa, the Caribbean, and Southeast Asia, we’ve seen governments increasingly align ongoing digital reforms with FATF priorities – especially in areas such as registry modernization, beneficial ownership frameworks, and the regulation of virtual assets. Notably, the latest FATF standards signal a shift in how ‘effectiveness’ is measured: not by the presence of legislation alone, but by the ability of institutions to produce timely, actionable results that reduce risk and increase transparency.
What Do the Latest FATF Standards Mean for Public Sector Digital Infrastructure?
The report addresses four core areas that are highly relevant for public institutions upgrading their digital infrastructure:
- New guidance expands countries’ ability to act early, including non-conviction-based confiscation and suspension of suspicious transactions. The implication: public registers and identity systems must enable faster access and cross-border cooperation.
- Timely access to reliable information on the real owners of companies and trusts is a cornerstone of the new standards. This requires registries to evolve into structured, interoperable platforms that can serve as single sources of truth.
- A large number of jurisdictions still lack regulatory clarity around virtual assets. Implementation gaps invite risk. Stronger supervision frameworks, combined with traceable data infrastructure, are key enablers of compliant ecosystems.
- FATF’s revision of Recommendation 8 places responsibility on governments to ensure Anti-Money Laundering and Counter Financing of Terrorism (AML/CFT) frameworks do not restrict legitimate non-profit activity. This requires a nuanced, risk-based approach built into regulatory systems.
“The FATF report sets a clear direction: digital governance cannot be treated in isolation from the integrity of the financial system. Countries that embed transparency, data traceability and interoperability into their digital systems will not only meet compliance requirements but also increase trust in public institutions.”
– Gitana Keturkaitė-Dirvonė, AML Expert at NRD Companies
How Can Regions Build the Capacity to Deliver on FATF Priorities?
FATF’s emphasis on its Global Network, comprising FATF-Style Regional Bodies (FSRBs), speaks to the growing importance of peer accountability. The message is subtle but firm: capacity gaps are no longer an excuse. Evaluation cycles are tightening, and institutions must be ready.
- Business registries must move from document repositories to data platforms.
- Inter-agency cooperation must be reinforced through systems, not only memoranda.
- Training must reach the operational level, not stay confined to formalities.
These are areas where lessons from implementation matter most – not as a showcase, but as insight.
“Our experience shows that digital transformation succeeds when institutions see value beyond compliance. Once systems start producing meaningful data that supports investigation, oversight, and policy-making, digitalisation becomes self-sustaining.”
– Gitana Keturkaitė-Dirvonė, AML Expert at NRD Companies
What Does “Effectiveness” Really Mean in FATF’s New Era?
The upcoming round of mutual evaluations will place greater weight on effectiveness, not intent. Digital governance systems must therefore deliver results: proactive disclosure, timely risk detection, and international cooperation capabilities.
The challenge ahead is not only technical. It is about alignment – between laws, institutions, and systems. When countries get this right, compliance becomes a by-product of sound governance, not a standalone effort.
