Mutual Evaluations

Mutual Evaluations

In accordance with UFA membership rules, on joining the UFA, members commit to a mutual peer review system to determine the levels of compliance with the international AML/CFT standards. These peer reviews are referred to as “mutual evaluations”.

A mutual evaluation involves a team of experts drawn together from UFA member jurisdictions (specially trained and qualified in the FATF's assessment methodology). The team consists of:

  • legal experts;
  • financial and regulatory experts; and
  • law enforcement experts (including FIU experts).

Training courses for experts are conducted yearly, organised by the UFA secretariat, for delegates within the UFA membership. The FATF also offers courses which UFA delegates may attend.

The UFA is currently in its third round of evaluations having previously conducted two rounds since 1997. The third round commenced in 2014 under the FATF’s revised 2012 standards and 2013 methodology.  The third round includes two components as follows:

Technical Compliance

A desk-based technical compliance analysis assesses compliance by an UFA member 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 system.

The technical compliance analysis is undertaken by an assessment team prior to an on-site visit of the member being evaluated. 

Effectiveness Analysis

An effectiveness analysis assesses the extent to which an UFA member achieves a defined set of outcomes that are central to a proper functioning and effective AML/CFT system with expected results based on the ML and TF risk profile of that jurisdicition.  Experts forming the assessment team use "11 immediate outcomes," including core issues for each outcomes, in the 2013 methodology.

The effectiveness analysis is not just based on information exchanged with the assessment team. After the information is exchanged the team will visit the member under evaluation (usually for two weeks, sometimes longer) and interview government and private sector officials to gain a comprehensive understanding of how the AML/CFT system is working. Private sector participation is central to gaining this understanding.