On 9 July 2024, the Financial Action Task Force (FATF) published a report which provides the latest update on jurisdictions’ compliance with FATF’s Recommendation 15 and its Interpretative Note. In 2019 Recommendation 15 was updated to apply anti-money laundering and counter-terrorist financing (AML/CFT) measures to virtual assets (VAs) and virtual asset service providers (VASPs). The report also updates on emerging risks and market developments relating to the use of VAs for money laundering and terrorist financing.

The key findings in the report include:

  • FATF’s report finds that while some jurisdictions have made progress in putting AML/CFT regulation in place, global implementation is still lagging.
  • Based on 130 FATF mutual evaluation and follow-up reports since the revised Recommendation 15 was adopted in 2019, 75% of jurisdictions are only partially or not compliant with the FATF’s requirements, which is identical to that of April 2023 (75% partially compliant or non-compliant jurisdictions; 73 of 98) and shows negligible improvement.
  • More than a quarter of survey respondents (27%; 39 of 147) have yet to decide if and how to regulate the VASP sector.
  • Jurisdictions have made insufficient progress in implementing the Travel Rule with nearly one third of survey respondents, including some who assessed VA/VASPs as high risk, have not yet passed legislation implementing the Travel Rule.
  • Even among jurisdictions who have passed legislation implementing the Travel Rule, supervision and enforcement remains low. Less than one third (26%; 17 of 65) have issued findings or directives or taken enforcement or other supervisory actions against VASPs focused on Travel Rule compliance.

The FATF will continue to conduct outreach and provide assistance to jurisdictions, particularly those with lower capacity and materially important VASP activity to encourage and support compliance with Recommendation 15. The status of implementation of Recommendation 15 by FATF members and jurisdictions with materially important VASP activity will be updated and published in 2025, as decided by the FATF Plenary in February 2024.