What does countering the financing of terrorism (CFT) mean?
CFT is often read as a synonym for terrorist financing, or for sanctions screening. Terrorist financing is the crime, funding terrorist acts, groups or individual terrorists; CFT is the whole response to that crime, and screening is only one step inside it.
FATF took the subject on in October 2001, after the September 11 attacks. Of today's 40 FATF Recommendations, it calls three "unique to terrorist financing": R.5 on the offense, R.6 on targeted financial sanctions and R.8 on nonprofits.
The R.5 offense reaches funds "whether from a legitimate or illegitimate source" (INR.5), so a CFT control cannot wait for criminal proceeds to appear.
Take a payment firm's customer whom the Security Council designates on a Monday (an illustrative case). EU law carries the listing, the firm freezes the account and reports it, and a prosecutor decides whether a crime was committed. Of those four actors, only the firm is a private business.
CFT, CTF, AML/CFT or CPF: what do the names mean?
A bank's policy may be titled AML/CFT, an Australian lender's AML/CTF and a FATF evaluation AML/CFT/CPF. The first two describe the same terrorist financing controls. The third adds proliferation financing.
Table 1. The names used for the same regime.
| Name | Stands for | Where you meet it | Scope |
|---|---|---|---|
| CFT | Countering, or combating, the financing of terrorism | FATF acronym table, p. 142; FinCEN rule titles | Terrorist financing |
| Counter terrorist financing | The same in plain words; also counter terror financing or anti terrorist financing | FATF's description of its own standard; search queries | Terrorist financing |
| CTF | Counter terrorism financing | Australia's Anti-Money Laundering and Counter-Terrorism Financing Act 2006 | Terrorist financing |
| AML/CFT | Anti money laundering plus CFT | FATF Introduction, p. 7; US programs | Both crimes |
| AML/CFT/CPF | Adds countering proliferation financing | FATF Recommendation 2; the Methodology's title | Adds weapons of mass destruction (R.7) |
CFT and CTF differ only in word order. Proliferation financing joined FATF's mandate in 2008, and its freezes sit in Recommendation 7.
What does CFT add to an AML program?
An AML control asks whether money came from a crime. A CFT control asks where money is going and who receives it, so the trigger is a designation or a terrorist purpose, and the funds may be clean. A grocer's unexplained cash takings raise the first question; honest savings sent to a designated person raise the second (both illustrative).
CFT therefore adds pieces that anti money laundering rules alone lack: screening against terrorist designations with freezes without delay (R.6), protective measures for nonprofits (R.8), and an offense that needs no link to a specific attack (INR.5). Where a group funds itself through crime, the same money is proceeds and terrorist funds at once, so firms run the two under a single AML/CFT program.
Who sets the CFT rules?
Table 2. The CFT rule layers, from the UN to national law (read 2 and 3 November 2026).
| Layer | Instrument and date | What it requires | Who acts |
|---|---|---|---|
| UN treaty | International Convention for the Suppression of the Financing of Terrorism, 9 December 1999, in force 10 April 2002 | Make funding terrorism a crime | 191 state parties |
| UN Security Council | Resolutions 1267 (15 October 1999), 1373 (28 September 2001) and 2462 (28 March 2019) | Freeze designated funds; criminalize funding for any purpose | Council committees designate; states freeze |
| FATF | Recommendations 5 to 8, built on the Special Recommendations of October 2001 | Offense (R.5), freezes (R.6 and R.7), nonprofits (R.8) | Countries, rated by FATF |
| United States, state | Executive Order 13224, 23 September 2001; 31 CFR Part 594 | Block the property of designated terrorists | OFAC |
| United States, firms | Bank Secrecy Act, as amended by USA PATRIOT Act Title III | AML/CFT programs and suspicious activity reports | Banks and other covered firms |
| European Union, state | Directive (EU) 2017/541, 15 March 2017; Common Position 2001/931/CFSP and Regulation (EC) 2580/2001, 27 December 2001; Regulation (EC) 881/2002 | Offense (Article 11); freezes | Member states; the Council lists |
| European Union, firms | Regulation (EU) 2024/1624, from 10 July 2027 | CFT duties of obliged entities | Banks, payment firms and other obliged entities |
| United Kingdom | Terrorism Act 2000; Terrorist Asset-Freezing etc. Act 2010 and SI 2019/577 | Offenses (sections 15 to 18); freezes | Government designates; firms freeze and report |
The treaty and the Council resolutions bind states. FATF turns them into a standard it can test, and each country's law turns that standard into duties of two kinds: the offense and the designations, which the state applies, and the program duties, which firms carry.
In the United States, 18 U.S.C. 2339B makes it a crime to knowingly provide material support or resources to a foreign terrorist organization. OFAC blocks terrorist property under Executive Order 13224, signed 12 days after September 11. Program duties for firms sit in the Bank Secrecy Act. The PATRIOT Act amended it in 2001.
The EU runs two freeze regimes: its own terrorist list under the 2001 Common Position and Regulation 2580/2001, and the UN's Al Qaeda listings, which it carries under Regulation 881/2002. The UK puts offenses and the regulated sector's duty to disclose (section 21A) in the 2000 Act, and freezes in the 2010 Act and the 2019 regulations.
How does FATF judge whether a country's CFT works?
The FATF Methodology, as amended in June 2026, gives each country ratings of two kinds: technical compliance with each of the 40 Recommendations, and effectiveness across 11 immediate outcomes. Three of those outcomes deal with terrorist and proliferation financing alone:
- IO.9 asks whether terrorist financing is investigated and its financiers prosecuted and sanctioned.
- IO.10 asks whether terrorists, their organizations and financiers are kept from raising, moving and using funds, through freezes and nonprofit measures.
- IO.11 asks the same of those who finance weapons of mass destruction.
A regulated firm carries out only the preventive layer of CFT: due diligence, screening and freezing, and reporting. The state owns the offense and designations. Because FATF rates prosecutions (IO.9) apart from freezes (IO.10), a country can score well on one and badly on the other.
What does CFT require of a bank or fintech?
Each duty below traces to a FATF Recommendation; national law sets its exact form for a bank, a payment firm or a fintech.
- A risk assessment that rates terrorist financing. Recommendation 1 has firms assess it next to money laundering risk. In the US, FinCEN's first government wide AML/CFT priorities of 30 June 2021 list foreign and domestic terrorist financing among eight and name ISIS and Al Qaeda as persistent threats.
- Customer due diligence and ongoing monitoring (R.10). A designation or a new purpose can arrive years after onboarding.
- Screening and freezes without delay (R.6). The clock starts at designation. complead, formerly Sanction Scanner, screens each name across 3,500+ sanctions, PEP and watchlists from 220+ jurisdictions, refreshed every 15 minutes; its client screening and ongoing monitoring product keeps screening a name until the firm stops monitoring it.
- Prompt suspicious transaction reports (R.20). The duty reaches funds "related to terrorist financing" as well as criminal proceeds.
- Originator and beneficiary data on payments (R.16). With the names on the message, each institution in the chain can freeze and refuse transactions with designated persons.
- Records kept at least five years (R.11). They must be detailed enough to rebuild individual transactions.
- Nonprofit due diligence for charities and NGOs (R.8). FATF asks for measures that follow the assessed risk "without unduly disrupting or discouraging legitimate NPO activities".
- The same duties outside banks. DNFBPs such as lawyers and casinos carry them (R.22 and R.23), and so do virtual asset service providers (R.15).
Which CFT changes came in 2026?
- 28 January 2026. The UK Sanctions List became the only source of UK designations when OFSI's Consolidated List closed.
- 10 April 2026. FinCEN proposed a new AML/CFT program rule (91 FR 18704). Comments closed on 9 June 2026, and the Federal Register showed no final rule on 3 November 2026.
- June 2026. FATF revised the interpretive note to Recommendation 6 to take in the humanitarian exemption of UN resolutions 2664, 2761 and 2615, and amended its Methodology.
- Next: 10 July 2027. The EU AML Regulation, 2024/1624, starts to apply.
A firm drafting its next risk assessment has to decide whether terrorist financing gets its own line or rides inside money laundering risk. FinCEN's proposal would have US risk assessment processes "review and, as appropriate, incorporate the AML/CFT Priorities", and terrorist financing is one of the eight.
Related terms
- Anti money laundering. The controls against laundering criminal proceeds.
- Terrorist financing. The crime CFT is aimed at.
- Reverse money laundering. Clean money moved toward a criminal end.
- DNFBP. Lawyers, casinos and other businesses outside banking that carry AML/CFT duties (R.22 and R.23).
- USA PATRIOT Act. The 2001 US law that amended the Bank Secrecy Act through Title III.
- Suspicious activity report. What a firm files when it suspects.
How this entry was checked. Each CFT layer above was read in its own source on 2 and 3 November 2026: the UN Treaty Collection status page for the 1999 Convention, Security Council resolutions 1267, 1373 and 2462, the FATF Recommendations as updated in June 2026, the Methodology page and the outcome statements of the 2013 Methodology, Executive Order 13224, 31 CFR Part 594 and 18 U.S.C. 2339B, FinCEN's 2021 priorities and its proposal of 10 April 2026, Directive (EU) 2017/541, Regulations (EC) 2580/2001 and 881/2002 and Regulation (EU) 2024/1624, the Terrorism Act 2000, the 2010 Act and SI 2019/577, and the gov.uk page of the UK Sanctions List. Emirhan Akgün wrote this entry. Ufuk Gürdaş, Compliance Specialist, checked every rule and date against its source. Last reviewed: 6 November 2026.
