FATF Grey List: Risks And Opportunities?
As the Principality could be removed from the Financial Action Task Force's (FATF) Grey List in October 2026, the new Minister of Finance and Economy, Frédéric Cottalorda, stresses that the fight against money laundering has become a key factor in the Principality's attractiveness.
"We must realise that removal from the FATF list will not be an end in itself," stated Frédéric Cottalorda, Minister of Finance and Economy, during the latest Club Eco event, organised by the Monaco Economic Board and the Nice-Matin Group, which focused on the fight against money laundering (AML/CFT ). Beyond the immediate goal of exiting the FATF Grey List, potentially in October 2026, Monaco’s authorities aim to transform compliance from a constraint into a competitive advantage.
Monaco Under Scrutiny
Since being placed on the FATF Grey List in June 2024, Monaco has been operating under enhanced monitoring. The efforts undertaken have already significantly altered the landscape, a point reiterated by Frédéric Chartier, Executive Coordinator of the Committee for the Coordination and Monitoring of the National Strategy against Money Laundering: "Currently, out of 40 technical compliance criteria, Monaco meets 39." During the June 2026 plenary session, the FATF acknowledged that the Principality "had largely completed its action plan, particularly regarding the two key areas of improving judicial effectiveness through the application of sanctions and increasing the seizure of criminal assets." The process is now moving to the next stage: "An on-site visit is now warranted to verify that the implementation of AML/CFT reforms has effectively begun and is continuing sustainably and that the necessary political commitment remains in place to ensure their long-term application," the FATF commented. This implies (barring any issues) an exit from the list following October's assessment mission.
Not Just A Link In A Chain
According to Frédéric Cottalorda, the fight against money laundering works like a chain. "Everyone holds a link." Banks, notaries, real estate agents, lawyers and judicial authorities all view the same transaction from different angles. For example, in a single property transaction, a bank will analyse financial flows, the estate agent will observe the buyer's behaviour and the solicitor will examine the property's history and valuation discrepancies: three distinct perspectives on the same transaction.
Clearly though, it's not that simple. "Compliance can be a constraint on the banking relationship with the client," admits Olivier Pagès, Chief Operating Officer of CMB Monaco. Monaco’s inclusion on the European list led to a slowdown in operations, involving near-systematic checks. Banks must, therefore, "clearly explain the requests, make the controls manageable and ensure that enhanced due diligence does not damage the commercial relationship," he notes.
Security: From Seatbelts To ABS
"In the 1980s, seatbelts were seen as a hassle," illustrates Olivier Pagès by way of comparison but, nowadays, safety has become a major selling point for brands like BMW, Audi and Mercedes. Banking compliance is taking exactly the same route. Once perceived as an administrative burden and an extra cost, security is gradually becoming a differentiating factor amongst financial centres. A bank able to demonstrate the quality of its controls, the fluidity of its operations and the robustness of its monitoring systems inspires greater confidence. This evolution relies on substantial investment. Monégasque banks are now using AI to analyse millions of transactions, detect subtle warning signs and identify atypical behaviour. "Compliance needs to become more proactive," explains Olivier Pagès. There is no other choice for there is no turning back.
"Doing less to attract business would send a very bad signal," warns Frédéric Cottalorda, for whom compliance has become a key factor in investment decisions.
Major financial groups, investment funds and international entrepreneurs now assess a country’s level of transparency and regulatory security with the same scrutiny they apply to its tax regime or economic environment. In other words, compliance has become a form of invisible credit rating. "There are investors who view our financial marketplace with interest but say to us: 'As long as Monaco is on the list, we can't do anything.' Getting off the list is, therefore, a strategic priority and it is now just a matter of time. The FATF calls the shots on the timeline but I am confident that we will meet the highest international standards and be top of the class," declares Frédéric Cottalorda.
Message To Marketplace
This rationale also explains the importance placed on sanctions. The FATF’s latest expectations focus specifically on Monaco’s ability to demonstrate that violations are indeed met with sanctions that are proportionate, effective and dissuasive. Publicising sanctions by publishing the decision, including the names of the parties involved, in the Journal de Monaco and on Monaco's financial intelligence unit's (AMSF) website for five years plays a crucial role here. "Say you’re on the motorway, you break the speed limit and you get caught. Other drivers can clearly see a car pulled over on the side of the road being ticketed," illustrates Frédéric Cottalorda. A sanction serves not only to punish but also to remind everyone involved of the rules, as demonstrated by the AMSF when, on 7 May 2026, they imposed a €6 million fine on UBS Monaco for failures to comply with anti-money laundering regulations!
The EU List Question
Removal from the FATF Grey List will not solve everything immediately, however. As Frédéric Cottalorda points out, a second hurdle remains: removal from the European Union's list. Inclusion on that list automatically triggers enhanced due diligence measures by European financial institutions. In other words, even once the FATF review is successfully concluded, Monaco will still need to convince European partners that the progress made is sustainable.
Inset
Bruno Dalles: "Monaco is officially on the path to exiting the list"
"We need to demonstrate that we are committed to an irreversible process," insists Bruno Dalles. Following the FATF's decision, the head of the AMSF expressed his satisfaction, whilst urging caution against declaring victory too soon. In his view, the Principality has reached a decisive milestone: "We are now officially on the path to exiting the Grey List.” The reason is that historically, once an on-site visit is scheduled, the process generally leads to a successful outcome. "The elements already validated by the FATF will not be called into question. What has been secured remains secured. In early September, FATF experts will conduct an on-site visit to verify that the reforms initiated are being properly implemented and, above all, that they are sustainable. The visit is simply intended to confirm that efforts are continuing." If this final step is successfully completed, the final decision is expected at the FATF plenary session in Paris at the end of October. "Algeria is coming off the list, which sets a favourable precedent."
