FATF Grey List & Blacklist Countries [2026] — Updated Complete Guide

The FATF grey list (Jurisdictions Under Increased Monitoring) currently contains 23 countries as of the February 2026 plenary, including Algeria, Bulgaria, Kenya, Syria, Venezuela, and Vietnam. The FATF blacklist (High-Risk Jurisdictions) contains Iran, North Korea, and Myanmar. Being on either list has serious consequences for banking access, trade finance, and AML compliance obligations.

The Financial Action Task Force (FATF) lists are among the most consequential risk indicators in international finance. Banks apply automatic enhanced due diligence to grey-listed countries; blacklisted countries face near-total correspondent banking isolation. For businesses operating in or with these jurisdictions, understanding the full current lists — and what they mean in practice — is essential for compliance and operational planning. Our sanctions compliance counsel advises clients operating across high-risk jurisdictions on combined FATF and OFAC compliance requirements.

What Is FATF and Why Do Its Lists Matter?

The Financial Action Task Force is an intergovernmental body established in 1989 by the G7 to develop standards for combating money laundering and terrorist financing. FATF currently has 39 members (37 member jurisdictions plus the European Commission and Gulf Cooperation Council) and its recommendations are adopted as law or regulation in most countries worldwide.

FATF’s influence on banking is profound. When FATF identifies a country as having strategic AML/CFT deficiencies, correspondent banks worldwide — regardless of FATF membership — immediately apply enhanced due diligence and often restrict transactions with that country. The reputational and financial costs of listing are severe and immediate, often exceeding the direct regulatory consequences.

FATF updates its lists three times per year after plenary sessions held in February, June, and October. Businesses must track updates regularly — a country can move from clean to grey-listed (or vice versa) within months. Always verify current lists at fatf-gafi.org. For combined FATF and economic sanctions analysis, consult our team — the two regimes frequently overlap and must be assessed together.

The FATF Blacklist (2026): High-Risk Jurisdictions

The FATF blacklist — formally titled “High-Risk Jurisdictions Subject to a Call for Action” — currently contains three countries: Iran, North Korea (DPRK), and Myanmar. The blacklist has not changed since Myanmar’s addition in 2022.

Blacklisted countries face the most severe FATF-mandated responses. FATF calls on its members to apply enhanced due diligence proportionate to the risk and, in the most serious cases, countermeasures — which can include restricting or prohibiting financial transactions entirely. For Iran and North Korea, FATF countermeasures effectively reinforce the what it means to be sanctioned reality: banking access is virtually impossible through the formal international system.

Iran on the FATF Blacklist

Iran has been on the FATF blacklist continuously since 2008. FATF has repeatedly cited Iran for: failure to criminalize terrorist financing adequately; failure to implement FATF recommendations; and active use of the financial system to circumvent international sanctions. Iran’s FATF blacklisting compounds its comprehensive OFAC sanctions exposure — any business attempting to transact with Iran faces both FATF countermeasures (applied by banks globally) and direct OFAC prohibition for U.S.-nexus transactions. An Iran sanctions lawyer can help businesses navigate this dual-regime landscape.

North Korea on the FATF Blacklist

North Korea’s inclusion reflects systemic AML/CFT failures, active state sponsorship of cybercrime and cryptocurrency theft, and refusal to engage with FATF. The Lazarus Group and affiliated hacking organizations have stolen billions in cryptocurrency to fund the DPRK weapons program — all of which constitutes proceeds of crime requiring AML countermeasures. North Korea sanctions under OFAC’s NKSR regime independently prohibit virtually all transactions — FATF blacklisting adds a layer of AML-based restrictions that apply even to the rare transactions not already OFAC-prohibited.

Myanmar on the FATF Blacklist

Myanmar was added to the FATF blacklist in October 2022 following the February 2021 military coup. The coup dismantled Myanmar’s AML/CFT compliance infrastructure, and the military junta — itself subject to targeted OFAC sanctions under EO 14014 — has shown no willingness to re-engage with FATF. Myanmar’s blacklisting has effectively cut off formal banking channels for most Myanmar-related transactions, even those involving private sector counterparties not subject to OFAC designations.

The FATF Grey List (2026): Current 23 Countries

The FATF grey list — formally “Jurisdictions Under Increased Monitoring” — as of the February 2026 plenary includes 23 jurisdictions. These countries have committed to resolving identified AML/CFT deficiencies but have not yet done so:

Recent Changes: What’s New in 2025-2026

FATF made several significant changes at its most recent plenary sessions:

• February 2026 (Added): Kuwait and Papua New Guinea were added to the grey list.
• October 2025 (Removed): Burkina Faso, Mozambique, Nigeria, and South Africa were removed from the grey list after demonstrating sufficient progress on their action plans. South Africa’s removal was particularly notable — it had only been listed since 2023 and its rapid exit reflects robust AML reforms.
• June 2025 (Added): Bolivia and British Virgin Islands (UK territory) were added. (Croatia, Mali, and Tanzania were removed in the same session.)
• February 2025 (Added): Laos and Nepal were added. (Philippines was removed after successfully completing its action plan.)

These changes illustrate that FATF listing is dynamic — countries can and do exit the grey list through demonstrated reform. For businesses, this means compliance teams must monitor FATF updates at every plenary cycle and adjust their risk frameworks accordingly. Our FATF grey list guide provides detailed analysis of each country’s listing and expected timeline for exit.

What FATF Grey Listing Means for Businesses

FATF grey listing does not legally prohibit transactions. However, its practical banking consequences can be as severe as a legal prohibition. Understanding the impact at each level is essential for any business with grey-listed country exposure.

Enhanced Due Diligence (EDD) Requirements

The primary legal consequence of grey listing is mandatory enhanced due diligence. Under FATF Recommendation 19 and its implementing legislation in most jurisdictions, financial institutions must apply EDD to business relationships and transactions involving grey-listed countries. EDD requirements typically include:

• Verification of the full beneficial ownership chain — identifying ultimate beneficial owners and their source of wealth
• Enhanced source-of-funds documentation for all significant transactions
• Senior management approval for establishing new business relationships with grey-listed country counterparties
• Ongoing monitoring of existing relationships at a higher intensity
• Transaction purpose documentation for cross-border payments
• Periodic relationship reviews — more frequent than for standard-risk counterparties

The cost and burden of EDD is significant. Processing times increase, documentation requirements multiply, and some transactions may be declined as too burdensome to process even when legally permissible. Businesses that regularly transact with grey-listed jurisdictions should maintain pre-prepared EDD documentation packages to reduce delays. Our sanctions screening services include EDD workflow design for high-risk jurisdiction transactions.

Correspondent Banking Impacts

The most severe practical consequence of grey listing is correspondent banking de-risking. Correspondent banks — large international banks that provide cross-border payment services to smaller domestic banks — are increasingly unwilling to maintain relationships with banks in grey-listed jurisdictions, even where transactions are legally permissible.

The dynamics of correspondent banking de-risking are well documented by the World Bank and BIS: grey-listed country banks face higher compliance costs (passed on as fees), reduced correspondent banking options, longer transaction settlement times, and in the most affected cases, complete loss of correspondent banking access forcing reliance on informal money transfer channels.