Purpose & Evaluation Approach

The FATF 2022 Assessment Procedures underpin the mutual evaluation process for countries' implementation of Recommendation 16 (R.16), which requires that accurate and meaningful originator and beneficiary information accompany wire transfers. The evaluation of R.16 is conducted through a dual lens: technical compliance and effectiveness. Technical compliance assesses whether appropriate laws and frameworks are in place, while effectiveness focuses on whether the mechanisms are operating to achieve the intended results.

Technical Compliance Assessment for R.16

Under the technical compliance component, assessors examine whether countries have legally binding requirements for financial institutions to:

• Ensure that cross-border and domestic wire transfers contain verified originator and beneficiary information.

• Maintain accurate records of this information.

• Implement risk-based procedures for identifying and acting upon wire transfers lacking required data.

• Comply with the de minimis threshold requirements, where full verification may not be mandatory unless suspicion of ML/TF arises.

These measures must be supported by enforceable regulations and clearly articulated responsibilities for all involved financial intermediaries.

Effectiveness Evaluation of R.16

The effectiveness review considers how well the AML/CFT regime operates in practice. Evaluators look for:

• Evidence that financial institutions are systematically capturing, transmitting, and retaining wire transfer information as required.

• Demonstrated use of originator and beneficiary data in investigations and financial intelligence.

• Whether competent authorities have timely access to relevant data.

• How effectively supervisory bodies oversee and enforce compliance with wire transfer rules.

Assessment teams also rely on feedback from other jurisdictions, case studies, and statistics to assess real-world impact.

Key Evaluation Phases & Documentation

R.16 compliance is assessed as part of a structured mutual evaluation timeline. Countries must submit a comprehensive technical compliance update and effectiveness narrative months in advance of the on-site visit. The evaluation team reviews these inputs and prepares a scoping note, preliminary findings, and eventually a draft Mutual Evaluation Report (MER) that includes ratings and Key Recommended Actions (KRAs) relevant to R.16.

Any identified deficiencies must be addressed through follow-up processes, which may include technical compliance re-ratings (TCRRs) or further scrutiny under the International Co-operation Review Group (ICRG) process if systemic weaknesses are identified.

Conclusion

Within the 2022 Procedures framework, Recommendation 16 serves as a critical control against the misuse of wire transfers for money laundering and terrorist financing. Its evaluation requires a rigorous assessment of both legal obligations and the effectiveness of implementation in real-world scenarios. Countries must not only legislate appropriate controls but also demonstrate practical and risk-based application of these controls across the financial sector.