Despite coronavirus impacts FATF removes Iceland and Mongolia from grey list, remains committed to AML/CFT brief

Due to the impacts of the coronavirus pandemic, the work of the Financial Action Task Force (FATF) has been significantly disrupted this year, including its work determining ‘jurisdictions under increased monitoring’.

These jurisdictions – often referred to externally as countries on the FATF grey list – also run the risk, if they fail to implement sufficient anti-money laundering and counter terrorist financing (AML/CFT) measures, of inclusion on the global AML/CFT watchdog’s blacklist of ‘high risk jurisdictions’. 

Inclusion on the blacklist alongside current high risk jurisdictions Iran and North Korea essentially bars a jurisdiction from the global financial system.

Iceland and Mongolia

Due to travel restrictions and business disruptions, FATF’s customary mutual evaluation processes for identifying and monitoring high-risk jurisdictions or jurisdictions with strategic weaknesses in their AML/CFT measures and placing them under – or releasing them from – increased monitoring have been disrupted during 2020.

At its October plenary meeting however, the FATF was able to determine that it no longer considers Iceland and Mongolia jurisdictions under increased monitoring, but other countries already on the grey list remain on it.

Current grey list

Mutual evaluations have been carried out in nine of the seventeen jurisdictions under increased monitoring that remain on the grey list.

In April these jurisdictions were given an additional four months for deadlines to meet the requirements of FATF and, except for Iceland and Mongolia, there have been significant disruptions to the normal flow of mutual evaluations, discussions and updates issued by the global watchdog over recent months.

The remaining grey listed jurisdictions were given the option by FATF not to report at the October plenary meeting given their focus on addressing the impact of the pandemic. Albania, Botswana, Cambodia, Ghana, Mauritius, Pakistan, and Zimbabwe chose to report and FATF has published updated statements. Barbados, Jamaica, Myanmar, Nicaragua, Panama and Uganda deferred reporting. FATF has not revealed responses for the Bahamas, Syria or Yemen. 

Disruption continues

FATF says that the crisis is continuing to impact some of the FATF mutual evaluation and follow-up processes while countries’ situations and responses to the pandemic vary, but it remains committed to carrying out its work of assessing the effective implementation of its standards. 

Delegates at the October plenary meeting discussed how to continue mutual evaluations flexibly when crisis response measures limit or impede travel.  They discussed the objective criteria and procedures, including to conduct certain aspects of the on-site visit virtually or, if necessary, to postpone on-site visits.



Categories: Trade Based Financial crimes News

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