North Korea Designated High-Risk for Money Laundering and Terrorist Financing for 14th Consecutive Year

North Korea has been designated as a country with a high risk of money laundering and terrorist financing for 14 consecutive years.

According to AFP and other media on the 23rd (local time), the Financial Action Task Force (FATF) made this decision at a general meeting in Paris, France. North Korea has been classified as a high-risk country since 2011. The FATF also designated (blacklisted) Iran and Myanmar as high-risk countries, along with North Korea. North Korea and Iran are high-risk countries that require countermeasures from the member countries, while Myanmar is a high-risk country that requires enhanced due diligence in transactions, although the risk is slightly less. The FATF evaluated that North Korea has not corrected severe defects in its anti-money laundering and terrorist financing systems and poses a serious threat to the integrity of the international financial system. They also expressed serious concerns about the threat posed by North Korea’s illegal activities related to the proliferation of weapons of mass destruction (WMD) and the financing for them. As a result, all of the member countries are advised to be particularly cautious when dealing with their North Korean counterparties and to apply effective countermeasures and financial sanctions by the UN Security Council’s sanctions on North Korea. They were also urged to close all offices of North Korean financial institutions within the territories of the member countries and to sever relations with North Korean banks.

Meanwhile, the FATF removed the United Arab Emirates (UAE), Barbados, the British territory of Gibraltar, and Uganda from the gray list of monitored countries, noting that they have made significant progress in improving policies to prevent money laundering and terrorist financing.