Turkiye’s Removal from FATF Gray List: 10 Key Questions Answered

Experts analyze the potential sector-wide benefits from banking to energy following Turkiye’s removal from the Financial Action Task Force’s (FATF) gray list, marking recognition for its efforts in combating terrorism financing and money laundering.

  1. What is FATF? FATF, established in 1989 by G-7 countries in Paris, is an intergovernmental organization focused on setting international standards for combating money laundering, terrorism financing, and proliferation financing.
  2. Which countries are members of FATF? FATF has 39 members, including major economies like the US, UK, China, and Turkiye, who collaborate on policy-making and mutual evaluations to ensure compliance with FATF recommendations.
  3. What are FATF’s areas of focus? FATF plays a crucial role in shaping global policies related to anti-money laundering (AML), countering the financing of terrorism (CFT), and combating the financing of proliferation (CFP) of weapons of mass destruction.
  4. How does FATF’s assessment system work? FATF conducts mutual evaluations based on its 40 recommendations, assessing countries’ compliance with international standards on AML/CFT. This includes the effectiveness of investigations, asset tracing, and international cooperation.
  5. What is the Gray List? The Gray List identifies countries with strategic deficiencies in their AML/CFT regimes, prompting targeted action plans to address these shortcomings under FATF oversight.
  6. How did Turkiye’s journey on the Gray List unfold? Turkiye, a FATF member since 1991, underwent periodic evaluations, leading to its inclusion in the Gray List in October 2021. Subsequent reforms and compliance efforts culminated in its recent removal.
  7. What measures did Turkiye take to exit the list? Since its Gray List placement, Turkiye implemented comprehensive legislative reforms across various sectors, enhancing judicial frameworks, and strengthening institutional capacities to combat financial crimes effectively.
  8. Which countries are currently on the Gray List? As of recent evaluations, countries like Monaco and Venezuela remain on the Gray List due to identified deficiencies in their AML/CFT frameworks.
  9. What are the benefits of exiting the Gray List? Turkiye’s removal is expected to bolster confidence in its financial system, improve international banking relations, and potentially lower borrowing costs, stimulating investment across diverse sectors.
  10. What lies ahead for Turkiye post-exit? Turkiye aims to maintain compliance with international standards, further enhancing its regulatory frameworks and administrative capacities to sustain positive economic impacts and attract foreign investment.

Source: / Prepared by Irem Yildiz

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