The Financial Action Task Force (FATF) is conducting a targeted review of jurisdictions with significant crypto activity to address gaps in anti-money laundering (AML) compliance. The intergovernmental watchdog announced the review on Friday, focusing on regions with materially important virtual asset service provider (VASP) activity. The FATF will consider existing assessment statuses but did not disclose which jurisdictions are under review or how many will be included.
Initial findings from the review are expected in June 2027, with further results due in October 2027. The process will include monitoring and faster reporting to track progress in addressing deficiencies. The FATF emphasized that its regular assessments and follow-up procedures will remain the primary tools for evaluating compliance.
The move follows a July FATF report revealing that 83% of surveyed jurisdictions had adopted crypto Travel Rule legislation, yet significant enforcement gaps persisted. The report found that 55 of the 91 jurisdictions with Travel Rule laws had not taken supervisory or enforcement action over compliance. Authorities also struggled to identify unlicensed crypto businesses and oversee providers serving local customers from overseas.
The Travel Rule requires crypto service providers to share information about the sender and recipient of transfers. The FATF's latest initiative aims to strengthen global AML standards in the crypto sector, addressing persistent challenges in enforcement and oversight.