Soft, expanding bullets stop more easily when they hit something. Full metal jacket military bullets penetrate things like auto bodies, walls, etc, and pose a greater threat to innocent bystanders.

Plus, the real reason is that in war, wounding the other side is better than killing, since the wounded have to be treated, evacuated, supported, etc., and their presence is demoralizing to the enemy.

Its an offence against the Geneva convention, NATO militaries are worried they will be accused of war crimes if they introduce bullets that could be considered dum dums

Actually the 1899 Hague Convention, and the US is not a signatory. The US reserves the right to use expanding bullets when there is a clear military necessity. Until 2010 the prohibition only applied to warfare between military units, not to combat with irregular or civilians units. https://en.wikipedia.org/wiki/Expanding_bullet