As the sun sets, a ferry glides across the waters of the Golden Horn, with the Suleymaniye Mosque and the city of Istanbul, Turkey, in the background.
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The Financial Action Task Force (FATF), an international watchdog group that specializes in combating money laundering and illicit financial flows, removed Turkey on Friday from its “grey list” of countries requiring special monitoring, giving the country a boost in confidence as it tries to revive its economy.
“FATF welcomes Turkey’s significant progress in improving its AML/CFT regime,” the Paris-based organization wrote in its latest report, using Ankara’s spelling of the country’s name and an acronym for anti-money laundering and combating the financing of terrorism.
The FATF said Turkey has strengthened the effectiveness of its AML/CFT regime to address “deficiencies” cited by the FATF in its October 2021 monitoring report.
These deficiencies included FATF concerns about unregistered money transfer services, a lack of resources dedicated to investigating terrorist financing, suspected involvement in sanctions evasion, a lack of oversight of high-risk sectors used for money laundering such as banking and real estate, and insufficient oversight of non-profit organizations that could be used to fund terrorism.
In its 2021 report, the FATF said sectors such as banking, construction and real estate in Turkey were vulnerable to illicit financing from UN-sanctioned groups such as Islamic State and al-Qaida.
In its 2024 findings, the watchdog concluded that Turkey is “no longer subject to FATF’s enhanced oversight” but that it “should continue to work with FATF to improve its AML/CFT system, including by ensuring continued oversight of non-profit organizations.” [nonprofit organization] The sector is risk-based and compliant with FATF standards.”
The Turkish government welcomed the news, with Finance Minister Mehmet Simsek writing on social media platform X after the decision was announced, along with a Turkish flag emoji, “We did it,” according to the Turkish version of Google Translate.
“This development has further strengthened international investors’ confidence in our financial system. This decision will have very positive consequences for the financial sector and the economy,” Turkish Vice President Cevdet Yilmaz said.
The FATF announcement will boost Turkey’s efforts to revive its economy after years of high inflation, a devalued local currency and unstable levels of foreign investment.
Mohammed Daoud, head of industry practice at ratings agency Moody’s, spoke about the positive impact the new designation will have.
“Turkey’s removal from the Financial Action Task Force (FATF) grey list is a recognition of the great progress made by the Turkish government and various economic sectors in strengthening the fight against money laundering and terrorist financing,” Daoud said.
“This development could boost Turkey’s international reputation and boost foreign investment and ties with European and US institutions.”
