On October 30, 2026, at the close of its plenary meeting, the Financial Action Task Force removed four countries from the FATF grey list, its list of jurisdictions under increased monitoring. They were Bulgaria, Côte d'Ivoire, the Democratic Republic of the Congo and Monaco. FinCEN relayed the decision the same day in a news release to U.S. financial institutions, and named no new additions. The update reads like a matter for bank compliance teams. Yet it reaches any U.S. real estate sponsor raising equity from investors abroad, because the grey list shapes how banks treat money from each country.
The point for a sponsor is that the grey list is a signal to check, not a rule that decides. It carries no legal prohibition of its own. Even so, the institutions that hold a deal's accounts read it when deciding how closely to review an investor's wire. A sponsor that maps investor countries against the FATF lists and sanctions rules early avoids finding a problem at the funding deadline. Our guide to Regulation S offerings covers the offering rules for investors outside the United States; this article covers the money laundering checks that sit alongside them.
What the FATF Grey List Is and What It Is Not
The FATF is an intergovernmental body that sets standards against money laundering and terrorist financing. It publishes two lists, issued three times a year. The first is the call for action list, often called the black list. The second is the grey list. In its February 2024 plenary outcomes, the FATF described grey list jurisdictions as actively working with it to address strategic deficiencies. Each is committed to an action plan to resolve them within agreed timeframes.
That wording matters, because a grey listed country is cooperating, not cut off. The FATF does not ask the world to stop dealing with these jurisdictions. Instead, it flags that their supervision has gaps, which tells a bank to look harder at money from there. A sponsor should read a grey list entry as a reason for more documents and more time, not as a reason to turn an investor away.
Why the October 2026 Plenary Matters to Sponsors
The black list did not change in October. Iran and North Korea remain subject to a call for countermeasures, according to FinCEN's October 30 release. Burma remains subject to enhanced due diligence but not countermeasures. The four removals are the news, and removals cut both ways for a sponsor's file.
FinCEN told U.S. financial institutions to consider the FATF's stance when reviewing their policies, procedures and practices. For grey listed jurisdictions, it pointed them to existing due diligence duties, which call for controls based on risk and, where necessary, enhanced controls. For the four delisted countries, it said institutions should take the decisions and the reasons behind them into account when assessing risk. In practice, a bank may relax its treatment of a Monaco or Bulgaria wire over time, but it is unlikely to drop its checks overnight.
The UAE shows how long the effect can last. The FATF removed the United Arab Emirates from increased monitoring at its February 2024 plenary. Sponsors raising from Gulf investors still meet banks that ask detailed source of funds questions. A delisting changes the starting point of a review rather than ending it.
Who Carries the AML Obligation in a Real Estate Raise
In most raises, the sponsor is not the party with a formal anti money laundering program rule today. FinCEN delayed its rule for registered investment advisers and exempt reporting advisers. The Federal Register notice of January 2, 2026 moved its date to January 1, 2028. A sponsor that is not a bank, broker dealer or covered adviser therefore relies on the programs around it. It still decides whom it admits to the deal.
Those institutions are the bank that holds the subscription account, any broker dealer acting as placement agent, and the fund administrator if one onboards investors. Each runs its own screening, and each reads the FATF lists. For an investor from a grey listed country, the bank may ask for a source of wealth explanation, certified identity documents or a reference from the investor's own bank. Our article on KYC for real estate syndication investors covers what that file usually holds.
Sanctions are different, and a sponsor should never treat them as part of the same scale. OFAC sanctions are law for U.S. persons, and the OFAC 50 Percent Rule treats an entity owned 50 percent or more in the aggregate by blocked persons as blocked itself. An investor entity from a country on no FATF list can still be blocked. An investor from a grey listed country can be entirely permitted. Both checks run, and neither replaces the other.
How the FATF Grey List Changes the Onboarding Timeline
The practical cost of a grey list entry is time. Enhanced review adds requests for documents, and each request adds days between a signed subscription agreement and cleared funds. For a sponsor with a fixed closing date, that delay is a real risk. A wire held for review can leave an equity gap when the lender expects the full raise.
The order of the work is the remedy. Country risk belongs at the start of the investor conversation, alongside eligibility under Regulation S or Rule 506(c), not after the investor has signed. Our guide on how to raise capital for a real estate syndication places investor onboarding early in the deal timeline for the same reason.
What Sponsors Can Do Before the Next Raise
You can turn the October update into a short routine for every raise with investors abroad. It takes a few hours at the start of a raise and can save weeks at the end.
- List every country your prospective investors live in, including the country of each entity's owners, and check it against the current FATF call for action and grey lists.
- Run OFAC screening on every investor and every owner of an investor entity, applying the 50 Percent Rule, before documents go out.
- Ask your bank and any placement agent how they treat each listed country, what documents they will want, and how long their review usually takes.
- Collect source of funds and source of wealth documents early for investors from grey listed countries, and build that review time into the closing calendar.
- Have securities counsel confirm the offering route for each investor, and record each screening result in the deal file.
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Reading the List as a Signal
The four countries removed on October 30 will be treated differently over time. The countries still on the list will keep drawing extra questions from banks. Neither outcome decides whether a sponsor can work with a given investor. The decision rests on the sponsor's own screening, the offering rules and the judgment of the institutions holding the money.
That brings the argument back to where it began. The FATF grey list works best as an early warning that shapes the order and length of a raise. It is read alongside OFAC sanctions, never in place of them. A sponsor that checks it before the first investor call, and again after each plenary, keeps country risk in the planning stage. That is where our Regulation S guide for U.S. real estate sponsors places every cross border decision.
Frequently Asked Questions
What Is the FATF Grey List?
The FATF grey list is the Financial Action Task Force's list of jurisdictions under increased monitoring. These countries have strategic gaps in their money laundering and terrorist financing controls and have committed to an action plan to fix them within agreed timeframes. The list does not ban dealings with them, but banks and other institutions use it when deciding how closely to review a transaction.
Which Countries Were Removed From the FATF Grey List in October 2026?
On October 30, 2026, the FATF removed Bulgaria, Côte d'Ivoire, the Democratic Republic of the Congo and Monaco from increased monitoring, according to FinCEN's release that day. FinCEN named no new additions. Institutions are told to weigh the reasons behind each delisting when they assess risk, so checks on money from those countries may ease gradually rather than at once.
What Is the Difference Between the FATF Grey List and Black List?
The grey list covers countries cooperating with the FATF to fix weaknesses, and it calls for closer review based on risk. The black list, formally the call for action list, covers jurisdictions with serious unaddressed gaps. After the October 2026 plenary, Iran and North Korea face a call for countermeasures, and Burma remains subject to enhanced due diligence.
Is the FATF Grey List the Same as OFAC Sanctions?
No. The FATF grey list is guidance that institutions weigh when they set their level of review, while OFAC sanctions are binding law for U.S. persons. Under the OFAC 50 Percent Rule, an entity owned 50 percent or more in the aggregate by blocked persons is itself blocked. A sponsor needs both checks, because a clear result on one says nothing about the other.
How Often Is the FATF Grey List Updated?
The FATF publishes its grey list and black list three times a year, after each of its plenary meetings. A sponsor raising from investors abroad should recheck the lists after every plenary and before each new raise, because a country's status can change between one deal and the next. The countries an investor's entity owners live in deserve the same check.
Can a Sponsor Accept an Investor From a Grey Listed Country?
The grey list does not by itself prohibit the investment, but it usually means a longer review by the bank and any broker dealer, with more documents on identity, source of funds and source of wealth. Eligibility under Regulation S or Rule 506(c), sanctions screening and home country rules all still apply. Securities counsel should confirm the approach before the investor is admitted.
This article is for general education only and is not legal, tax or investment advice. Securities and tax rules change and depend on each sponsor's facts, so work with qualified securities counsel and tax advisors before launching an offering. Real estate investments involve risk, including loss of capital, illiquidity and changes in property values. Offerings on Raveum are available to eligible investors only and are not open to the general public.
