FATF Plenary

Updated High Risk Third Countries


🚨13 June 2025 - FATF Plenary - High Risk Third Countries 

The Financial Action Task Force (FATF) is a non-government body, that provides information and standards on Money Laundering, Terrorist Financing and Proliferation Financing.


The UK been a  member of FATF since 1990 and has adopted this lists commonly known as the Black List and the Grey List which state countries that require a call for action or increased monitoring. 


The countries stated are especially important because of their adoption under the Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations (MLRs). Regulation 33 sets out the obligation to apply enhanced due diligence. 


Refer to: 

Regulation 33(1)(b) 

Regulation 33(3)

LSAG 25 - 5.6.2 Geographic Risk

Black List
These are jurisdictions which have significant strategic deficiencies regarding money laundering, terrorist financing and financing proliferation.
🔴Democratic People's Republic of Korea (DPRK)🔴 Iran🔴Myanmar
🔘Grey List - Increased Monitoring 
These are jurisdictions that are under increased monitoring and are actively working with the FATF to address strategic deficiencies regarding money laundering, terrorist financing and proliferation financing
 1. 🔴Algeria 11. 🔴Lao PDR 21. 🔴Venezuela
 2. 🔴Angola 12. 🔴Lebanon 22. 🔴Vietnam
 3. 🔴Bolivia🔴 13. 🔴Monaco 23. 🔴Virgin Islands (BVI)🔴
 4. 🔴Bulgaria 14. 🔴Mozambique
 24. 🔴Yemen
 5. 🔴Burkina Faso 15. 🔴Namibia
 6. 🔴Cameroon 16. 🔴Nepal
 7. 🔴Côte d’Ivoire 17. 🔴Nigeria
 8. 🔴Democratic Republic of Congo 18. 🔴South Africa
 9. 🔴Haiti
 19. 🔴South Sudan
 10. 🔴Kenya 20. 🔴Syria

Countries Added To the Grey List:

  • Bolivia
  • Virgin Islands (UK)/BVI

Countries Deleted From The Grey List

  • Croatia 
  • Mali
  • United Republic of Tanzania

    🆙HM Treasury Update: Guidance Money Laundering Advisory Notice

    📢❗🚨In March 2025 the Treasury posted an update to February 2025 Guidance


    It stated:

    "Regulation 33(1)(b) of the  requires regulated businesses (“relevant persons”) to apply enhanced customer due diligence measures and enhanced ongoing monitoring in any business relationships with a person established in an  or in relation to any relevant transaction where either of the parties to the transaction is established in an . 

    For these purposes, regulation 33(3) explains that:

      • a relevant transaction means a transaction in relation to which the relevant person is required to apply customer due diligence measures under regulation 27;
      • being established in a country means:
        • in the case of a legal person, being incorporated in or having its principal place of business in that country, or, in the case of a financial institution or a credit institution, having its principal regulatory authority in that country; and
        • in the case of an individual, being resident in that country, but not merely having been born in that country.

    An "HRTC" is defined as:

    “a country named on either of the following lists published by the Financial Action Task Force as they have effect from time to time—

    (i) High-Risk Jurisdictions subject to a Call for Action;

    (ii) Jurisdictions under Increased Monitoring”

    Therefore the FATF Black and the Grey List are HRTC for the purpose of in-scope firms in the AML regime. 

    ℹ️Further information

    You may wish to consider the update from Law Society of Scotland - Client Matter Risk Assessments.


    Paragraph 6 of their guidance relates to Client Location, states that client location 'extends beyond sanctioned jurisdictions or those on so-called "international grey-lists". It also includes high-risk third countries.'


    High Risk Third Countries (HRTC) 

    HM Treasury released an Advisory notice which came into force on 22 January 2024, this note amended the definition of HRTC. 

    It removes Schedule 3ZA containing the list of HRTCs in the MLRs. Instead of referring to a separate schedule, Regulation 33(3)(a) will now define an HRTC as: 


    • a country named on either of the following lists published by the Financial Action Task Force (FATF) as they have effect from time to time— 


    1. High-Risk Jurisdictions subject to a Call for Action; 


    2. Jurisdictions under Increased Monitoring 


    In order to keep abreast of which countries are HRTCs, relevant persons will now have to refer directly to lists published by the Financial Action Task Force (‘FATF’) of ‘Jurisdictions Under Increased Monitoring’ and ‘High-Risk Jurisdictions subject to a Call for Action’. These lists are updated three times a year, on the final day of each FATF Plenary meeting, held every February, June and October.


    Higher Risk jurisdictions 


    You should note that there may be other jurisdictions that present a higher risk of money laundering that are not on the above FATF lists. 


    LSAG section 5.6.2.1 provides further guidance on this. 


    Further resources to help you consider whether a country is higher risk include: 


    Please also see r.33(3) and sections 5.6.2.1, 5.6.2.3 & 6.19.1 of the LSAG guidance for further information and useful links which will assist you. 

    🗓️Key Date:

    Next Plenary: 24th October 2025

    Reminder

    FATF holds 3 HRTC plenaries a year: 


    💕February

    🌞June, and 

    🎃October.

    ℹ️Source:

    👩🏻‍💻📓✍🏻💡So what actions are you planning?

    ⚙️Update your Firm Wide Risk Assessment - identify if you have expose to these geographical risks, assess the risks, and consider your mitigation


    ⚙️Update the Firm's List of High Risk Countries, and or prospect or client questionnaires


    ⚙️Update your Client Matter Risk Assessment - mark that you have considered the changes - decision making and outcome


    ⚙️ Amend where appropriate the prospect or client risk rating


    ⚙️ Apply EDD where appropriate, including source of funds and source of wealth


    ⚙️Update the information requests you seek from your prospective clients


    ⚙️Obtain updating information from your existing clients, checking existing clients for these new geographical risks


    ⚙️What about counterparties and third parties


    ⚙️Seek approval from MLRO/ Compliance Officer - for prospects and clients that now fall within HRTC


    ⚙️Update your High Risk Register


    ⚙️Seek approval from your board regarding updating core documents?


    ⚙️Update your training Plan, and your delivery


    ⚙️Document and record your actions


    ⚙️ Remember the update occurred Friday 13 June 2025 so you need to implement immediately

    🔤Phrases and Acronyms

     Phrases and Acronyms Meaning
     AMLAnti-Money Laundering
    EDDEnhanced Due Diligence
     FATFFinancial Action Task Force
    HRTCHigh Risk Third Country
     Money Laundering Regulations
    MLRs
    Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations 2017

    Disclaimer

    The information provided in this post is not legal or regulatory advice, and it is not intended that it is considered as such. 

    Always make your own inquiries and seek independent legal and regulatory advice from a specialist advisor. 

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