Title: Democratic Republic of Congo Remains a High-Risk Jurisdiction: Implications for Businesses
The Financial Action Task Force (FATF) has updated its list of jurisdictions with inadequate anti-money laundering (AML), counter-terrorist financing (CTF), and counter-proliferation financing (CPF) measures in place. The Democratic Republic of Congo (DRC) remains on this list with significant consequences for businesses operating there.
FATF’s List of High-Risk Jurisdictions (February 2024)
The following countries are considered high-risk jurisdictions as of February 2024:
- Bulgaria
- Burkina Faso
- Cameroon
- Croatia
- Democratic People’s Republic of Korea (DPRK)
- Democratic Republic of the Congo
- Haiti
- Iran
- Jamaica
- Kenya
- Mali
- Mozambique
- Myanmar
- Namibia
- Nigeria
- Philippines
- Senegal
- South Africa
- South Sudan
- Syria
- Tanzania
- Turkey
- Vietnam
- Yemen
Consequences of DRC’s Inclusion
DRC’s inclusion on this list signifies that it is subject to financial sanctions measures. Institutions dealing with clients or entities from these jurisdictions must take enhanced due diligence (EDD) measures to ensure stricter customer screening and ongoing monitoring.
FATF’s Evaluation of High-Risk Jurisdictions
The FATF’s evaluation notes that all countries on this list exhibit considerable shortcomings in their AML, CTF, and CPF control frameworks. It is essential for businesses to be aware of these risks and apply EDD measures in any transaction or business relationship involving parties based in high-risk third countries.
The FATF’s List Review Schedule
The FATF’s list is reviewed and updated three times a year following each plenary meeting in February, June, and October. The next revision is anticipated on June 28, 2024. For more information, you can find the FATF’s lists and the meeting schedule on their official website.
The UK’s List of High-Risk Third Countries
Since the end of the Brexit transition period, the United Kingdom has determined its list of high-risk third countries independently. Any amendments to this list are made to address strategic deficiencies in the identified countries’ AML and CTF regimes.
Changes in the UK’s Definition of ‘High-Risk Third Countries’
From January 2024, the UK has updated its definition of ‘high-risk third countries’ in the Money Laundering Regulations 2017. These countries are now defined as those named on either of the FATF’s ‘high-risk jurisdictions subject to a call for action’ or ‘jurisdictions under increased monitoring’ lists.
Past Amendments to the FATF’s List
- July 2016: The European Commission published the original list of high-risk third countries.
- October 2017, December 2017, July 2018, and May 2020: Amendments made to the EU list during that time.
- January 2021: The UK officially adopted its independent list of high-risk third countries.
- January 2024: Amendment to the definition of ‘high-risk third countries’ in the Money Laundering Regulations 2017.
- December 2023, March 2022, July 2021, and November 2021: Additional amendments made to the list since the UK’s departure from the EU.
EDD Measures and Customer Due Diligence
For more information on EDD measures and appropriate customer due diligence, please refer to our comprehensive guide.
Implications for Businesses
Given the DRC’s inclusion on the FATF’s high-risk list, it is essential for businesses to be aware of the implications and follow the necessary EDD measures to minimize potential risks.