FinCEN adds two countries to list of jurisdictions it’s monitoring for illicit financial activities

Remember that universal lesson from your childhood days: You are the company you keep. And officials at FinCEN added two more to the list of countries in which financial institutions should practice extra caution.

FinCEN’s Financial Action Task Force (FATF) added two countries, Laos and Nepal, to its list of “jurisdictions with strategic…deficiencies” in countering money laundering, terrorism financing, and the financing of proliferation of weapons of mass destruction, according to a news release. The task force also removed the Philippines from its list.

More specifically, the two nations are now on FATF’s list of “jurisdictions under increasing monitoring.” Its other list, called “high-risk jurisdictions subject to a call for action,” remains the same, FinCEN noted. That second list includes the countries of Iran, North Korea, and Myanmar.

The FATF is a global organization that sets international anti-money laundering and anti-terrorist financing standards. Since its founding in 1989, the task force has issued 40 recommendations on money laundering and nine recommendations to fight the financing of terrorism, according to FinCEN.

In the release, FinCEN reminded financial institutions doing business in countries falling under its increased-monitoring list “to comply with the due diligence obligations” as outlined by statutes.

Organizations’ due diligence procedures should be able to pick up and report on suspected malfeasance that any US-based company is doing for a foreign financial institution, according to the release. Money services businesses must also have controls in place “commensurate with the risk” of these activities that foreign “agents” or “counterparties” may be committing.