The Principality of Monaco, along with Bulgaria and Côte d'Ivoire, is on the verge of exiting the FATF watchlist. The decision will be made official on October 30, following a positive evaluation of its regulatory reforms.
The Principality of Monaco is on track to leave the 'grey list' of the Financial Action Task Force (FATF) next month, according to Bloomberg. This list includes countries with deficiencies in combating money laundering, and its removal represents a significant advancement in the regulatory reforms of the enclave located on the Côte d'Azur.
Monaco was placed on this list in June 2024 due to failures in its control mechanisms, but FATF evaluators have noted progress that will facilitate its definitive exclusion, along with Bulgaria and Côte d'Ivoire. However, the resolution will not be official until the closure of the FATF plenary on October 30 in Paris, where unanimous consensus from key members is required.
Remaining on this list can have severe economic consequences. A report from the International Monetary Fund (IMF) in 2021 indicated that countries in this situation suffer a notable reduction in capital inflows. In response to the potential exit, markets have reacted positively, with increases in Bulgarian ETFs and shares of Monegasque companies such as Société des Bains de Mer.
To regain international trust, the Monegasque government has tightened its legal framework and increased sanctions. This year, a fine of 6 million euros was imposed on UBS Group AG for failures in its fight against money laundering.
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