Financial Action Task Force blacklist


The Financial Action Task Force blacklist is a blacklist maintained by the Financial Action Task Force.
The blacklist has been issued by the FATF since 2000, and lists countries which FATF judges to be non-cooperative in the global fight against money laundering and terrorist financing, calling them "Non-Cooperative Countries or Territories".
Although non-appearance on the blacklist was perceived to be a mark of approbation for offshore financial centres that are sufficiently well regulated to meet all of the FATF's criteria, in practice, the list included countries that did not operate as offshore financial centres. The FATF updates the blacklist regularly, adding or deleting entries.
The FATF describes "High-risk jurisdictions subject to a Call for Action" as having "significant strategic deficiencies in their regimes to counter money laundering, terrorist financing, and financing of proliferation. For all countries identified as high-risk, the FATF calls on all members and urges all jurisdictions to apply enhanced due diligence. In the most serious cases, countries are called upon to apply counter-measures to protect the international financial system from the ongoing money laundering, terrorist financing, and proliferation financing risks emanating from the country". As of November 2022, only three countries were on the FATF blacklist: North Korea, Iran, and Myanmar.
The FATF has been characterized as effective in shifting laws and regulations to combat illicit financial flows. FATF incentivizes stricter regulations through its public noncomplier list, which leads financial institutions to shift resources and services away from the countries on the blacklist. This in turn motivates domestic economic and political actors in the listed countries to pressure their governments to introduce regulations that are compliant with the FATF.

History

The FATF was established by the G7 summit that was held in Paris in July 1989. Founding stakeholders include the G-7 Heads of State or Government, the President of the European Commission and eight other countries.
The term "non-cooperative" was criticized by some analysts as misleading, as a number of countries on the list simply lacked the infrastructure or resources to cope with relatively sophisticated financial criminals who tried to operate there. Since 2008 the FATF has, at the behest of G20 leaders, installed a more analytical process for identifying jurisdictions deficient in their anti-money laundering and anti-terrorist financing regimes.

Primary works

One of the main objectives of the FATF is to establish norms and standards of "legal, regulatory and operational measures" to fight against money laundering, terrorist financing and other related threats to the security and integrity of the international financial system. However, FATF "has no investigative authority." FATF works with nation-states to bring legislative changes and regulatory reforms in the aforementioned sectors. In addition, the FATF also provides policy recommendations that meet international standards to countries for combating money laundering and the financing of terrorism and the proliferation of weapons of mass destruction. FATF has been providing policy recommendations since 1990 and their recommendations have been revised four times since then. FATF also monitors the situations of its members in establishing adequate measures and institutions to fight against money laundering and terrorist financing. FATF also makes sure that it is aware of national-level vulnerabilities of its member states "with the aim of protecting the international financial system from misuse."

FATF member nations

Full members

According to its official website, there are 39 members of FATF and two Regional Organisations, representing most financial centers around the world.
The list consisted of the following countries:

  40. Observer nations

There are currently no FATF observer nations, but many financial institutions participate at that level.

FATF Blacklisting reports

The Blacklist is a term used by the media, which is officially called a "Call for action" nations by the FATF.

June 2000 report

The initial list of fifteen countries regarded as uncooperative in the fight against money laundering, was published in June 2000. The list consisted of the following countries:

  13. June 2001 report

The second FATF report, published in 2001 and including a supplemental report in September, denoted a further eight countries as non-cooperative:

  8. June 2002 report

According to June 2002 report from FATF, following countries were listed as NCCTs.

  13. June 2003 report

According to a June 2003 report from FATF, the following countries were listed as NCCTs.

  9. July 2004 report

According to the July 2004 report from FATF, the following countries were listed as NCCTs.

  6. June 2005 Report

According to June 2005 report from FATF, the following were listed as NCCTs.

  3. June 2006 report

The seventh list, published in June 2006, listed only the following country as non-cooperative:

  1. June 2007 report

FATF's Eighth NCCT Review listed no countries as non-cooperative. Myanmar was removed on 13 October 2006, Nauru on 13 October 2005 and Nigeria on 23 June 2006.

June 2008 report

FATF's Ninth Review identified the following countries as high risk and non-cooperative.

  6. June 2009 statement

FATF issued a "public statement" on 25 February 2009 noting concerns and encouraging greater compliance by the following countries:

  3. October 2010 Statement

The following country has not made sufficient progress in addressing the deficiencies or has not committed to an action plan developed with the FATF to address the deficiencies.

  1. October 2011 Statement

The following countries have not made sufficient progress in addressing the deficiencies or have not committed to an action plan developed with the FATF to address the deficiencies.

  10. February 2012 statement

A total of 17 countries were labeled as high-risk and non-cooperative jurisdictions by FATF. All listed countries below are defined as such; counter-measures were in force only for Iran and the Democratic People's Republic of Korea.
High-risk and non-cooperative countries, to whom counter-measures applied:
High-risk and non-cooperative countries, not committed to an action plan:

  14. June 2013

A total of 14 countries were identified as jurisdictions that have strategic deficiencies that pose a risk to the international financial system.
Jurisdictions subject to a FATF call on its members and other jurisdictions to apply counter-measures to protect the international financial system from the ongoing and substantial money laundering and terrorist financing risks emanating from the jurisdictions.
Jurisdictions with strategic AML/CFT deficiencies that have not made sufficient progress in addressing the deficiencies or have not committed to an action plan.

  11. October 2013 statement

A total of 13 countries were identified as jurisdictions that have strategic deficiencies that pose a risk to the international financial system.
Jurisdictions with strategic AML/CFT deficiencies that have not made sufficient progress in addressing the deficiencies or have not committed to an action plan.

  9. February 2014

A total of 11 countries were identified as jurisdictions with strategic deficiencies posing a risk to the international financial system.
Jurisdictions with strategic AML/CFT deficiencies that have not made sufficient progress in addressing the deficiencies or have not committed to an action plan.

  8. June 2014 statement

A total of 6 countries were identified as jurisdictions that have strategic deficiencies that pose a risk to the international financial system.
Jurisdictions with strategic AML/CFT deficiencies that have not made sufficient progress in addressing the deficiencies or have not committed to an action plan.

  4. February 2015 statement

Jurisdictions subject to a FATF call on its members and other jurisdictions to apply counter-measures to protect the international financial system from the ongoing and substantial money laundering and terrorist financing risks emanating from the jurisdictions.
Jurisdictions with strategic AML/CFT deficiencies that have not made sufficient progress in addressing the deficiencies or have not committed to an action plan developed with the FATF to address the deficiencies. The FATF calls on its members to consider the risks arising from the deficiencies associated with each jurisdiction, as described below.

  3. October 2015 statement

The FATF statement issued on 23 October 2015 identified three high-risk and non-cooperative jurisdictions:
Call to apply counter-measures:
Jurisdictions with strategic deficiencies:
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