Monte Carlo is removed from the ‘grey list’ for money laundering

The Principality of Monaco has officially been removed from the grey list for international money laundering. The Financial Action Task Force (FATF), in announcing the decision, stated that Monaco had made sufficient progress in addressing the shortcomings in its anti-money laundering system, thereby justifying its removal from the so-called grey list. The Principality had been placed under enhanced monitoring in June 2024.

At the same time, the FATF announced yesterday that Bulgaria, the Democratic Republic of the Congo and Côte d’Ivoire had been removed from the grey list.

For Monaco, the decision represents a significant victory following the harsh criticism it received, just two years ago, for its outdated system for reporting suspicious financial transactions and for the lack of a targeted strategy to combat money laundering.

The Principality has historically been a magnet for the world’s super-rich, famous sports stars and others, drawn by the regime of total exemption from income tax, and under the reign of Prince Albert II it has also earned a reputation as a haunt for wealthy Russians. Although it is difficult to assess the economic consequences of being placed on the grey list, according to Minister of State Christophe Mirmand, as reported by Bloomberg, there has been a slowdown in money transfers and investment transactions; now, however, its removal from the grey list paves the way for the development of new financial activities. Being on the grey list ‘contrasted with the image Monaco wishes to project and could have been perceived negatively’, added Mirmand. “There is often a superficial, inaccurate and disparaging view of the Principality and the nature of its economic activity.”

To address the shortcomings highlighted by the FATF, Monaco has enacted legislation, tightened customer identification requirements, stepped up cooperation with neighbouring countries and established a body to monitor money laundering money laundering.