Introduction: FATF Grey List and Black List Update
The Financial Action Task Force (FATF) has released a new update to its grey list, signaling shifts in the global anti-money laundering (AML) and counter-terrorist financing (CFT) environment. This adjustment highlights evolving compliance expectations and the need for robust risk management in financial systems worldwide.
The FATF grey list ensures transparency in the financial system by fishing out countries identified as having strategic weaknesses in their AML/CFT regulations and frameworks. These jurisdictions are under increased monitoring, though they have committed to improving their frameworks within agreed timelines. Being listed can lead to reputational damage and heightened scrutiny from international financial institutions.
In contrast, the FATF black list identifies nations with significant, ongoing failures to address AML compliance risks. Entities operating in these high-risk jurisdictions face enhanced due diligence and may be subject to countermeasures, including transaction restrictions and closer regulatory oversight.
Related: FATF Grey List Explained
February 2026 FATF Update: Key Changes
On 13 February 2026, the FATF confirmed that Kuwait and Papua New Guinea have been added to the grey list following evaluations of their AML/CFT regimes. Their recent evaluations revealed compliance gaps requiring further reform.
Notably, no jurisdictions were removed from the grey list during this cycle, reflecting the FATF's continued pressure on monitored countries to demonstrate tangible, sustained progress before earning removal.
The grey list now includes 22 jurisdictions: Algeria, Angola, Bolivia, Bulgaria, Cameroon, Côte d'Ivoire, Democratic Republic of Congo, Haiti, Kenya, Kuwait, Lao PDR, Lebanon, Monaco, Namibia, Nepal, Papua New Guinea, South Sudan, Syria, Venezuela, Vietnam, Virgin Islands (UK), and Yemen.
The FATF's black list remains unchanged, with Iran, North Korea, and Myanmar still flagged as high-risk jurisdictions requiring countermeasures.
The next FATF Plenary is scheduled for June 2026, at which point further additions and removals to the grey list may be announced.
What Countries Must Do Under FATF Monitoring?
Countries placed on the grey list are expected to work closely with FATF or regional bodies to close important compliance gaps. These countries follow customised action plans with specific timelines while FATF encourages members to apply a risk-based approach to AML compliance, ensuring legitimate financial services like remittances and humanitarian aid are protected.
In Kuwait's case, the FATF evaluation identified weaknesses in AML/CFT supervision, beneficial ownership frameworks, and the effectiveness of financial intelligence systems. Kuwait is expected to address these gaps within agreed timelines to secure removal from the grey list.
In Papua New Guinea's case, the evaluation highlighted the need for stronger AML/CFT controls across financial and non-financial sectors, improved supervisory capacity, and more effective investigation and prosecution of money laundering offences.
For the 20 other jurisdictions already under monitoring, including Kenya, Côte d'Ivoire, and Bulgaria — the February 2026 cycle signals that the FATF expects continued and demonstrable progress. The absence of any removals this cycle reinforces that the bar for exit remains high.
For context, Bolivia has taken steps since its addition to the grey list, with progress noted in risk understanding, financial intelligence gathering, and asset recovery efforts. However, challenges remain around special investigative techniques in money laundering cases, investigation of high-risk non-financial sectors, reliable beneficial ownership data, and prosecutions aligned with the country's national risk profile.
The British Virgin Islands (BVI) has also taken steps since its November 2023 Mutual Evaluation Report, including strengthening international cooperation and developing a national CFT strategy. Going forward, the BVI is expected to improve supervision of high-risk sectors like TCSPs (Trust and Company Service Providers), VASPs (Virtual Asset Service Providers), and investment firms, as well as refine beneficial ownership registers, boost the quality of suspicious activity reports (SARs), expand investigations, and upgrade asset confiscation procedures.
The Purpose Behind FATF List Monitoring
The FATF monitoring emphasizes that the grey and black lists are not punitive measures but tools to help nations fix systemic vulnerabilities that could undermine the global financial system. The February 2026 update, with two new additions and no removals, is a clear signal that global AML enforcement is intensifying, not easing. For financial institutions operating across multiple jurisdictions, particularly those with exposure to any of the 22 grey-listed countries, this update reinforces the urgency of robust, real-time AML compliance infrastructure.
The successful removal from the grey list in previous cycles, such as Croatia, Mali, and Tanzania in June 2025, reflects the importance of sustained commitment to reform. Countries that exit benefit from stronger reputations, smoother access to the global financial system, and increased investor confidence. With the next FATF Plenary scheduled for June 2026, jurisdictions currently under monitoring have a defined window to demonstrate progress, or risk further consequences.
