Countries Classified as High-Risk for Money Laundering Activities

Financial Action Task Force Identifies High-Risk Countries for Money Laundering and Terrorist Financing

In the ever-evolving landscape of global finance, the Financial Action Task Force (FATF) plays a crucial role in combating financial crime. As of mid-2025, the FATF has identified several countries as high-risk jurisdictions, subject to increased scrutiny and countermeasures.

The Black List (High-Risk) currently includes North Korea, Iran, and Myanmar. These countries have significant strategic deficiencies in their anti-money laundering (AML) and combating the financing of terrorism (CFT) regimes and pose serious risks related to money laundering, terrorist financing, and proliferation financing. The FATF urges enhanced due diligence, effective countermeasures, and targeted financial sanctions against these jurisdictions to protect the international financial system.

In contrast, the Grey List (Increased Monitoring) includes countries under increased scrutiny but cooperating to address their AML/CFT deficiencies. Examples of changes to the grey list as of mid-2025 include the addition of the British Virgin Islands and Bolivia, and the removal of Croatia, Mali, and Tanzania.

Businesses must be aware of these designations when engaging in transactions or relationships with customers or corporate entities from these high-risk countries. Enhanced Due Diligence (EDD) measures are necessary in such situations, which may include verification of sources of wealth and funds, among other checks.

Regulated financial institutions are legally obligated to adhere to international and local AML/CFT standards. Companies dealing with customers from high-risk third countries should be aware of potential financial sanctions and should assess risk factors related to suspicious customer interactions from high-risk countries by applying a risk-based approach and screening sanctions lists, global watchlists, Politically Exposed Persons (PEPs) lists, adverse media, and other similar sources.

The FATF's latest country report was published in June 2024, providing updates on the status of various countries and their AML/CFT efforts. It's essential for businesses to stay informed about these designations and the measures required to mitigate the risks associated with high-risk jurisdictions.

References: [1] FATF (2024). FATF Public Statement - June 2024. Retrieved from https://www.fatf-gafi.org/media/fatf/documents/recommendations/Updated-June-2024-FATF-Public-Statement.pdf [2] FATF (n.d.). Jurisdictions and territories. Retrieved from https://www.fatf-gafi.org/countries/jurisdictions/ [3] FATF (2023). FATF Public Statement - October 2023. Retrieved from https://www.fatf-gafi.org/media/fatf/documents/recommendations/Updated-October-2023-FATF-Public-Statement.pdf [4] European Union (2023). EU list of high-risk third countries. Retrieved from https://ec.europa.eu/info/publications/eu-list-high-risk-third-countries_en

The Financial Action Task Force (FATF) also suggests that lifestyle businesses, technology companies, education-and-self-development platforms, and even casino-and-gambling establishments should enhance their know-your-customer (KYC) procedures when dealing with customers from high-risk countries.
In the realm of entertainment, it is crucial for media organizations to be aware of potential AML/CFT risks arising from high-risk countries, as their artists, producers, or sponsors could potentially have ties to these jurisdictions.
General news outlets and sports broadcasters should also pay attention to the FATF updates, as their coverage might inadvertently reveal information related to money laundering or terrorist financing activities involving high-risk countries.
Keeping abreast of weather forecasts and warnings could potentially help businesses anticipate and adjust their strategies in regions where natural disasters in high-risk countries might lead to increased financial activity or instability.
As more high-risk countries are included in the FATF's Black List, the international business community may emphasize the importance of ethical and responsible finance as part of their overall lifestyle, reinforcing a commitment to transparency, accountability, and socially responsible practices.