FATF targets crypto hubs in review of money laundering controls

The Financial Action Task Force is turning its attention to the places where crypto actually lives. The global anti-money laundering watchdog has launched a targeted review of jurisdictions with significant virtual asset activity, with the aim of closing the gap between the rules it wrote years ago and how governments actually enforce them.

Review Process

The review was agreed at the FATF plenary held October 28 to 30, 2026, in Paris, marking the first plenary under the UK presidency. The process zeroes in on jurisdictions with major activity involving virtual asset service providers (VASPs), which covers businesses like exchanges and custodians that handle customer crypto.

The goal is to speed up implementation of FATF standards under Recommendation 15, which covers new technologies including virtual assets. Initial findings are expected in June 2027, with further results scheduled for October 2027.

Compliance Status

As of April 2026, the FATF had assessed 149 jurisdictions on its VASP standards, finding 33 non-compliant and 64 partially compliant. While 83% of surveyed jurisdictions had implemented Travel Rule legislation by July 2026, significant gaps remain in risk-based supervision and enforcement of VASP licensing requirements.

The FATF has highlighted emerging threats including industrial-scale fraud linked to virtual assets and the misuse of stablecoins, with criminal networks increasingly exploiting regulatory weak spots in jurisdictions with lax compliance.

Grey List Impact

The FATF does not write laws but uses peer pressure and its lists, most notably the grey list (jurisdictions under increased monitoring). At the October 2026 plenary, four countries were removed from this list: Bulgaria, Côte d'Ivoire, the Democratic Republic of the Congo, and Monaco, leaving 18 jurisdictions under increased monitoring.

The watchdog plans to offer technical assistance and support to help jurisdictions shore up their frameworks and compliance capacity, not just grade them, as it focuses on key hubs that together cover approximately 97% of the global virtual asset market.