The Financial Action Task Force (FATF) has updated its listings of jurisdictions under increased monitoring (the “grey list”) and high-risk jurisdictions subject to a call for action (the “black list”). Our Investment Funds Team examines what investment advisers need to know about the June 2025 changes.
- The FATF has added the British Virgin Islands and Bolivia to its grey list and removed Croatia, Mali, and Tanzania
- The FATF’s black list of Myanmar, Iran, and the Democratic People’s Republic of Korea remains unchanged
- Investment advisers should update their subscription and administrative agreements to reflect the latest FATF listings
On June 23, 2025, the Financial Crimes Enforcement Network (FinCEN) announced the Financial Action Task Force (FATF) has updated its listing of jurisdictions under increased monitoring (known as the grey list) by adding the British Virgin Islands and Bolivia and removing Croatia, Mali, and Tanzania. The FATF’s listing of high-risk jurisdictions subject to a call for action (referred to as the black list) remains unchanged.
Together, the lists serve to alert financial institutions about jurisdictions with strategic deficiencies in their anti-money laundering (AML), countering the financing of terrorism (CFT), and countering the financing of proliferation of weapons of mass destruction (CPF) standards.
Grey-listed jurisdictions are under increased monitoring and have committed to, or are actively working with, the FATF to address those deficiencies in accordance with an agreed-upon timeline.
Jurisdictions on the black list are deemed to have significant strategic deficiencies in their AML/CFT/CPF regimes. FATF members should apply enhanced due diligence and, in the most serious cases, apply countermeasures to protect the international financial system from the risks associated with these jurisdictions.
In the update, the FATF reaffirmed that the three black-listed countries are Myanmar, Iran, and the Democratic People’s Republic of Korea. FinCEN noted that Myanmar is currently subject only to enhanced due diligence measures, whereas Iran and the Democratic People’s Republic of Korea are subject to countermeasures.
Implications for Investment Advisers
Investment advisers are encouraged to review and, where appropriate, update their subscription agreements and administrative agreements to reflect the latest FATF developments, especially in connection with ongoing capital raises and upcoming fund launches.
- Subscription Agreements: Subscription agreements that identify grey-listed and/or black-listed jurisdictions in wiring banks, AML certifications, letters of reference, etc., should be updated to reflect the jurisdictions on the June 2025 grey and black lists.
- Administrative Agreements: Administrative agreements that (1) delegate services to third parties and/or affiliates and (2) identify grey-listed and/or black-listed jurisdictions that may not be delegated such services and/or are limited in the delegation of such services should be updated to reflect the jurisdictions on the June 2025 grey and black lists.
- Alternatively, investment advisers whose subscription agreements or administrative agreements list FATF-member jurisdictions should ensure that those jurisdictions listed reflect the most up-to-date list of FATF members.
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