Why in news?
The Financial Action Task Force (FATF) in February 2026 issued updates to its public lists. The Democratic People’s Republic of Korea, Iran and Myanmar remained on the high‑risk (black) list, and 22 countries were kept under increased monitoring. India is preparing for its next mutual evaluation by the FATF.
Background
The FATF is an intergovernmental body formed in 1989 by the G7 to combat money laundering, terrorist financing and proliferation financing. It sets global standards through its 40 recommendations and evaluates compliance through peer reviews. The secretariat is hosted by the Organisation for Economic Co‑operation and Development (OECD) in Paris.
Membership and organisation
- Members: The FATF has 39 members – 37 jurisdictions and two regional organisations (the Gulf Co‑operation Council and the European Commission)【120393164076934†L232-L236】.
- India’s participation: India joined the FATF in 2010 and is also part of the Asia Pacific Group and the Eurasian Group on money laundering【120393164076934†L238-L243】.
- Global network: Nine regional bodies, including the Asia/Pacific Group and the Middle East and North Africa FATF, ensure that standards are applied worldwide. Member countries undergo mutual evaluations to assess the effectiveness of their anti‑money laundering and counter‑terrorist financing frameworks【120393164076934†L238-L246】.
Lists and monitoring
- High‑risk jurisdictions (black list): Countries with serious strategic deficiencies in their regimes are placed on the black list. As of February 2026 the list includes the Democratic People’s Republic of Korea, Iran and Myanmar. The FATF calls on members to apply enhanced due diligence and countermeasures when dealing with these countries【226872524845451†L165-L197】.
- Jurisdictions under increased monitoring (grey list): These countries work with the FATF to address identified deficiencies. The February 2026 update lists 22 countries, including Kenya, Lebanon, Nepal, Namibia and Vietnam【706980459022749†L173-L179】. Grey‑listed countries must implement action plans within agreed timeframes and are subject to increased oversight.
- Mutual evaluations: Members undergo peer reviews called mutual evaluations. India’s last evaluation was completed in 2010, and the next is scheduled for 2026–27【120393164076934†L238-L246】.
Conclusion
The FATF plays a vital role in safeguarding the international financial system. By setting standards and monitoring compliance, it helps countries prevent money laundering and terrorist financing. India’s upcoming evaluation is an opportunity to strengthen its regulatory framework and enhance global confidence.