- February 20, 2026
- Posted by: FCS Compliance
- Category: Art Market, News, Property Market
At its 11–13 February 2026 plenary, the Financial Action Task Force (FATF) added Kuwait and Papua New Guinea to its Jurisdictions under Increased Monitoring (the “grey list”) and reaffirmed Iran’s status as a High-Risk Jurisdiction subject to a Call for Action.
For UK estate agents and Art Market Participants (AMPs), these updates mean heightened country risk when dealing with clients, beneficial owners, or funds connected to these jurisdictions and a need to reassess due diligence procedures accordingly.
What Changed at the February 2026 FATF Plenary?
Following publication of its statement on 13 February 2026, FATF confirmed:
- Kuwait – Added to Jurisdictions under Increased Monitoring (Grey List)
- Papua New Guinea – Added to Jurisdictions under Increased Monitoring (Grey List)
- Iran – Remains a High-Risk Jurisdiction subject to a Call for Action
No countries were removed from the grey list during this plenary cycle.
FATF’s grey list identifies countries with strategic AML/CFT deficiencies that have committed to addressing them within agreed timeframes. While grey-listing is not a sanction, it signals elevated risk.
Why This Matters for UK Estate Agents and AMPs
UK property professionals and AMPs are required under the Money Laundering Regulations 2017 (as amended) to apply a risk-based approach to customer due diligence.
When a country is placed on the FATF grey list, it becomes a recognised higher-risk third country indicator, which may require:
- Enhanced due diligence (EDD)
- Deeper scrutiny of the source of funds and source of wealth
- Increased verification of beneficial ownership structures
- Additional documentation before proceeding with transactions
This is particularly relevant for:
- High-value property purchases involving overseas buyers
- Transactions involving trusts or complex corporate vehicles
- Art sales above €10,000 involving cross-border payments
- Intermediary or agent-led transactions
Kuwait: Implications for UK Transactions
FATF identified strategic deficiencies in Kuwait’s AML/CFT framework, including areas relating to beneficial ownership transparency, risk-based supervision, and effectiveness of enforcement.
For UK estate agents and AMPs, this means:
- Kuwaiti nationals, residents, or entities should trigger a reassessment of country risk
- Greater scrutiny may be required where funds originate from Kuwaiti financial institutions
- Complex ownership structures linked to Kuwait warrant additional verification
Given Kuwait’s position within Gulf investment flows, firms operating in Prime Central London or handling high-value art transactions may see practical impacts.
Papua New Guinea: Practical Considerations
Papua New Guinea was added due to identified weaknesses in AML/CFT supervision and implementation.
While PNG may be less common in UK property transactions, firms should consider:
- Enhanced checks where beneficial owners are resident in PNG
- Additional documentation where funds are routed through PNG
- Careful assessment of intermediaries acting on behalf of PNG-connected clients
The principle remains the same: document your risk assessment and evidence your rationale.
Click here to see the full FATF Grey List – Under Increased Monitoring
- Algeria
- Angola
- Bolivia
- Bulgaria
- Cameroon
- Côte d’Ivoire
- Democratic Republic of Congo
- Haiti
- Kenya
- Kuwait
- Lao People’s Democratic Republic
- Lebanon
- Monaco
- Namibia
- Nepal
- Papua New Guinea
- South Sudan
- Syria
- Venezuela
- Vietnam
- Virgin Islands (UK)
- Yemen
Iran: Continued High-Risk Status
FATF reaffirmed Iran’s status as a High-Risk Jurisdiction subject to a Call for Action.
For UK-regulated firms, this remains a significant red flag. Transactions involving Iranian links may already be subject to sanctions restrictions in addition to AML obligations.
Click here to see the full FATF Black List – High-Risk Jurisdictions
- Democratic People’s Republic of Korea
- Iran
- Myanmar
Frequently Asked Questions
Click on each question to reveal the answer.
Does being on the FATF Grey List mean clients from that country cannot transact in the UK?
No. Grey-listing does not prohibit transactions. It means firms must treat the country as higher risk and apply enhanced due diligence where appropriate.
Is the FATF Grey List the same as a sanctions list?
No. FATF listing relates to AML/CFT deficiencies. Sanctions are imposed separately by governments. However, high-risk jurisdictions may overlap with sanctions regimes, as in the case of Iran.
Do estate agents have to apply enhanced due diligence automatically?
Not automatically — but grey-list status is a strong risk indicator under the UK’s risk-based framework. Firms should assess whether EDD is required and document their reasoning.
How does this affect Art Market Participants?
AMPs must apply enhanced scrutiny to high-value transactions involving grey-listed jurisdictions, particularly regarding source of funds, beneficial ownership, and intermediaries.
When did the changes take effect?
The updates took effect upon publication of FATF’s public statements on 13 February 2026.
Final Takeaway
The February 2026 FATF plenary is a reminder that country risk is dynamic. For UK estate agents and AMPs, grey-list movements should prompt a measured but immediate review of internal risk assessments and enhanced due diligence procedures.
The expectation from UK supervisors is clear: stay informed, apply a proportionate risk-based approach, and maintain clear documentation.
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