Monaco, home to the world’s largest number of billionaires and billionaires, is at risk of being added to the “grey list” at a meeting next week because it has not gone far enough in combating illicit financial flows.
The Financial Action Task Force (FATF) will hold a general meeting in Singapore from June 26 to 28. After the meeting, Monaco is expected to be added to the grey list and Turkey to be removed from the list.
Countries added to the list will have to be monitored more closely, which could make foreign investors more cautious about doing business there.
According to a 2021 International Monetary Fund (IMF) report, grey-listed countries experienced a “large and statistically significant decline in capital inflows.”
Turkey expected to be removed from the list
A range of topics are on the agenda when the general assembly meets behind closed doors starting next week. Bloomberg reported last month that Turkey was expected to be removed from the grey list.
A report assessing the systems in place in India and Kuwait will also be discussed at the meeting.
The FATF met with Turkish authorities to discuss developments regarding money laundering and illicit lending.
A person familiar with the talks, which lasted several days, said the “on-site” visit was aimed at assessing Turkey’s progress in fighting money laundering and terrorist financing.
The source said the team’s report would form the basis for decisions to be taken at the FATF plenary session on June 28.
In a statement in February, Finance Minister Mehmet Simsek said Turkey had completed a technical review with the FATF to remove the country from the grey list. “The process of removing the country from the grey list will be completed with an on-site inspection in June,” Simsek said.
what happened?
The FATF, which evaluates countries’ performance in fighting international financial crimes, added Turkey to its so-called grey list in 2021 for lagging behind in the fight against money laundering and terrorist financing.
It was not clear which government, private sector and non-governmental organisations and officials the FATF team met with in Turkey. Besides Turkey, the FATF’s grey list includes 20 other countries, including Nigeria, South Africa, Bulgaria, the Democratic Republic of Congo, the Philippines and Syria.
According to the IMF study, being on the grey list could strain relations with foreign banks and investors, so if Turkiye is removed from the grey list in June, it could boost the value of TL and strengthen its assets.
How do I leave the list?
Established more than 30 years ago at the initiative of the G7 and based in Paris, the FATF has around 40 member countries, including the United States, China, the European Commission and the Gulf Cooperation Council.
The group aims to combat money laundering and terrorist financing by blocking investment in non-compliant countries through grey and blacklists.
To avoid grey list designation, a majority of FATF member states must agree that a country has made sufficient progress since the start of the evaluation period.
