In a decision stirring sharp criticism, the Financial Action Task Force (FATF) has opted not to place Russia on its high-risk blacklist, even as Moscow deepens its ties with sanctioned states North Korea and Iran. Despite intense lobbying by Ukraine, which has supplied the FATF with evidence of Russia’s growing alliances with blacklisted regimes, the anti-money laundering watchdog concluded its recent Paris meeting without escalating sanctions on Russia.
The FATF, the global standard-bearer for combatting illicit financial flows, suspended Russia’s membership in 2023 but stopped short of marking it as a “high-risk country” during its October meeting, citing the need for full consensus from its 40 member nations. Some nations, including South Africa and Brazil, remained sympathetic to Russia, hindering the push for stronger action. For Ukraine, the FATF’s restraint falls short, especially as it has warned repeatedly that Moscow’s partnerships with Pyongyang and Tehran are a direct threat to global financial stability.
Ukrainian officials underscored the urgency of a blacklist, accusing Russia of exploiting relationships with North Korea and Iran to circumvent sanctions. North Korea has reportedly supplied Russia with missiles and personnel in exchange for oil, and Iran continues to support Moscow’s war efforts with ballistic missiles. Ukraine’s Finance Minister Serhii Marchenko criticized FATF’s inaction, warning, “Failing to challenge Russia’s defiance would weaken the foundations and future stability of the global financial system.”
In addition to its sanctioned-state allies, Russia is alleged to be involved in global cybercrime, financing private military groups like the Wagner Group, and laundering profits from resources seized in Ukraine. Tom Keatinge, a finance and security expert at the Royal United Services Institute, remarked that FATF’s decision signifies a reluctance to lead on curtailing Russia’s financial influence. “This should have been a slam dunk,” Keatinge observed, urging Western nations to adopt more robust sanctions independent of FATF’s limitations.
Analysts argue that with mounting evidence of Russia’s sanctions evasion, the FATF’s refusal to blacklist Moscow not only undermines its credibility but also signals a critical gap in coordinated international action. For many, FATF’s move signals a troubling normalization of Russia’s financial maneuvers, with global stability at stake.
