On 13th February 2026, the global financial compliance landscape witnessed a significant shift following the conclusion of the Financial Action Task Force (FATF) Plenary held between 11th and 13th February 2026. One of the most important outcomes of this plenary session was the addition of Kuwait and Papua New Guinea to the FATF Grey List, officially referred to as the list of Jurisdictions under Increased Monitoring.
This development marks a pivotal moment not only for the countries involved but also for financial institutions, regulatory authorities, and Designated Non-Financial Businesses and Professions (DNFBPs) across the globe that rely on FATF guidance to shape their Anti-Money Laundering (AML) and Counter-Terrorist Financing (CFT) compliance frameworks.
Key Outcomes of the February 2026 FATF Plenary
The February 2026 FATF plenary resulted in the following major updates:
Addition of Kuwait and Papua New Guinea to the Grey List
The most notable change was the inclusion of:
- Kuwait
- Papua New Guinea
to the list of jurisdictions under increased monitoring.
This decision was taken after FATF identified weaknesses in their existing AML/CFT regulatory structures that require strengthening through legislative, institutional, and enforcement-level reforms.
Papua New Guinea, in particular, was reported to have gaps in areas such as:
- Money laundering and terrorist financing risk assessments
- Beneficial ownership transparency
- Cross-border transaction reporting
- Law enforcement capability and coordination mechanisms
Similarly, Kuwait’s inclusion reflects the need for more robust mechanisms in identifying and mitigating financial crime risks across financial and non-financial sectors.
Both countries have now formally committed to implementing FATF-recommended action plans to address these deficiencies within stipulated timeframes.
No Countries Removed from the Grey List
Unlike some previous plenary sessions where jurisdictions successfully exited the monitoring framework, the February 2026 update did not remove any country from the Grey List.
This indicates FATF’s continued cautious approach towards global AML/CFT compliance and highlights that several monitored jurisdictions are still in the process of fulfilling their action plans.
No Changes to the FATF Black List
The FATF Black List, which identifies High-Risk Jurisdictions subject to a Call for Action, remained unchanged following the February 2026 plenary.
Countries such as: Iran, Democratic People’s Republic of Korea (DPRK) continue to remain on this list due to significant and unresolved strategic deficiencies in combating money laundering and terrorist financing.
Myanmar also continues to be subject to enhanced due diligence measures due to ongoing risks associated with its financial systems.
Implications of Grey Listing
Being placed on the FATF Grey List can have wide-ranging economic and reputational consequences for the concerned countries. These may include:
- Reduced investor confidence
- Increased scrutiny from international financial institutions
- Delays in cross-border transactions
- Higher compliance costs for businesses
- Restrictions in correspondent banking relationships
In Papua New Guinea’s case, government officials have already acknowledged that grey-listing may affect international financial transactions and overseas remittance services if corrective measures are not implemented swiftly.
However, grey-listing also acts as an opportunity for jurisdictions to reform and modernize their financial oversight frameworks through internationally aligned best practices.
Updated FATF Grey List as of 13 February 2026
Following the latest update, the FATF Grey List now includes 22 jurisdictions under increased monitoring, including:
- Algeria
- Angola
- Bolivia
- Bulgaria
- Cameroon
- Côte d’Ivoire
- Democratic Republic of Congo
- Haiti
- Kenya
- Kuwait
- Laos
- Lebanon
- Monaco
- Namibia
- Nepal
- Papua New Guinea
- South Sudan
- Syria
- Venezuela
- Vietnam
- Virgin Islands (UK)
- Yemen
These jurisdictions are currently working in collaboration with FATF to address deficiencies in their financial crime prevention frameworks.
Compliance Measures for Reporting Entities
In light of these developments, FATF-regulated entities worldwide, including financial institutions, Virtual Asset Service Providers (VASPs), and DNFBPs are expected to reassess their internal compliance mechanisms to account for jurisdictional risk exposure arising from newly grey-listed countries.
Recommended compliance actions include:
- Conducting Enterprise-Wide Risk Assessments (EWRA)
- Updating customer risk rating methodologies
- Implementing Enhanced Due Diligence (EDD) for clients linked to grey-listed jurisdictions
- Revising AML/CFT policies and procedures
- Reconfiguring transaction monitoring systems
- Conducting employee training to ensure awareness of updated jurisdictional risks
Failure to align internal controls with FATF updates could increase exposure to financial crime risks and regulatory penalties.
The Way Forward
Placement on the FATF Grey List initiates a period of increased monitoring during which the concerned jurisdiction must demonstrate meaningful progress in implementing reforms. Once FATF determines that the action plan has been substantially fulfilled, an on-site visit is conducted to verify compliance. Successful completion of this process may result in removal from public monitoring during a subsequent plenary session.
For Kuwait and Papua New Guinea, the coming months will therefore be critical in terms of legislative amendments, inter-agency coordination, and enforcement strengthening aimed at restoring confidence in their financial systems.
The February 2026 FATF Grey List update reflects the organisation’s ongoing commitment to strengthening global safeguards against financial crime. While the inclusion of Kuwait and Papua New Guinea signals existing vulnerabilities in their AML/CFT regimes, it also represents an opportunity for these jurisdictions to implement systemic reforms in alignment with international standards.
For compliance professionals and reporting entities worldwide, staying updated with FATF developments remains essential to managing jurisdictional risks effectively and ensuring adherence to evolving regulatory expectations in an increasingly interconnected financial environment.
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