Glass quarter full? The state of global anti-money laundering in four charts

Glass quarter full? The state of global anti-money laundering in four charts

Out of the hundreds of commitments governments have made to fight corruption and money laundering, one of the easiest to keep track of is the promise to implement the global anti-money laundering standards – the FATF recommendations.

The Financial Action Task Force (FATF) is the world’s leading anti-money laundering organisation; since 1990 over 180 countries have signed up to implement its package of 40 recommendations, a commitment repeatedly reaffirmed at international meetings.

In 2016, for example, G20 leaders called for the “swift, effective and universal implementation of the FATF standards”, while in May 2017 the finance ministers of the G7 said, “We reiterate our commitment to fully and effectively implement the FATF standards, including on designated non-financial businesses and professions.”

Because the FATF regularly assesses and rates its member countries, and publishes the results, it is possible to check how well countries are doing against these commitments.

The charts below take the most recently available FATF ratings to assess countries’ efforts to tackle dirty money, as a first introduction. Anti-money laundering is a highly complex and quickly evolving field, and it is important to also recognise there are methodological caveats as well as serious civil society concerns with the FATF process. 


Despite some progress, there’s a long way to go before national anti-money laundering laws meet the global standard.

As of April 2017, the level of country compliance with the FATF 40 recommendations rests at just 25 per cent across the 30 countries most recently assessed. While this is definitely an improvement since 2011, when full compliance across 160 countries was at 12.3 per cent, taking 27 years since the standards were introduced to get to a 25 per cent compliance level cannot exactly be called rapid progress.  

The few areas in which there is high compliance across countries include basic measures such as making money-laundering a criminal offence (Recommendation 3 – 87 per cent of 30 countries rated compliant or largely compliant), and requiring financial institutions to report suspicious transactions to the authorities (Recommendation 20 – 83 per cent of countries rated compliant or largely compliant).

On the other hand, areas where the majority of countries are rated “partially compliant” or “non-compliant” include requiring firms to carry out due diligence in non-financial fields such as real estate, law and accounting (Recommendation 22 – 63 per cent of countries rated either partially or non-compliant) and making sure the authorities can identify the real owners of corporations to avoid the abuse of anonymous shell companies (Recommendation 24 – 73 per cent of 30 countries rated partially or non-compliant).  

Note: 2011 based on ratings across all Recommendations for 161 countries as reported by the IMF; 2017 based on ratings for all Recommendations across 30 countries as reported by FATF.

There’s a serious implementation gap: laws are not being applied effectively.

The major methodological innovation FATF introduced in 2013 is that it now also rates its member countries according to the practical effectiveness of their systems to stop dirty money. What the effectiveness ratings for the first 30 countries assessed using this new method show is a significant implementation gap: even where laws are in place, they are not being used.

For example, despite supervisory authorities in the majority of countries having the powers they need to carry out their duties in law (Recommendation 27 – 83 per cent either fully or largely compliant), no country was found to be effective in using these powers, with 86.7 per cent of countries rated as having moderate or low effectiveness in their supervision (effectiveness Immediate Outcome 3). 

No country is doing enough to stop anonymous shell company abuse.

Anonymous shell companies are the weakest link in the global financial system. Cheap and easy to set up, they allow individuals to disguise their ownership of bank accounts, real estate and luxury assets. As the Panama Papers (among many other scandals) have proved, anonymous shell companies are used by everyone from corrupt public officials and tax evaders to mobsters and terrorists. 

In addition to the legislative weaknesses already noted, not a single one of the 30 countries FATF has assessed since 2014 is rated as highly effective in practice when it comes to preventing the abuse of anonymous company ownership (what FATF calls Immediate Outcome 5). Almost 9 out of 10 countries (86.7 per cent) are rated as having either moderate or low effectiveness in this area.  

What next?

Awareness of the consequences of corruption, money laundering and tax abuses in terms of human rights, development and inequality has never been higher. However, national legislative and enforcement progress against dirty money is all too often driven by crises and scandals (or an upcoming FATF visit) rather than by proactive strategies. Reports by FATF and other sources including Transparency International tell a repeated story of under-resourced government agencies, weak laws, ineffective sanctions and limited cooperation across borders.

Government authorities sometimes like to say they will redouble their efforts to tackle illicit flows. In the case of anti-money laundering, this should be taken literally: at least double the resources and energy will be required to make a real difference.

The private sector also has a role to play. Too often, the task of stopping dirty money is seen as a compliance cost to be minimised. Taking anti-money laundering seriously means accepting that investment in effective prevention systems will be an unavoidable requirement in coming years, and also makes good business sense in the long run. In general, anti-money laundering experts have noted that the entire system is overly geared towards compliance with rules by both governments and businesses, instead of towards a set of clearly defined objectives. 

It remains to be seen if by the year 2021, when FATF completes its ongoing round of assessments, countries have improved both their legal frameworks and practical effectiveness. For now, the glass is at best a quarter full.  

Image: Creative Commons/Flickr/

For any press enquiries please contact


Support Transparency International

#18IACC: Call for workshop proposals now open!

The 18th edition of the International Anti-Corruption Conference to take place in Copenhagen from 22-24 October 2018 is thrilled to announce that the call for workshop proposals is now open. Help us shape the #18IACC agenda! Anyone interested in the fight against corruption is welcome to submit a proposal.

The impact of land corruption on women: insights from Africa

As part of International Women’s Day, Transparency International is launching the Women, Land and Corruption resource book. This is a collection of unique articles and research findings that describe and analyse the prevalence of land corruption in Africa – and its disproportionate effect on women – presented together with innovative responses from organisations across the continent.

Passport dealers of Europe: navigating the Golden Visa market

Coast or mountains? Real estate or business investment? Want your money back in five years? If you're rich, there are an array of options for European ‘Golden Visas’ at your fingertips, each granting EU residence or citizenship rights.

How the G20 can make state-owned enterprises champions of integrity

For the first time in its presidency of the G20, Argentina is hosting country representatives from across the globe to address the best ways of curtailing corruption and promoting integrity in state-owned enterprises (SOEs).

Europe and Central Asia: More civil engagement needed (Part II)

As follow-up to the regional analysis of Eastern Europe and Central Asia, additional examples from Albania, Kosovo and Georgia highlight the need for more progress in anti-corruption efforts in these countries and across the region.

Lutte contre la corruption en Afrique: Du bon et du moins bon

La publication de la dernière édition de l’Indice de perception de la corruption (IPC) offre un bon point de repère pour situer les efforts de lutte contre la corruption que l’Union africaine (UA) poursuivra tout au long de 2018

No hay cambios en las percepciones pese a los avances en América

En los últimos años, América Latina y el Caribe lograron adelantos significativos en la lucha contra la corrupción. En muchos países de la región existen ahora leyes y mecanismos para contrarrestar este fenómeno, las investigaciones legales están avanzando y los movimientos ciudadanos anticorrupción han incrementado. Sin embargo, de acuerdo con el Índice de Percepción de la Corrupción (IPC) 2017, la región continúa con bajos puntajes.

A redefining moment for Africa

The newly released Corruption Perceptions Index (CPI) provides a good baseline for the African Union (AU) anti-corruption efforts in 2018. This year’s theme for the AU is “Winning the Fight against Corruption: A Sustainable Path to Africa’s Transformation.” As the AU rolls out its plan, this is an important moment for Africa to take stock of the current situation.

Social Media

Follow us on Social Media

Would you like to know more?

Sign up to stay informed about corruption news and our work around the world