The Financial Action Task Force (FATF), the global watchdog for combating money laundering and terrorist financing, has released its updated list of jurisdictions under increased monitoring, commonly known as the “grey list.” In its February 2025 plenary session, the FATF announced the removal of the Philippines from the grey list while adding Laos and Nepal. These changes reflect the evolving landscape of anti-money laundering and counter-terrorist financing (AML/CFT) compliance across jurisdictions worldwide.
What is FATF grey list?
The Financial Action Task Force (FATF) is an intergovernmental organization established in 1989 to develop policies to combat money laundering, terrorist financing, and other related threats to the integrity of the global financial system. The FATF grey list consists of jurisdictions under increased monitoring due to identified strategic deficiencies in their AML/CFT frameworks. Countries placed on this list must work with the FATF to address these deficiencies within a given timeframe to avoid further consequences, including potential inclusion on the FATF black list, which can result in financial and economic sanctions.
Countries Removed from the Grey List
Philippines
PhilippinesThe FATF commended the Philippines for substantial improvements in its anti-money laundering and counter-terrorist financing (AML/CFT) framework. Key reforms included demonstrating effective risk-based supervision of designated non-financial businesses and professions (DNFBPs), enhancing the use of financial intelligence in investigations, and increasing the identification and prosecution of terrorism financing cases. These efforts culminated in the country's removal from the grey list, reflecting its commitment to strengthening financial system integrity.
The removal marks a significant achievement for the Philippines, enhancing its international financial reputation and reducing the risk of economic restrictions from global financial institutions.
Countries Added to the Grey List
Laos and Nepal
Laos and 
NepalConversely, Laos and Nepal have been added to the grey list due to identified strategic deficiencies in their AML/CFT regimes. Both nations have committed to working closely with the FATF to address these issues promptly. Specific areas of concern include enhancing risk-based supervision, improving the availability and accuracy of beneficial ownership information, and increasing efforts in investigating and prosecuting money laundering and terrorist financing activities.
Both Laos and Nepal have committed to working with the FATF to implement time-bound action plans to address these deficiencies.
Current Countries on the FATF Grey List
Implications of the Grey List
Countries on the grey list are subject to increased monitoring and must work closely with the FATF to implement corrective measures within specific timeframes. While being placed on the grey list does not result in direct sanctions, it can significantly impact a country’s financial and investment environment. Financial institutions may impose stricter due diligence measures, leading to potential slowdowns in cross-border transactions and foreign investments.
The FATF’s ongoing evaluations serve as a critical mechanism for maintaining the integrity of the global financial system by ensuring jurisdictions adhere to international AML/CFT standards. As countries like the Philippines successfully exit the grey list, others, such as Laos and Nepal, now face the challenge of strengthening their compliance frameworks to avoid long-term economic repercussions.
The FATF will continue to monitor the progress of all jurisdictions under increased scrutiny and will release further updates in its upcoming plenary sessions.
- #FATF
- #GreyListFebruary2025
- #Philippines
- #Laos
- #Nepal
- #HighRiskJurisdictions
03 Mar 2025
