The APG conducts peer review assessments of the Anti-Money Laundering (AML) Counter Terrorism Financing (CFT), and Counter Proliferation Financing (CPF) systems of its members, known as Mutual Evaluations (MEs). MEs assess a member’s compliance with, and effective implementation of, the international standards (the FATF Recommendations) for combating money laundering, terrorism financing and proliferation financing.
There are follow-up processes associated with mutual evaluations. These follow-up processes monitor members’ progress with addressing the deficiencies identified in a Mutual Evaluation Report (MER).
The APG conducts mutual evaluations in rounds. A round is where all members undergo an assessment (ME and follow-up) using the same methodology.
The Global 5th Round of Mutual Evaluations commenced in 2024, with the FATF, the APG and other FATF-Style Regional Bodies (FSRBs) using the FATF Recommendations and 2022 Methodology to assess all members. The APG commences its first APG-only MEs in 2026.
Some APG members are also FATF members. The APG’s joint APG/FATF members have their mutual evaluations and follow-up conducted under the FATF’s processes with the APG adopting relevant reports. APG-only members have their mutual evaluations conducted under the APG’s Global Fifth Round ME Procedures.
Assessment of APG members’ AML/CFT/CPF regime (Mutual Evaluation)
APG mutual evaluations, like FATF mutual evaluations, are reports analysing the implementation and effectiveness of measures to combat money laundering, terrorism financing and proliferation financing. The reports are peer reviews, where experts are drawn from APG members and/or observers to form a multi-jurisdiction team to assess a particular APG member. The mutual evaluation reports provide an in-depth description and analysis of a member’s AML/CFT/CPF systems. The reports identify deficiencies against the FATF global standards and provide recommendations for strengthening these systems.
The mutual evaluation includes two components:
- Technical Compliance: A “desk-based” technical compliance analysis assessing a member’s compliance with the specific requirements of each of the 40 FATF Recommendations - the relevant legal and institutional framework of the jurisdiction, and the powers and procedures of competent authorities. These recommendations represent the building blocks of an AML/CFT/CPF system.
- Effectiveness Analysis: An effectiveness analysis assesses the extent to which an APG member achieves a defined set of outcomes that are central to a proper functioning and effective AML/CFT/CPF system with expected results based on the money laundering (ML) terrorism financing (TF) risk profile of that jurisdiction. The assessment team will look at 11 key areas, or Immediate Outcomes set out in the FATF Methodology, to determine the level of effectiveness of a jurisdiction's efforts.