What is the main function of the FATF?

The main function of the FATF, or Financial Action Task Force, is indeed to set international standards for combating financial crimes. Established in 1989, the FATF's primary goal is to develop policies to combat money laundering and terrorist financing. By creating standards and promoting effective implementation of legal, regulatory, and operational measures, the FATF aims to enhance global efforts to address these financial crimes.

This function is crucial because it helps maintain the integrity of the international financial system. By establishing a framework that countries can adopt, the FATF promotes cooperation among nations, supports law enforcement efforts, and encourages the sharing of information to tackle risks associated with illicit financial flows.

Other options do not accurately represent the FATF’s role. The organization does not provide loans, conduct financial audits, or hold oversight on banking institutions in a regulatory capacity. Instead, it functions strategically at a high level, influencing national policies and practices to combat financial crime on a global scale.