The Financial Action Task Force (FATF) has released its most recent revisions to the worldwide list for combating money laundering and terrorist financing, keeping South Africa on the grey list, including Monaco, and eliminating Turkey. This choice comes after a thorough assessment of each nation’s adherence to global regulations.
Since February 2023, South Africa has been listed as non-compliant but has shown improvement in rectifying issues in its anti-money laundering and counter-terrorist financing systems. Nevertheless, the FATF highlighted the necessity for further efforts to completely adhere to the established criteria.
FATF President T. Raja Kumar mentioned that South Africa has made commendable efforts to enhance its regulatory framework, but there are still notable gaps. He emphasized the country must persist in fortifying its financial system to combat illegal activities.
Being on the grey list indicates that South Africa is under increased monitoring but is cooperating with the FATF to address identified issues. The listing can affect investor confidence and raise the cost of doing business, as international banks and financial institutions often apply enhanced due diligence to transactions involving grey-listed countries.
Monaco, newly added to the grey list, faces scrutiny over its financial practices. The FATF cited the need for the principality to enhance its regulatory mechanisms to prevent money laundering and terrorist financing effectively. “Monaco must prioritize robust measures to protect its financial system and ensure compliance with global standards,” Kumar added.
Conversely, Turkey has been removed from the grey list after demonstrating substantial improvements in its regulatory environment. The FATF acknowledged Turkey’s significant strides in enhancing its legal and institutional frameworks to combat financial crimes. “Turkey’s removal from the grey list reflects its strong commitment to implementing effective measures against money laundering and terrorist financing,” the FATF President remarked.
The grey list’s revisions are part of the FATF’s ongoing efforts to ensure that countries maintain rigorous financial controls to prevent criminal exploitation of their financial systems. The organization’s periodic reviews and updates serve as a critical tool in promoting transparency and accountability in global financial practices.
Countries on the grey list are subject to increased monitoring and are required to report regularly on their progress in addressing the FATF’s recommendations. Failure to make sufficient improvements can lead to further consequences, including potential blacklisting, which carries severe economic sanctions and restrictions.
As South Africa continues its efforts to exit the grey list, the government has reiterated its commitment to enhancing its financial regulatory framework. “We are determined to address all the issues identified by the FATF and ensure that our financial system is secure and resilient,” said South Africa’s Minister of Finance, Enoch Godongwana.
The inclusion of Monaco and the removal of Turkey highlight the dynamic nature of the FATF’s assessments and the ongoing global efforts to combat financial crimes. Countries worldwide remain vigilant in their commitment to maintaining robust and transparent financial systems.
