Once praised as instruments of coercive diplomacy, United Nations Security Council sanctions have become toothless and ineffective. The Security Council is compromised by structural dysfunction that allows states to sabotage and evade its sanctions, thereby hastening the decay of international norms on the proliferation of weapons of mass destruction (WMD).
An antidote, however, may rest with the Financial Action Task Force (FATF), the international organization responsible for setting global anti-money-laundering rules and combatting terrorist financing. By updating its approach to international sanctions implementation, the FATF could play a valuable role in countering the spread of nuclear weapons.
Once praised as instruments of coercive diplomacy, United Nations Security Council sanctions have become toothless and ineffective. The Security Council is compromised by structural dysfunction that allows states to sabotage and evade its sanctions, thereby hastening the decay of international norms on the proliferation of weapons of mass destruction (WMD).
An antidote, however, may rest with the Financial Action Task Force (FATF), the international organization responsible for setting global anti-money-laundering rules and combatting terrorist financing. By updating its approach to international sanctions implementation, the FATF could play a valuable role in countering the spread of nuclear weapons.
In August, France, Germany, and the U.K.—known as the E3—formally initiated the “snapback” mechanism of the Joint Comprehensive Plan of Action, signaling their intent to reinstate U.N. sanctions on Iran, which had been lifted since 2015. According to the E3, Iran had exceeded enriched uranium limits and restricted the International Atomic Energy Agency’s monitoring efforts, in addition to other violations.
The next month, Russian Foreign Minister Sergey Lavrov chided the countries that supported the snapback, claiming that the sanctions were a “deliberate campaign to initiate another phase of strangling Iran economically, financially, and so forth.” Since then, Russia has refused to acknowledge the legality of the snapback sanctions and has committed to furthering its strategic partnership with Iran. A week after the U.N. General Assembly session, a comprehensive cooperation treaty between Moscow and Tehran—which the two countries had signed in January and may ultimately provide Russia with access to Iranian drones to use in Ukraine—went into effect. Given Russia’s refusal to accept the legitimacy of the sanctions, there is no path forward for updates to the plan of action, as any attempt will surely be vetoed by Russia.
Meanwhile, the U.N. sanctions regime on North Korea, which has included a nearly complete financial and economic embargo since 2006, remains in effect after almost two decades—with its most recent significant update almost 10 years ago, in 2017. But as of April 2024, these sanctions lack an oversight body. The Panel of Experts, established by a Security Council resolution in 2009 to report on North Korea’s sanction-evasion activities, previously produced consensus-based biannual reports that helped inform and shape new sanction designations while garnering legitimacy among non-Western countries. This came to an unexpected end, however, when Russia vetoed a usually routine yearly Security Council resolution to renew the Panel of Experts’ mandate.
Perhaps not coincidentally, the Panel of Experts was investigating Russia’s alleged acquisition of arms and troops from North Korea for use against Ukraine at the time of its veto. Then, in June 2024, Moscow and Pyongyang signed a comprehensive partnership treaty, signaling a complete abandonment of Russia’s commitment to North Korean sanctions. (Despite the dismantling of the Panel of Experts, independent reporting by Western countries would verify Russia’s sanctions violations anyway.) With the official monitoring function deliberately cut down by the power of a single veto—and no path forward to achieve a consensus among the permanent members of the Security Council—sanctions on North Korea are doomed to fail.
The longer these regimes rot, the more states and institutions will struggle to identify and keep up with rapidly evolving sanctions-evasion networks, and the more these regimes will contribute to the decay of global nonproliferation commitments.
Barring a structural overhaul of the U.N. system or a string of diplomatic miracles, new strategies must be implemented to fortify ineffective sanctions regimes and fight against WMD proliferation. One type of approach has involved unilateral and small-coalition action. In 2021, for example, the Panel of Experts recommended two North Korean nationals for designation, placing them on a sanctions list for their roles in running overseas labor networks in parts of Western Africa. Although the Security Council failed to act on the panel’s recommendations, the EU promptly designated the two individuals.
“Minilateral” sanctions have also emerged. In October 2024, the U.S., Japan, and South Korea formed the Multilateral Sanctions Monitoring Team, a tripartite alliance designed to coordinate sanctions on North Korea and fill gaps left by the defunct Panel of Experts. The monitoring team’s first report in June 2025—which outlined Russia’s growing ties with North Korea and its apparent violations of its international obligations—was met with mixed reviews. North Korea watchers questioned the report’s failure to secure political support among non-Western countries—a key feature of the U.N. Panel of Experts’ reports—and its lack of “original“ material.
The key problem with these strategies is that they lead to fragmentation and gaps in international implementation, rendering sanctions less effective. The solution lies in a parallel mechanism to the U.N. that can fortify sanctions regimes—and the Financial Action Task Force may be the institution to meet the challenge.
The FATF is a consensus-based intergovernmental organization established in 1989 by the G7 and the European Commission to act as a watchdog and global standard-setting body for financial crime. As of 2025, 40 countries belong to the FATF, and more than 200 countries are committed to implementing its recommendations and standards through subsidiaries known as FATF-style regional bodies. While the organization lacks a legally binding charter—operating instead through recommendations and guidance—it wields substantial power. Countries that end up on its blacklist are largely ostracized from the global financial system, typically resulting in significant losses to foreign direct investment and access to international banking.
The FATF first integrated counterproliferation financing into its mission in 2012. Under FATF Recommendation 7, the organization requires its members to implement targeted financial sanctions “to comply with United Nations Security Council resolutions relating to the prevention, suppression and disruption of proliferation of weapons of mass destruction and its financing.”
As of now, the scope of the FATF’s sanction implementation requirements is too narrow. North Korea, for example, routinely engages in prohibited revenue-generating activities—such as hacking digital currency exchange houses to fund its ballistic missile and nuclear weapons programs—that remain undefined within the FATF counterproliferation financing framework. Additionally, the FATF has a blind spot for the role of intermediary states that are intentionally aiding and abetting proliferation financing. Russia’s alliance with North Korea, for instance, implicates Moscow’s trading partners in indirectly supporting North Korea’s WMD programs, but these partners are not covered in the FATF’s recommendations.
For things to change, the FATF must embrace a full-fledged commitment to counterproliferation financing by recognizing the broad scope of proliferation-related threats beyond the implementation of U.N.-targeted financial sanctions. These include novel and evolving activities that are not fully captured by U.N. sanctions lists of individuals and entities—especially while they are not being updated—such as Iran’s illicit procurement of Western technology and myriad North Korean revenue-generating activities.
The FATF expanded the scope of its counterproliferation recommendations in 2020 to require all states to assess and mitigate proliferation financing risks. But it has yet to fully operationalize the strength of this foundation. The scope is limited to Iran and North Korea, for one, despite risks from other countries like Russia, China, and Pakistan. Promisingly, however, a FATF report from June on proliferation financing typologies explicitly notes the threat that Russia poses to counterproliferation and sanctions implementation efforts—a positive sign of the potential broadening of the FATF’s thinking. Still, simply acknowledging the threat will not compel states to adjust their assessments of proliferation financing risk accordingly.
Next, the FATF should elevate proliferation financing as a key measure in its blacklisting criteria so that it has equal status with money laundering and terrorist financing. This approach would rejuvenate sanctions regimes by forcing states to focus on counterproliferation diplomacy rather than the mere implementation of targeted financial sanctions. Russia, for example, could be made subject to the FATF blacklist due to its proliferation financing threats, requiring all FATF members, not just Western countries, to effectively block Russia from international banking.
An intergovernmental organization like the FATF may not be immune from the type of political dysfunction that hobbled the U.N.’s sanctions regimes on Iran and North Korea. As a consensus-based organization, major decisions—like blacklisting a country—require a consensus from all members. In October 2024, China, along with India, Saudi Arabia, South Africa, and Brazil, voted against Ukraine’s request to place Russia on the FATF’s blacklist.
But there are significant differences between the Security Council and the FATF. For one, the FATF is more narrowly focused on technical and evidence-based policymaking than the Security Council. In other words, FATF decision-making is a peer-review process, not a political negotiation, and is less prone to the standoffs seen at the Security Council. While every member of the FATF has a de facto veto power, its 200-plus members are financial experts and regulators who share a common interest in protecting the integrity of the global financial system and have demonstrated strong commitments to implementing FATF standards.
And, unlike the Security Council, the FATF has baked-in procedures to ensure member states continue to act in good faith. In February 2023, for example, the FATF Plenary, the organization’s decision-making body that meets three times a year, suspended Russia’s membership. According to the FATF, Russia’s actions “unacceptably run counter to the FATF core principles aiming to promote security, safety, and the integrity of the global financial system.” This ability to take action against a state that threatens FATF standards acts as a guardrail against the kind of political dysfunction that plagues the Security Council.
The paralysis of the Security Council has given rise to a dangerous new reality and the erosion of the very foundations of the global nonproliferation regime. The FATF is a promising platform to shore up international mechanisms against WMD proliferation. The alternative—passively allowing counterproliferation norms to deteriorate completely under the weight of great-power rivalry—is far more dangerous.
