FATF grey list

FATF grey list

FATF grey list

#GS-02 International Relations

For Prelims

About Financial Action Task Force:

  • The Financial Action Task Force (FATF) is the global money laundering and terrorist financing watchdog.
  • It is an inter-governmental body which sets international standards that aim to prevent these illegal activities and the harm they cause to society.
  • The FATF was established in July 1989 at the G-7 Summit in Paris, with an aim to examine and develop measures to combat money laundering.
  • After the 9/11 attacks, the FATF in October 2001 expanded its mandate to incorporate efforts to combat terrorist financing.
  • In April 2012, it added efforts to counter the financing of proliferation of weapons of mass destruction.
  • The FATF currently comprises 37 member jurisdictions and 2 regional organisations

The members of FATF:

  • Argentina, Australia, Austria, Belgium, Brazil, Canada, China, Denmark, European Commission, Finland, France, Germany, Greece, Gulf Co-operation Council, Hong Kong (China), Iceland, India, Ireland, Israel, Italy, Japan, Republic of Korea, Luxembourg, Malaysia, Mexico, Kingdom of Netherlands, New Zealand, Norway, Portugal, Russian Federation, Saudi Arabia, Singapore, South Africa, Spain, Sweden, Switzerland, Türkiye, United Kingdom and United States.
  • Indonesia is given observer status.

Categorisation by FATF:

Grey List:

  • Countries which are considered safe haven for supporting terror funding and money laundering are put in the FATF grey list.
  • Inclusion in Grey list serves as a warning to the country that it may enter the blacklist.
  • They are officially referred to as “jurisdictions with strategic deficiencies.”

Black List:

  • Countries known as Non-Cooperative Countries or Territories (NCCTs) are put in the blacklist.
  • Currently, Islamic Republic of Iran and Democratic People’s Republic of Korea (DPRK) are under High-risk Jurisdiction or blacklist.