Lists: Monaco Under Scrutiny

The Principality's inclusion on the FATF grey list and then on the European list of high-risk third countries came as a thunderbolt. While the authorities highlight the progress made, "exit" has become a central issue for competitiveness.

When will the Principality be removed from the FATF grey list? The clock is ticking. Placed on the Financial Action Task Force (FATF) grey list since 2024 and then added to the European Union's list of high-risk third countries, the Principality is advancing under enhanced monitoring, at a time when timing is crucial. Beyond the acknowledged technical progress, remaining on these lists for too long carries economic, financial, and reputational risks that the authorities are now seeking to contain.

The latest FATF follow-up report, adopted at the plenary assembly held in Mexico in February 2026, has kept Monaco in this waiting situation. While the international organisation acknowledges Monaco's progress, "notably in terms of the quality and timeliness of suspicious activity reports sent to the AMSF" (Monaco Autorité Monégasque de Surveillance Financière), there is no question of exiting enhanced monitoring for the time being. The next window of opportunity will therefore be at the next FATF plenary meeting in October 2026 or in 2027… The government is therefore no longer talking about an exit timetable and prefers to capitalise on the FATF's recognition of "the effectiveness of the measures implemented and the ramping up of risk-based detection and processing systems". "In line with FATF expectations, the Principality is continuing the actions undertaken to date in terms of control and supervision. Strengthening the criminal justice chain is a central focus of this new phase, particularly through the specialised financial section of the Public Prosecutor's Office and the recruitment of two additional prosecutors, in order to ensure a response that is both proportionate, credible and dissuasive, on both administrative and criminal levels," notes the Executive in a press release. It then goes on to demonstrate the sustainability of its commitments: "In this context, Monaco will remain fully mobilised in 2026 (…). The Principality's actions form part of a multi-year approach, with preparations for the next National Risk Assessment in 2026–2027, to be followed by the next National Strategy. This long-term planning is an essential lever for sustainably consolidating achievements and strengthening the resilience of the system." This is why the government has announced that it will submit "a new progress report on the remaining action plan objectives".

And the EU list?

The way out of the European high-risk countries list will depend on the FATF's verdict. The European Union has no independent criteria and bases itself on FATF decisions. In theory, inclusion and removal should therefore be automatic. But how long will it take? "Between entry or exit from the FATF grey list and the update of the European list, it has sometimes taken 18 months," recalls Bruno Dalles, aware of the political dimension of the issue. An unprecedented situation that raises fears of a new delay at the exit. In other words, even if cleared by the FATF, Monaco could remain on the European list for many additional months.

Yet time is far from neutral. While impacts have so far been contained, as the various experts interviewed confirm, the longer a jurisdiction remains on these lists, the more economic effects crystallise. The primary risk is banking. De-risking policies lead some foreign institutions to reduce or even sever relations with counterparts in listed countries. This is compounded by longer processing times, enhanced checks and higher compliance costs for businesses.

There is also a reputational risk. "The difficulty for Monaco is combating a long-standing, relatively negative image, exacerbated by this listing," acknowledges the AMSF Director; an image that, in the long term, could weigh on the attractiveness of the financial centre, particularly for international investors.
Finally, there is a macroeconomic risk.  In an analysis, the Phoenix consulting firm warned of the systemic effects of a prolonged listing: a slowdown in financial flows; the weakening of certain sectors dependent on international trade; and a gradual loss of competitiveness.
Faced with these challenges, authorities intend to demonstrate that firmness is not just for show and recent events provide a concrete illustration of this.  At the end of December 2025, the AMSF imposed an €800,000 fine on Landmark, a company with approximately €4 million in annual revenue, for failing to meet its anti-money laundering obligations.  This significant, deliberate decision is part of a strategy to bolster the credibility of Monaco's anti-money laundering system.  It also aims to send a clear message to international assessors: the rules are being applied and the sanctions are being enforced.

Whistleblowers soon to be protected
Another positive signal: the draft law on the protection of whistleblowers is expected to be passed in 2026.  The legislation aims to provide legal protection for individuals who, in good faith, report facts that may constitute serious offences, in line with European and international standards.  The stakes are high.  One of the classic money laundering cases in Monaco, that of Pasche Bank (since sold), which is still under investigation, originated from the reporting of fraudulent transactions by three whistleblowers.  These bank executives were dismissed after alerting their management, and then authorities, to major malfunctions.  Their report triggered an investigation for money laundering and breaches of due diligence obligations, highlighting internal flaws in the handling of high-risk clients.

 

By Milena Radoman - Monaco Economie