RUSI (2024) ¦ A Conversation with Former FATF President Dr Marcus Pleyer

Marcus Pleyer: From a Small AML Team to Shaping Global Financial Crime Policy

Tom Keatinge’s conversation with Dr Marcus Pleyer traces a career that transformed Germany’s anti‑money‑laundering (AML) capacity and placed him at the center of global policy debates as FATF president. The discussion covers Pleyer’s early decisions to prioritise AML, the agenda he pursued at FATF, the role of technology and AI, unintended consequences of AML measures, proliferation financing, the upcoming fifth evaluation cycle, and the European Union’s new Anti‑Money‑Laundering Authority (AMLA). It also outlines Germany’s internal reforms, including plans for a federal financial‑crime agency and why financial crime must be treated as a national security issue.

From tiny unit to national priority

When Pleyer took over a directorate in Germany’s Ministry of Finance about a decade ago, AML work in his area was handled by just two specialists. He judged that AML was underresourced and deprioritised relative to its importance for security and the common good. By convincing political leaders to back a reshaped directorate, he expanded capacity to roughly 130 staff focused on AML, counter‑terrorist financing (CFT), and sanctions. That organizational shift set the stage for deeper national reforms and stronger German engagement at international level.

Why AML matters beyond finance

Pleyer frames AML not merely as technical financial regulation but as an instrument of security: it protects societal fairness, undermines criminal networks, and saves lives. He emphasises AML’s inherently multidisciplinary nature, requiring legal, regulatory, supervisory and investigative skills. That wider framing helped him make the case for sustained political support and investment.

Objectives as FATF president

Pleyer entered the FATF leadership asking two core questions: how to fix observable gaps in the system, and how the organisation could help address major global problems such as environmental crime, illegal migration and arms trafficking. From those questions he set two priorities: technology and information‑sharing; and bringing attention to flows of illicit funds tied to global challenges. He pushed FATF to be more forward‑looking and outcome‑focused.

Bastian Schwind-Wagner_Follow "Dr Marcus Pleyer’s account highlights how prioritising risk‑based supervision and embracing technology can transform AML efforts from fragmented compliance exercises into effective tools for national security and the public good. His work at the FATF and in Germany underscores the need for coordinated institutions, political commitment, and modern analytics to follow the money and disrupt criminal networks."

Technology, AI and effectiveness

Pleyer argues that technological tools and artificial intelligence are now indispensable for effective AML work. When he first discussed AI with banks (2018–2019), they reported insufficient data and immature models. That has changed rapidly: AI can assemble fragmented data points into a coherent picture, improving risk assessment, suspicious activity detection and KYC. In FATF evaluations, effectiveness is the core measure. Pleyer expects the use of technology to become a recurring theme across assessments, not a standalone recommendation, and calls for technology to be treated as a cross‑cutting element of effectiveness.

Unintended consequences and human‑rights limits

One of the major projects initiated during Pleyer’s term looked at unintended consequences of AML measures. He recounts receiving correspondence pointing to humanitarian harms and misuse of AML tools by repressive regimes. That prompted a push to ensure evaluators consider human‑rights implications and the potential for excessive or abusive measures. FATF must balance minimum standards with limits — avoiding situations where overzealous enforcement violates due process or basic rights. Pleyer supports public identification of jurisdictions that over‑comply in damaging ways and sees the work as ongoing under successive FATF leadership.

Proliferation financing and risk assessment

Pleyer explains why FATF strengthened requirements on proliferation financing in Recommendation 1: private sector actors lacked key information to address that risk effectively. Requiring jurisdictions to carry out specific proliferation financing risk assessments fills information gaps and has already driven thematic national work. Those assessments will be evaluated in the coming cycle, which should further raise compliance and awareness.

Shaping evaluation practice: focus on risk and effectiveness

During his presidency FATF reformed mutual evaluation methodology to put greater emphasis on effectiveness rather than formal technical compliance. That change embeds a clearer risk‑based approach and introduces mechanisms to follow jurisdictions even after they pass evaluations. Observed deficiencies will be tracked and could trigger escalation if not remedied, creating stronger incentives for continuous improvement across all jurisdictions, whether systemically important or not.

Supervision: the bridge from law to reality

Pleyer stresses that laws alone do not stop illicit finance; effective, risk‑based supervision does. Moving from a rules‑based to a risk‑based supervisory culture is difficult and slow, but essential. Supervisors must allocate resources to real risks and design incentives that prevent obliged entities from “tick‑box” compliance. Stronger supervision in both public and private sectors is central to making AML frameworks meaningful in practice.

AMLA: a chance for convergence in Europe

Fragmentation across 27 national AML regimes was exposed by major scandals and high‑profile failures. The EU’s AML package and the creation of AMLA respond directly to that fragmentation. AMLA’s mandate combines standard‑setting, supervision and coordination. Its governance model includes a general board of national supervisors and an executive board responsible for direct and indirect supervision. That dual structure is intended to protect decisions from national bias while ensuring cooperation. AMLA’s success will depend on building a new supervisory culture, recruiting diverse expertise, deploying modern technology (including AI), and striking the right balance with national authorities. Pleyer expects AMLA to work on regulatory technical standards immediately and to begin supervision in earnest later in the decade, with supervisory activity starting to show results by 2028.

Germany’s internal reforms: one agency, integrated approach

Germany’s mutual‑evaluation findings highlighted fragmentation in supervision (about 300 different supervisors for non‑financial entities), an excessive focus on predicate offences rather than “follow the money”, and systemic deprioritisation of money‑laundering work within agencies juggling many competing tasks. In response, Germany plans a federal financial‑crime agency that consolidates FIU functions, supervision and a specialised criminal investigation unit under one roof. The agency’s single mandate — fighting financial crime — is designed to prevent deprioritisation and to embed a follow‑the‑money investigative approach. Pleyer used national risk assessments and the FATF mutual evaluation to persuade ministers and parliamentarians that reform and investment were necessary.

Financial crime as a national‑security issue

Pleyer argues that financial crime should be viewed through a national‑security lens. Illicit finance can fund terrorist groups, support hostile state activity, and concentrate economic power that distorts politics and society. In Germany, the fight against financial crime is now explicitly part of the national security strategy, and the government plans to host a “No Money for Terror” conference aligned with the Munich Security Conference to emphasise these linkages.

Looking ahead

Several practical signs of future progress emerged from the conversation. FATF will continue refining evaluations with stronger effectiveness and risk indicators, FATF’s work on unintended consequences and human‑rights safeguards will develop further, proliferation financing assessments will become routine, and AMLA will begin its operational build‑out in Frankfurt with supervisory work ramping up through the late 2020s. Germany’s federal financial‑crime agency is an example of structural reform intended to close coordination gaps and focus national efforts on follow‑the‑money investigations.

Conclusion

Marcus Pleyer’s career shows the impact of converting technical regulatory priorities into strategic, security‑focused policy. His FATF presidency emphasised technology, risk‑based evaluations, and awareness of unintended consequences. The EU’s AMLA and Germany’s federal financial‑crime agency are practical responses to gaps he identified: fragmentation, insufficient supervision, and weak follow‑the‑money capabilities. The conversation underlines a central message: law without effective, risk‑based supervision and modern technology will not stop organised crime or protect national security; institutional design, political will and operational capacity must align to make AML systems work.