Time for an action plan and assurance

Monaco is stepping up its efforts to be removed from the FATF grey list after the country made significant progress in the fight against money laundering and terrorist financing, recognized by the organization.

Last Wednesday, the Monegasque Coordination and Monitoring Committee for the National Strategy to Combat Money Laundering, Terrorist Financing, Proliferation of Weapons of Mass Destruction and Corruption met to discuss the action plan recommended by the Financial Action Task Force (FATF).

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This meeting follows the announcement on June 28, 2024 that Monaco has been placed on the grey list of “enhanced monitoring” of the FATF, the international organization fighting money laundering and terrorist financing. In its press release, it called on the Principality to make efforts, particularly with regard to money laundering and tax fraud abroad, the seizure of assets acquired abroad from crime, the level of resources allocated to judges, the application of effective and dissuasive sanctions and the increased seizure of assets suspected of originating from criminal activities.

The government has called a press conference on July 1 to address the concerns of the various stakeholders. Here are three key points of this complex situation.

1. Progress recognised by the FATF

The FATF statement highlights a number of “significant progress” Monaco has made significant progress, particularly in strengthening its resources to combat terrorist financing, creating a new financial oversight and intelligence agency, introducing targeted financial sanctions and supervising non-profit organisations on the basis of a risk assessment.

At the press conference, Pierre-André Chiappori, Minister of Finance and Economy, “very rare” And ” unusually favorable situation” because in six years, out of about forty countries, only two countries were praised for their progress. According to him, 80% of the deficiencies identified by Moneyval had been resolved before the FATF meeting in Singapore.

2. Removed from the list in January 2026 thanks to the FATF Action Plan

The Prince’s government aims to be removed from the grey list by January 2026, with a timetable that includes two interim targets in May and September 2025, as agreed in Singapore. “We will do everything we can in the next 18 months to end this,” said the minister.

Monaco had already adopted nine new laws in recent months, including five in November alone. However, this was not enough to avoid being included on the grey list and the Principality has committed to implementing the action plan recommended by the FATF to improve its legal framework. Pierre-André Chiappori explained: “The press release states that our methodology for assessing the risks of money laundering and tax fraud is inadequate. There are still technical aspects that need to be changed.”

3. No immediate impact on the budget

The biggest fear of local stakeholders is the budgetary impact. Chiappori is trying to reassure people, as he sees no immediate consequences. “Monaco is a country that does not take out loans. Although there could be medium-term effects (…) Concerns would only arise if we remained on the grey list for five years. However, over a shorter period, say one and a half years, being on the grey list has virtually no impact,” he explained.

“Increased surveillance is not a unique phenomenon,” said the minister, referring to the example of other neighbouring countries and in the European Union, such as Croatia and Bulgaria, which are also on the grey list.

Despite this challenge, the Monegasque authorities are convinced that the Principality will emerge stronger from the situation. Minister of State Pierre Dartout put it this way: “The economic fundamentals are solid” and Monaco “has a solid economic model and remains a very attractive area.”