A major economic evil related to financial sector is the practice of money laundering. Money laundering involves keeping financial assets from illegal activity in a disguised manner. This money is kept without detection of the illegal activity for future use. Through money laundering, the launderer transforms the monetary proceeds derived from criminal activity into funds with an apparently legal source. Now many illegal economic activities and the resultant financial transactions involve different countries. Hence, to make effective counter policies against money laundering, globally coordinated measures are needed. The Financial Action Task Force (FATF) is such a global standard setting body for anti-money laundering and combating the financing of terrorism (AML/CFT). Members in FATF The FATF was formed at the efforts of the OECD, which is a group of the developed countries. At present, the FATF has 34 member countries including India and 2 regional organisations, representing most major financial centres in all parts of the globe. Indonesia and South Africa are two observer countries. The FATF Secretariat supports the Task Force and President. The Secretariat service is provided by the OECD, and the Secretariat is located at the OECD Headquarters in Paris. Formation and objectives The Financial Action Task Force (FATF) is an inter-governmental body established in 1989 at Paris by the Ministers of its Member jurisdictions. It was created with an original purpose of examining and develop measures to combat money laundering. Objectives of the FATF are to set standards and promote effective implementation of legal, regulatory and operational measures for combating money laundering, terrorist financing and other related threats to the integrity of the international financial system. The FATF is therefore a “policy-making body” which works to generate the necessary political will to bring about national legislative and regulatory reforms in these areas. The mandate of the FATF The mandate of the FATF is to counter money laundering and the related crimes. Effective action against money laundering and terrorist financing, including both preventive and law enforcement measures, is essential for securing a more transparent and stable international financial system. Likewise, new threats, such as the financing of proliferation of weapons of mass destruction, can emerge and result in the clandestine use of the international financial system. FATF members have revised its mandate in 2012 The Financial Action Task Force (FATF) exists for the purpose of protecting the international financial system from misuse and to mobilise action to go after criminals and their assets. Objectives of the FATF in developing policy and promoting effective implementation of legal, regulatory and operational measures for combating money laundering, terrorist financing and new and emerging threats to the integrity of the international financial system. The FATF members have adopted revised standards in February 2012. Now these changes are well reflected in the new international standard. The FATF has developed a series of Recommendations that are recognised as the international standard for combating of money laundering and the financing of terrorism and proliferation of weapons of mass destruction. They form the basis for a co-ordinated response to these threats to the integrity of the financial system and help ensure a level playing field. First issued in 1990, the FATF Recommendations were revised in 1996, 2001, 2003 and most recently in 2012 to ensure that they remain up to date and relevant, and they are intended to be of universal application. The FATF monitors the progress of its members in implementing necessary measures, reviews money laundering and terrorist financing techniques and counter-measures, and promotes the adoption and implementation of appropriate measures globally. In collaboration with other international stakeholders, the FATF works to identify national-level vulnerabilities with the aim of protecting the international financial system from misuse. The FATF's decision making body, the FATF Plenary, meets three times per year. India and the Financial Action Task Force (FATF) India became a member of the Financial Action Task Force (FATF) in 2010. The membership of FATF comes nearly four years after the country became an observer in 2006. FATF membership is very important for India in its quest to become a major player in international finance. It will help India to build the capacity to fight terrorism and trace terrorist money and help to successfully investigate and prosecute money laundering and terrorist financing offences. India will benefit in securing a more transparent and stable financial system by ensuring that financial institutions are not vulnerable to infiltration or abuse by organized crime groups. There are many national level efforts to combat money laundering. Financial Intelligence Unit - India (FIU-IND) is the central, national agency responsible for receiving, processing, analyzing and disseminating information relating to suspect financial transactions to enforcement agencies and foreign FIUs. The FATF also works in cooperation with other entities like the Egmont Group. *********