Financial Action Task Force Evaluates Turkey’s Anti-Money Laundering Efforts
In a significant move that could impact Turkey’s financial standing, a team from the Financial Action Task Force (FATF), the international body responsible for combating money laundering and terrorist financing, conducted a series of meetings with Turkish authorities. This visit is a precursor to the FATF’s upcoming report, which is expected to be pivotal for Turkey’s financial reputation on the global stage.
The unannounced “on-site” visit aimed to gauge Turkey’s improvements since being “grey-listed” by the FATF in 2021. The grey list includes countries under increased monitoring due to deficiencies in their efforts to combat money laundering and terrorist financing. The outcome of this visit is particularly crucial as it will influence the FATF’s decision at its June 28 plenary session. Finance Minister Mehmet Simsek has indicated optimism, suggesting that Turkey may soon exit the grey list.
While the specifics of the meetings and the entities involved remain undisclosed, the significance of these discussions cannot be understated. The FATF, established by the G7 to safeguard the integrity of the global financial system, had previously identified shortcomings in Turkey’s regulation of sectors prone to illicit activities. In response, Turkey has reportedly been proactive in addressing these concerns.
The implications of the FATF’s assessment are far-reaching. Being on the grey list can affect a country’s relationships with international banks and investors, as many adhere to FATF recommendations. A positive report next month could potentially fortify the Turkish lira and bolster investor confidence in Turkish assets.
Minister Simsek has been at the forefront of reversing economic policies towards more traditional approaches and has expressed confidence in Turkey’s compliance efforts. With the technical groundwork purportedly laid, all eyes are now on the forthcoming on-site inspection slated for June, which could mark a turning point for Turkey in its quest to shed the grey list designation.
