Circular No. 77/2026: High-Risk Countries and Countries Under Enhanced Monitoring

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Palestine Monetary Authority
PALESTINE MONETARY AUTHORITY

Circular No. (77 / 2026)
To all banks operating in Palestine
Date: Monday, June 29, 2026

Subject: High-Risk Countries and Countries Under Enhanced Monitoring

A copy of the decision issued by the Financial Follow-Up Unit No. (2026/2) regarding High-Risk Countries and Countries Under Enhanced Monitoring according to the list issued by the Financial Action Task Force (FATF) is attached herewith. Accordingly, the necessary legal measures are requested to implement the requirements of the aforementioned decision and the measures to be taken in this regard, emphasizing the necessity to comply with the following:

1. Taking into account concerns regarding deficiencies in Anti-Money Laundering and Combating the Financing of Terrorism (AML/CFT) systems in countries classified within the "Grey List" (Countries Under Enhanced Monitoring), when conducting and updating the self-assessment of money laundering and terrorism financing risks.
2. Applying the Risk-Based Approach (RBA), such that the application of due diligence measures is proportional to (risk analysis results, nature of the financial transaction risk, customer risks, and country classification), with enhanced due diligence measures to be taken when high risks are perceived.

Supervision Group
Palestine Monetary Authority

Copy: The Honorable Financial Follow-Up Unit

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Financial Follow-Up Unit
State of Palestine

وحدة المتابعة المالية
دولة فلسطين

Decision No. (2026/2)
Issued by the Financial Follow-Up Unit
Date: 2026/06/21

Regarding lists of High-Risk Countries and Countries Under Enhanced Monitoring

Based on the provisions of Law No. (39) of 2022 regarding the combating of money laundering and terrorism financing and its amendments, particularly the provisions of Article (20) and paragraphs (3, 4) of Article (30), and based on the decision of the National Committee for Combating Money Laundering and Terrorism Financing No. (8/J/2016) issued on 2016/12/01 regarding the delegation to the Financial Follow-Up Unit to publish the list of high-risk countries issued periodically by the Financial Action Task Force (FATF), and subsequently what was decided by the Group since 2020/02/21, until 2026/06/19, and in addition to the decision of the National Committee for Combating Money Laundering and Terrorism Financing No. (T/2020/5) issued on 2020/02/24 regarding High-Risk Countries and Countries Under Enhanced Monitoring, and subsequently to the Financial Follow-Up Unit Decision No. (2020/1) dated 2020/02/25 and subsequent decisions regarding lists of High-Risk Countries and Countries Under Enhanced Monitoring.

Based on the requirements of public interest, it is decided as follows:

First
List of High-Risk Countries (Black List)
All financial institutions and specified non-financial businesses and professions in the State of Palestine must continue to apply the following procedures towards high-risk countries:

Country	Required Procedures Towards Countries
Democratic People's Republic of Korea (North Korea).	1. Apply targeted financial sanctions in accordance with the provisions of Executive Decree No. (2022/14) regarding the implementation of Security Council decisions.
Islamic Republic of Iran (Iran).	2. Pay special attention to commercial relations and transactions with those countries, including companies and financial institutions, and apply the following countermeasures: <br> a. Apply enhanced due diligence measures on business relations and transactions with those countries (as part of countermeasures), and in proportion to the risks arising therein, according to the details of Articles (26, 27) of National Committee Instructions No. (4) of 2022 regarding Financial Institutions, and Articles (24, 25) of National Committee Instructions No. (3) of 2022 regarding Specified Non-Financial Businesses and Professions.

b. Apply the enhanced due diligence measures referred to in paragraph (a) of this item when dealing with any entity acting on behalf of a natural or legal person, including companies or financial institutions operating in those countries.
c. Enhance the reporting mechanisms adopted by the financial institution or one of the specified non-financial businesses and professions, including increasing cooperation between employees and promptly providing data to the Anti-Money Laundering and Combating the Financing of Terrorism Officer within the financial institution or one of the specified non-financial businesses and professions, to ensure that no transaction suspected of involving money laundering or one of the predicate crimes associated with it or terrorism financing is executed, and to report this suspicion to the Unit immediately and without delay, providing it with all data related to the attempt to conclude those transactions, while ensuring the confidentiality of the report and not notifying the customer.
d. Do not establish branches, representative offices, or subsidiaries in those countries. e. Do not rely on third parties located in those countries to take any due diligence measures towards customers. f. Do not establish any banking correspondent relationships or similar correspondent relationships with financial institutions in those countries.

| Union of Myanmar (Myanmar). | 1. Apply enhanced due diligence measures on business relations and transactions with Myanmar, and in proportion to the risks arising in the country, according to the details of Articles (26, 27) of National Committee Instructions No. (4) of 2022 regarding Financial Institutions, and Articles (25, 24) of National Committee Instructions No. (3) of 2022 regarding Specified Non-Financial Businesses and Professions. <br> 2. When applying enhanced due diligence measures, it must be ensured that the flow of funds for humanitarian assistance and legitimate non-profit organization activities and financial transfers is not disrupted, especially regarding earthquake relief efforts in Myanmar. |

Second
List of Countries Under Enhanced Monitoring (Grey List) Amend the list of Countries Under Enhanced Monitoring (Grey List) stipulated in the Unit's Decision No. (2026/1) by adding (Bosnia and Herzegovina, and Iraq) and removing (Algeria, and the Republic of Namibia), so that the list becomes as in the table below, and taking into account concerns regarding deficiencies in their Anti-Money Laundering and Combating the Financing of Terrorism (AML/CFT) systems (according to the attachment to this decision) when conducting the self-assessment of money laundering and terrorism financing risks, including identifying, analyzing, and evaluating those risks.

Number	Country Name	Number	Country Name
1	Angola	12	Lao People's Democratic Republic (Laos)
2	Bolivia	13	Republic of Lebanon
3	Bosnia and Herzegovina	14	Monaco
4	Bulgaria	15	Federal Democratic Republic of Nepal (Nepal)
5	Cameroon	16	Papua New Guinea
6	Côte d'Ivoire (Ivory Coast)	17	Republic of South Sudan
7	Democratic Republic of the Congo	18	Syrian Arab Republic (Syria)
8	Republic of Haiti	19	Venezuela
9	Iraq	20	Vietnam
10	Republic of Kenya	21	Virgin Islands (United Kingdom)
11	State of Kuwait	22	Republic of Yemen (Yemen)

Third
Implementation
All financial institutions and specified non-financial businesses and professions must implement the provisions of this decision, and it shall be effective from the date of its circular.

Director of the Financial Follow-Up Unit
Dr. Firas Marar
[Signature]

Attachment: Concerns Regarding Deficiencies in Anti-Money Laundering and Combating the Financing of Terrorism Systems.

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Concerns Regarding Deficiencies in Anti-Money Laundering and Combating the Financing of Terrorism Systems

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Attached to Financial Follow-Up Unit Decision No. (2026/2) Regarding lists of High-Risk Countries and Countries Under Enhanced Monitoring

Concerns Regarding Deficiencies in Anti-Money Laundering and Combating the Financing of Terrorism Systems in Countries

• Part One: Deficiencies through Assessment Reports (for all countries):
  This section explains how to access concerns regarding the Anti-Money Laundering and Combating the Financing of Terrorism (AML/CFT) and Combating the Financing of Proliferation (CFP) systems of countries listed on the Grey List, as well as all other countries undergoing mutual evaluation by the FATF or peer groups. Those concerns can be accessed by reviewing the mutual evaluation reports related to those countries and the follow-up reports for this report.

Mutual evaluation reports and follow-up reports published on the FATF website or the FATF Middle East and North Africa Regional Body (MENAFATF) website contain all deficiencies and key conclusions regarding the AML/CFT systems in countries listed on the Enhanced Monitoring List and all other countries that have undergone evaluation. Those can be obtained according to the following mechanism:

a. Accessing mutual evaluation reports in English (for all countries).

1. Enter the website: www.fatf-gafi.org
2. From the Topics menu, select (Mutual Evaluations).
3. Select (Mutual Evaluations Reports).
4. Search for the country name in English in the search window shown in the image on the side.

b. Accessing mutual evaluation reports in Arabic (for countries subject to evaluation by the FATF Middle East and North Africa Regional Body).

1. Enter the website: www.menafatf.org/ar
2. Select the item (Mutual Evaluation) then (Evaluation Reports - Second Round of Evaluation), or follow-up reports.
3. Select the report from the list that appears according to the country name.

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Attached to Financial Follow-Up Unit Decision No. (2026/2) Regarding lists of High-Risk Countries and Countries Under Enhanced Monitoring

• Part Two: Implementation of Action Plans to Address Deficiencies
  Countries listed on the Grey List have made a high-level political commitment to address strategic deficiencies in their Anti-Money Laundering and Combating the Financing of Terrorism (AML/CFT) systems, and those countries are still implementing their commitments to address remaining deficiencies.

The items below outline the key pillars that those countries are working to address or have addressed, which depend on the specific deficiencies identified according to mutual evaluation reports and follow-up reports, which must be taken into account whether negative or positive:

Country	Key Pillars
Angola	Since October 2024, when Angola made a high-level political commitment to work with the FATF and ESAAMLG to strengthen the effectiveness of its AML/CFT regime, Angola has taken steps to improve its AML/CFT regime by enhancing its understanding of ML/TF risks. Angola should continue to work with the FATF to implement its FATF action plan by: (1) improving risk-based supervision of non-financial banking entities and DNFBPs; (2) ensuring competent authorities have adequate, accurate and timely access to beneficial ownership information and that breaches to obligations are adequately addressed; (3) demonstrating an increase in ML investigations and prosecutions; (4) demonstrating the ability to identify, investigate and prosecute TF; and (5) demonstrating an effective process to implement targeted financial sanctions without delay.
Bolivia	Since June 2025, when Bolivia made a high-level political commitment to work with the FATF and GAFILAT to strengthen the effectiveness of its AML/CFT regime, Bolivia has taken steps to improve its AML/CFT regime. Bolivia should continue working to implement its FATF action plan by: (1) ensuring relevant special investigative techniques can be used in ML investigations; (2) implementing risk-based supervision of real estate agents, lawyers, accountants and DPMS; (3) ensuring that breaches to beneficial ownership obligations are sanctioned; and (4) increasing ML investigations and prosecutions in line with the country's risks (including other high-risk predicates in addition to corruption and drug trafficking).
Bosnia and Herzegovina	In June 2026, Bosnia and Herzegovina made a high-level political commitment to work with the FATF and MONEYVAL to strengthen the effectiveness of its AML/CFT regime. Since the adoption of its MER in December 2024, Bosnia and Herzegovina has made progress on its MER's recommended actions, including through developing an overarching AML/CFT strategy, developing guidance for FIs and DNFBPs on AML/CFT obligations, and improving the sharing and use of financial intelligence. Bosnia and Herzegovina will continue to work with the FATF to implement its FATF action plan by (1) further deepening its understanding of ML/TF risks, (2) adopting policies to systematically make use of international cooperation, (3) strengthening notary supervisors' understanding of ML/TF risks, ensuring consistent AML/CFT supervision of DNFBPs and imposing proportionate, dissuasive and effective sanctions on the banking sector, (4) ensuring that there is timely availability of accurate and up-to-date basic and beneficial ownership information, (5) providing targeted feedback on the quality of STRS, (6)

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Attached to Financial Follow-Up Unit Decision No. (2026/2) Regarding lists of High-Risk Countries and Countries Under Enhanced Monitoring

	demonstrating an increase in investigations and prosecutions of ML, (7) demonstrating that effective, proportionate and dissuasive sanctions are being applied for breaches of specific crossborder cash declaration regimes, (8) demonstrating it is proactively pursuing TF cases and clarifying the interpretation of the TF offence and (9) ensuring its supervisors can apply the full range of effective, proportionate and dissuasive sanctions for breaches of PF and TF TFS obligations.
Bulgaria	In October 2023, Bulgaria made a high-level political commitment to work with the FATF and MONEYVAL to strengthen the effectiveness of its AML/CFT regime. At its June 2026 Plenary, the FATF made the initial determination that Bulgaria has substantially completed its action plan and warrants an on-site assessment to verify that the implementation of AML/CFT reforms has begun and is being sustained, and that the necessary political commitment remains in place to sustain implementation in the future. Bulgaria has made the following reforms: (1) implementing its national AML/CFT Strategy through adopting a comprehensive action plan; (2) addressing remaining technical compliance deficiencies; (3) demonstrating initial implementation of risk-based supervision for postal money operators, currency exchange providers and real estate agents and establishing market entry controls for VASPs and postal money operators; (4) ensuring that the beneficial ownership information held in the Register is accurate and up-to-date; (5) completing the implementation of the automated system to ensure more automated prioritisation of STRS; (6) improving investigations and prosecutions of different types of money laundering in line with risks, including high-scale corruption and organised crime; (7) ensuring that confiscation is pursued as a policy objective; (8) ensuring the ability to conduct parallel financial investigations in all terrorism investigations; (9) addressing gaps in the TF and PF targeted financial sanctions (TFS) frameworks; and (10) identifying the subset of NPOs most vulnerable to TF abuse and demonstrating initial implementation of risk-based monitoring to prevent abuse for TF purposes.
Cameroon	Since June 2023, when Cameroon made a high-level political commitment to work with the FATF and GABAC to strengthen the effectiveness of its AML/CFT regime, Cameroon has taken steps to improve its AML/CFT regime by demonstrating an increase in dissemination of intelligence reports to support operational needs of competent authorities and prioritising seizure and confiscation of assets at the border. Cameroon should continue working on implementing its FATF action plan to address its strategic deficiencies, including by: (1) enhancing risk-based supervision of banks and implementing effective risk-based supervision for non-bank FIs and DNFBPs, and conducting appropriate outreach to high-risk FIs and DNFBPs; (2) enhancing secure information exchange between the FIU, reporting entities and competent authorities; (3) implementing policies and procedures for seizing and confiscating proceeds and instrumentalities of crime and managing frozen, seized and confiscated property; (4) demonstrating effective implementation of TF and PF TFS regimes and implementing a risk-based approach to NPOs without disrupting legitimate NPO activities. The FATF notes Cameroon continued progress across its action plan, however all deadlines have now expired and work remains. The FATF encourages Cameroon

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Attached to Financial Follow-Up Unit Decision No. (2026/2) Regarding lists of High-Risk Countries and Countries Under Enhanced Monitoring

	to continue to implement its action plan to address the above-mentioned strategic deficiencies as soon as possible.
Côte d'Ivoire	In October 2024, Côte d'Ivoire made a high-level political commitment to work with the FATF and GIABA to strengthen the effectiveness of its AML/CFT regime. At its June 2026 Plenary, the FATF made the initial determination that Côte d'Ivoire has substantially completed its action plan and warrants an on-site assessment to verify that the implementation of AML/CFT reforms has begun and is being sustained, and that the necessary political commitment remains in place to sustain implementation in the future. Côte d'Ivoire has made the following reforms: (1) enhancing its use of international cooperation in ML/TF investigations and prosecutions; (2) improving the implementation of risk-based supervision of financial institutions and designated non-financial businesses and professions and conducting outreach campaigns to improve compliance; (3) improving the verification and access of basic and beneficial ownership information of legal persons and applying sanctions in case of violation; (4) enhancing the use of financial intelligence by law enforcement authorities and improving disseminations by the FIU; (5) demonstrating a sustained increase in the number of ML and TF investigations and prosecutions of different types in line with the country's risk profile; and (6) strengthening the targeted financial sanctions framework.
DEMOCRATIC REPUBLIC OF THE CONGO	In October 2022, the DRC made a high-level political commitment to work with the FATF and GABAC to strengthen the effectiveness of its AML/CFT regime. At its June 2026 Plenary, the FATF made the initial determination that the DRC has substantially completed its action plan and warrants an on-site assessment to verify that the implementation of AML/CFT reforms has begun and is being sustained, and that the necessary political commitment remains in place to sustain implementation in the future. DRC has made the following reforms: (1) finalising the NRA on ML and TF and adopting an AML/CFT national strategy; (2) designating supervisory authorities for all DNFBP sectors, and developing and implementing a risk-based supervision plan; (3) adequately resourcing the FIU, and build its capacity to conduct operational and strategic analysis; (4) strengthening the capabilities of authorities involved in the investigation and prosecution of ML and TF; and (5) demonstrating effective implementation of TF and PF-related TFS. Given the current public health situation in the DRC, the FATF will monitor developments to ensure any on-site assessment can take place under safe conditions.
Haiti	Since June 2021, when Haiti made a high-level political commitment to work with the FATF and CFATF to strengthen the effectiveness of its AML/CFT regime, Haiti has taken steps towards improving its AML/CFT regime, including by completing its ML/TF risk assessment process and disseminating the findings. The FATF recognises the political commitment expressed at a high level and the efforts demonstrated by Haiti to advance its commitment in the midst of the challenging social, economic and security situation within the country. Haiti should continue

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Attached to Financial Follow-Up Unit Decision No. (2026/2) Regarding lists of High-Risk Countries and Countries Under Enhanced Monitoring

to work on implementing its action plan to address its strategic deficiencies, including by: (1) implementing risk-based AML/CFT supervision for DNFBPs deemed to constitute a higher ML/TF risk; (2) ensuring basic and beneficial ownership information are maintained and accessible in a timely manner; (3) demonstrating authorities are identifying, investigating and prosecuting ML cases in a manner consistent with Haiti's risk profile; (4) demonstrating an increase of identification, tracing and recovery of proceeds of crimes; (5) addressing the technical deficiencies in its targeted financial sanctions regime; and (6) conducting appropriate risk-based monitoring of NPOs vulnerable to TF abuse without disrupting or discouraging legitimate NPO activities. The FATF notes Haiti's continued progress across its action plan, however all deadlines have now expired and work remains. The FATF encourages Haiti to continue to implement its action plan to address the above-mentioned strategic deficiencies.

Iraq

In June 2026, Iraq made a high-level political commitment to work with the FATF and MENAFATF to strengthen the effectiveness of its AML/CFT regime. Since the adoption of its MER in November 2024, Iraq has made progress on its MER's recommended actions, including through applying market entry controls to prevent criminals and terrorists from accessing important sectors, providing guidance and outreach to non-banking financial institutions and DNFBPs, introducing measures to mitigate the risks in the real estate sector, and enhancing authorities' understanding of how legal persons are misused for ML/TF. Iraq will continue to work with the FATF to implement its FATF action plan by (1) enhancing its understanding of specific ML/TF risks and adopting appropriate riskbased preventive measures, (2) enhancing the detection of informal money or value transfer services, establishing a legislative framework for VSAPs and applying effective, proportionate and dissuasive sanctions for breaches of AML/CFT requirements, (3) ensuring FIs and DNFBP apply TFS and PEP measures (4) increasing the quantity and quality of STRS with a focus on high-risk sectors and demonstrating an increase use of financial information particularly related to DNFBPs, (5) enhancing risk-based implementation of beneficial ownership measures, (6) pursuing more ML investigations and prosecutions of ML and reviewing sentencing in ML cases, (7) pursuing more TF investigations and prosecutions in relation to specific TF risks and addressing the technical compliance issues in relation to its TF offence, (8) developing a robust understanding of the NPO sector and the TF risks affecting NPOs and implementing risk-based measures while avoiding undue disruption or other

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Attached to Financial Follow-Up Unit Decision No. (2026/2) Regarding lists of High-Risk Countries and Countries Under Enhanced Monitoring

	unintended consequences for legitimate NPO activities and (9) enhancing its ability to identify and combat PF TFS evasion.
Kenya	Since February 2024, when Kenya made a high-level political commitment to work with the FATF and ESAAMLG to strengthen the effectiveness of its AML/CFT regime, Kenya has taken steps towards improving its AML/CFT regime, including by increasing FIs and DNFBPs understanding of TFS. Kenya should continue to work to implement its FATF action plan to address its strategic deficiencies, including by: (1) improving risk-based AML/CFT supervision of FIs and DNFBPs; (2) enhancing the understanding of preventive measures by FIs and DNFBPs, including to increase STR filing; (3) designating an authority for the regulation of trusts and collection of accurate and up-to-date beneficial ownership information and implementing remedial actions for breaches of compliance with transparency requirements for legal persons and arrangements; (4) improving the use and quality of financial intelligence products; (5) increasing ML investigations and prosecutions in line with risks; (6) bringing the TFS framework in compliance with R.6 and ensure its effective implementation; and (7) revising the framework for NPO regulation and oversight to ensure that mitigating measures are risk-based and do not disrupt or discourage legitimate NPO activity.
Kuwait	Statement from February 2026 <br> In February 2026, Kuwait made a high-level political commitment to work with the FATF and MENAFATF to strengthen the effectiveness of its AML/CFT regime. Since the adoption of its MER in June 2024, Kuwait has made significant progress on the vast majority of its MER's recommended actions, including adopting a new national AML/CFT/CPF strategy, further improving its technical compliance framework for TF and PF targeted financial sanctions, further enhancing its understanding of ML and TF risks and conducting risk-based outreach and supervision of financial institutions and DNFBPs. Kuwait will continue to work with the FATF to implement its FATF action plan by: (1) enhancing outreach to real estate agents and DPMSs on STR reporting, including through distribution of sector-based indicators of ML/TF; (2) ensuring that beneficial ownership information in the registry is accurate, and applying effective, proportionate and dissuasive sanctions in cases of inaccurate information where appropriate; (3) increasing ML investigations and prosecutions in relation to cross-border movements of currency and BNIs.
LAO PDR	In February 2025, Lao PDR made a high-level political commitment to work with the FATF

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