24 Feb FATF Grey List: Understanding the Latest Plenary

The FATF grey list refers to jurisdictions under increased monitoring by the Financial Action Task Force (FATF) due to strategic deficiencies in their anti-money laundering (AML) and counter-financing of terrorism (CFT) regimes. These countries have committed to addressing these deficiencies within agreed timeframes and are working with FATF and FATF-style regional bodies (FSRBs) to implement necessary reforms.

Countries Currently on the FATF Grey List

As of the latest review on February 21^st 2025, the following countries are included on the FATF grey list:

• Africa: Algeria, Angola, Burkina Faso, Cameroon, Côte d’Ivoire, Democratic Republic of the Congo, Kenya, Mali, Mozambique, Namibia, Nigeria, South Africa, South Sudan, Tanzania
• Middle East & Asia: Lebanon, Lao PDR, Nepal, Syria, Vietnam, Yemen
• Europe: Bulgaria, Croatia, Monaco
• Americas: Haiti, Venezuela

In contrast, the Philippines successfully completed its action plan and has been removed from the list.

Implications of Being on the FATF Grey List

1. Economic and Financial Repercussions

Countries placed on the FATF grey list face significant economic challenges, including:

• Increased scrutiny from international financial institutions.
• Heightened due diligence requirements for businesses operating in or with these countries.
• Reduced foreign investment due to concerns over financial stability.

2. Regulatory Compliance and Monitoring

While being on the grey list does not automatically lead to sanctions, it does require businesses and financial institutions to apply risk-based due diligence when dealing with entities from these jurisdictions. The FATF does not encourage blanket de-risking but instead advocates for careful risk assessment.

How Businesses Can Mitigate Risk When Dealing with Grey-Listed Jurisdictions

Businesses and financial institutions dealing with clients or partners from FATF grey-listed countries should implement robust compliance strategies, including:

• Conducting enhanced due diligence (EDD) on transactions involving these jurisdictions.
• Strengthening AML/CFT training for employees to identify potential risks.
• Leveraging technology-driven AML solutions to automate risk assessment and transaction monitoring.

AML Training for Effective Compliance

Given the complexities of compliance with FATF regulations, corporate entities must prioritise AML training to ensure adherence to international standards.

KYC Lookup: A Leading AML Training Provider

KYC Lookup is a UK-based, fully accredited AML training provider offering online courses designed for corporate clients. Their training programs cover:

• FATF compliance requirements
• KYC (Know Your Customer) best practices
• Risk-based approach to AML monitoring
• Enhanced due diligence procedures

By equipping employees with expert knowledge, companies can effectively mitigate the risks associated with transactions involving grey-listed jurisdictions.

FATF Grey List: The Road to Compliance and Removal

To be removed from the FATF grey list, jurisdictions must complete a series of reforms, including:

• Strengthening their regulatory frameworks to combat money laundering and terrorist financing.
• Enhancing transparency and governance in financial institutions.
• Demonstrating successful implementation of FATF action plans.

Final thoughts, the FATF grey list plays a crucial role in promoting global financial integrity by identifying and monitoring jurisdictions with AML/CFT deficiencies. While inclusion on the list poses economic and regulatory challenges, businesses can navigate these risks through comprehensive compliance measures and AML training programs such as those provided by KYC Lookup. By staying informed and proactive, companies can maintain strong compliance standards and mitigate the risks of financial crime.