AML/CFT Regime
Amid growing concerns about frequent money laundering and terrorist financing activities using cross-border financial transactions, the international community has found it increasingly necessary to facilitate global cooperation in fighting such activities. Korea is actively participating in international collaboration in the AML/CFT field.
The Financial Action Task Force on Money Laundering (FATF) is an inter-governmental body whose purpose is the development and promotion of policies, both at national and international levels, to combat money laundering and terrorist financing. The FATF currently comprises of 39 member jurisdictions and 2 regional organizations (EC, GCC).
After the establishment of the KoFIU in 2001, Korea vigorously sought full membership at the FATF. Korea obtained the FATF observer status in August 2006 and completed the mutual evaluation, an essential process to become a member of the FATF, in November 2008. The Mutual Evaluation Report was adopted at the FATF Plenary in June 2009 and Korea gained full membership in October 2009.
As the FATF is the only "standard-setter" in the field of AML/CFT, Korea's full membership at the FATF allows Korea to more actively participate in the process of establishing and revising the international standards instead of simply implementing the standards set by the international community. The FATF membership bestows the official recognition over a country's AML/CFT system. Korea's membership in the FATF will help enhance the international credibility of the Korean financial system, and consequently grant favor towards Korean financial institutions' overseas operations.
In October 2009, the Korean government established an action plan to further improve the AML/CFT regime in line with the FATF standards. The plan sets out detailed measures to be taken in the short, medium and long-term. The focus of the plan is to address the deficiencies in the Korean AML/CFT regime identified in the FATF Mutual Evaluation Report, which was adopted in June 2009. It includes firm and decisive measures that require legislative actions. The Korean government is now faithfully taking measures to improve the AML/CFT regime in accordance with this action plan.
The Asia/Pacific Group on Money Laundering (APG) is a FATF-style regional body comprising 41 member jurisdictions in the Asia-Pacific region.
Korea has been an active member of the APG since its admission back in 1998. Korea took the APG Co-Chair position from 2003 to 2004 and hosted the 7th APG Annual Meeting in 2004 in Seoul. The Annual Meeting was held for five days from June 14 to 18, 2004 and was attended by 210 representatives from 28 member jurisdictions, 9 observer jurisdictions and 13 international organizations. Korea is currently a member of the steering group and the Donors and Providers (DAP) Group.
The Egmont Group of Financial Intelligence Units (the Egmont Group) was established in 1995, and has grown to a membership of 139 financial intelligence units. Its purpose is to identify methods to promote the development of FIUs and to cooperate in the areas of information exchange, training, and sharing of expertise among its members in the interest of combating money laundering and terrorism financing.
The KoFIU joined the Egmont Group in 2002 and has been actively participating in its activities. In 2008, the KoFIU hosted the 16th Egmont Group Plenary and Working Group Meetings in Seoul for five days from May 25 to 29. It marked the first Egmont plenary held in Asia and the first one since the Egmont Group was launched as an official international organization in 2007. About 250 representatives from 90 FIUs around the world and 12 international organizations, including the World Bank and the United Nations Office on Drugs and Crime, attended the 2008 Egmont Group Plenary and discussed methods to reinforce international AML/CFT cooperation among FIUs across the world