FATF Grey List (Greylisting)

The Financial Action Task Force (FATF) maintains a list of jurisdictions, also known as the "Increased Monitoring List," identified as having strategic deficiencies in their Anti-Money Laundering (AML) and Counter-Terrorist Financing (CFT) regulations. These countries are subject to increased monitoring by the FATF to assess their progress in addressing the identified weaknesses. The FATF collaborates with the listed jurisdictions to help them strengthen their AML/CFT frameworks within a designated timeframe. The ultimate goal is for the jurisdiction to implement effective AML/CFT measures and exit the Grey List.

Understanding the FATF Grey List Process

Step 1: Identification of Strategic Deficiencies

Through ongoing evaluations, the FATF identifies weaknesses in a country's AML/CFT regime.

Step 2: Public Statement and Increased Monitoring

The FATF publicly identifies the jurisdiction and outlines the identified deficiencies. The jurisdiction is placed under increased monitoring, and a timeframe is set to address the issues.

Step 3: Technical Assistance and Collaboration

The FATF works collaboratively with the listed jurisdiction, offering technical assistance and guidance to help them improve their AML/CFT regulation.

Step 4: Re-evaluation and Potential Exit

The FATF regularly re-evaluates the progress made by the listed jurisdiction. Once satisfied that the deficiencies have been addressed, the country exits the Grey List.

Implications of Being on the FATF Grey List

While not a sanction, being on the Grey List can have negative consequences for a jurisdiction:

Reputational Damage: Inclusion on the Grey List can damage a country's financial reputation and deter foreign investment.

Increased Scrutiny: Financial institutions may apply enhanced due diligence measures to transactions involving the listed jurisdiction.

Staying AML/CFT Compliant with Smile ID

At Smile ID, we understand the importance of robust AML/CFT compliance. Our solutions can empower you to:

Implement Effective AML/CFT Controls: Our tools can streamline customer due diligence (CDD) and enhanced due diligence (EDD) processes to meet regulatory requirements.

Ongoing Risk Monitoring: Smile ID's solutions can provide continuous transaction monitoring to identify and mitigate potential money laundering or terrorist financing risks.

Stay Informed of Evolving Regulations: We keep you updated on the latest FATF regulations and best practices to ensure your compliance.

To get started, talk to one of our experts here.

Watch Webinar: 

• KYC/AML compliance in African markets

Also read:

• Understanding Kenya's Grey Listing by FATF: A Call for Strengthening KYC Procedures
• South Africa FATF grey listing: What does it mean for businesses?

The FATF Grey List serves as a crucial mechanism for improving global AML/CFT standards. Understanding the Grey List process and its implications is essential for business success. By partnering with Smile ID, you can implement robust AML/CFT compliance measures, mitigate risks, and operate with confidence.