Best Code 86 Countries: A Guide To Unlocking The World

Author Saxons 04 Feb 2025

The term "code 86 country" refers to a country that has been designated as a high-risk jurisdiction for money laundering and terrorist financing by the Financial Action Task Force (FATF). Countries on the code 86 list are subject to increased scrutiny and regulation by financial institutions.

The FATF is an intergovernmental organization that sets standards and promotes policies to combat money laundering and terrorist financing. The code 86 list is a dynamic document that is updated regularly as new countries are added or removed.

There are a number of reasons why a country may be placed on the code 86 list. These include:

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Weak anti-money laundering and counter-terrorist financing laws
Lack of effective implementation of anti-money laundering and counter-terrorist financing measures
High levels of corruption
A history of being used as a conduit for money laundering or terrorist financing

Countries on the code 86 list are required to take steps to address the deficiencies that led to their inclusion on the list. This may include implementing new laws and regulations, strengthening enforcement of existing laws, and improving cooperation with other countries in the fight against money laundering and terrorist financing.

The code 86 list is an important tool in the fight against money laundering and terrorist financing. It helps to identify countries that pose a high risk for these activities and encourages them to take steps to address the problem.

Code 86 Country

A code 86 country is a country that has been identified by the Financial Action Task Force (FATF) as having weak anti-money laundering and counter-terrorist financing measures. This designation can have a significant impact on a country's economy and reputation.

High-risk: Code 86 countries are considered to be high-risk jurisdictions for money laundering and terrorist financing.
FATF: The FATF is an intergovernmental organization that sets standards and promotes policies to combat money laundering and terrorist financing.
Deficiencies: Countries are placed on the code 86 list due to deficiencies in their anti-money laundering and counter-terrorist financing measures.
Consequences: Being on the code 86 list can lead to increased scrutiny and regulation by financial institutions.
Reputation: A code 86 designation can damage a country's reputation and make it difficult to attract foreign investment.
Cooperation: Code 86 countries are required to work with the FATF to address their deficiencies and improve their anti-money laundering and counter-terrorist financing measures.

The FATF's code 86 list is an important tool in the fight against money laundering and terrorist financing. It helps to identify countries that pose a high risk for these activities and encourages them to take steps to address the problem. Countries on the code 86 list are required to develop and implement action plans to address their deficiencies. The FATF monitors the progress of these countries and may remove them from the list once they have made sufficient progress.

For example, in 2019, Iran was placed on the code 86 list due to its failure to address its deficiencies in combating money laundering and terrorist financing. As a result, Iranian banks and businesses faced increased scrutiny and regulation by financial institutions around the world. In 2021, Iran made significant progress in addressing its deficiencies and was removed from the code 86 list.

The code 86 list is a dynamic document and is updated regularly as countries make progress in addressing their deficiencies or fail to do so. The FATF's goal is to work with countries to help them improve their anti-money laundering and counter-terrorist financing measures and reduce the risk of these activities.

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1. High-risk

Code 86 countries are those that have been identified by the Financial Action Task Force (FATF) as having weak anti-money laundering and counter-terrorist financing measures. This designation can have a significant impact on a country's economy and reputation.

Increased scrutiny: Code 86 countries are subject to increased scrutiny and regulation by financial institutions. This can make it difficult for businesses in these countries to access financial services and can lead to higher costs for remittances and other financial transactions.
Reputational damage: Being on the code 86 list can damage a country's reputation and make it difficult to attract foreign investment. This can have a negative impact on economic growth and development.
Political pressure: The FATF can put political pressure on code 86 countries to improve their anti-money laundering and counter-terrorist financing measures. This can lead to changes in government policy and regulation.
Sanctions: In some cases, the FATF may impose sanctions on code 86 countries. These sanctions can include restrictions on financial transactions, travel bans, and asset freezes.

The FATF's code 86 list is an important tool in the fight against money laundering and terrorist financing. It helps to identify countries that pose a high risk for these activities and encourages them to take steps to address the problem. However, it is important to note that being on the code 86 list does not mean that a country is necessarily a safe haven for criminals. Many code 86 countries are working to improve their anti-money laundering and counter-terrorist financing measures and are making progress.

2. FATF

The FATF is an important player in the fight against money laundering and terrorist financing. It sets standards and promotes policies that help countries to improve their anti-money laundering and counter-terrorist financing measures. The FATF also monitors countries' progress in implementing these measures and takes action against countries that fail to comply.

The FATF's code 86 list is one of the most important tools in its fight against money laundering and terrorist financing. The code 86 list identifies countries that have weak anti-money laundering and counter-terrorist financing measures. Countries on the code 86 list are subject to increased scrutiny and regulation by financial institutions. This makes it more difficult for criminals to launder money and finance terrorist activities in these countries.

The FATF's work is essential to the fight against money laundering and terrorist financing. The FATF's standards and policies help countries to improve their anti-money laundering and counter-terrorist financing measures. The FATF's code 86 list helps to identify countries that pose a high risk for money laundering and terrorist financing. The FATF's work helps to make the world a safer place.

3. Deficiencies

Countries are placed on the code 86 list due to deficiencies in their anti-money laundering and counter-terrorist financing measures. These deficiencies can include:

Weak anti-money laundering and counter-terrorist financing laws
Lack of effective implementation of anti-money laundering and counter-terrorist financing measures
High levels of corruption
A history of being used as a conduit for money laundering or terrorist financing

These deficiencies can make a country a high-risk jurisdiction for money laundering and terrorist financing. This can have a number of negative consequences, including:

Increased scrutiny and regulation by financial institutions
Reputational damage
Political pressure
Sanctions

4. Consequences

Being on the code 86 list can have a number of negative consequences for a country, including increased scrutiny and regulation by financial institutions. This is because financial institutions are required to take steps to prevent money laundering and terrorist financing, and countries on the code 86 list are considered to be high-risk jurisdictions for these activities.

Increased scrutiny and regulation by financial institutions can make it more difficult for businesses in code 86 countries to access financial services. This can lead to higher costs for remittances and other financial transactions, and can make it difficult for businesses to operate and grow.

For example, in 2019, Iran was placed on the code 86 list due to its failure to address its deficiencies in combating money laundering and terrorist financing. As a result, Iranian banks and businesses faced increased scrutiny and regulation by financial institutions around the world. This made it more difficult for Iranian businesses to access financial services and led to higher costs for remittances and other financial transactions.

The practical significance of understanding the connection between being on the code 86 list and increased scrutiny and regulation by financial institutions is that it can help businesses to understand the risks involved in operating in these countries. Businesses should be aware that they may face increased scrutiny and regulation if they operate in a code 86 country, and they should take steps to mitigate these risks.

In conclusion, being on the code 86 list can have a number of negative consequences for a country, including increased scrutiny and regulation by financial institutions. Businesses should be aware of these risks and take steps to mitigate them.

5. Reputation

A code 86 designation can damage a country's reputation and make it difficult to attract foreign investment. This is because investors are often reluctant to invest in countries that are perceived to be high-risk for money laundering and terrorist financing. A code 86 designation can also make it more difficult for a country to access international financial markets, which can lead to higher borrowing costs and reduced economic growth.

For example, in 2019, Iran was placed on the code 86 list due to its failure to address its deficiencies in combating money laundering and terrorist financing. As a result, Iran's reputation was damaged and it became more difficult for the country to attract foreign investment. This had a negative impact on Iran's economy and led to a decline in economic growth.

The practical significance of understanding the connection between a code 86 designation and a country's reputation is that it can help businesses to make informed decisions about where to invest. Businesses should be aware that investing in a code 86 country can be risky, and they should take steps to mitigate these risks.

In conclusion, a code 86 designation can damage a country's reputation and make it difficult to attract foreign investment. Businesses should be aware of these risks and take steps to mitigate them.

6. Cooperation

Code 86 countries are required to work with the FATF to address their deficiencies and improve their anti-money laundering and counter-terrorist financing measures. This cooperation is essential to the FATF's mission of combating money laundering and terrorist financing worldwide.

When a country is placed on the code 86 list, the FATF works with the country to develop an action plan to address its deficiencies. The action plan typically includes measures to improve the country's anti-money laundering and counter-terrorist financing laws, regulations, and enforcement mechanisms.

The FATF monitors the progress of code 86 countries in implementing their action plans. The FATF may remove a country from the code 86 list once it has made sufficient progress in addressing its deficiencies.

Cooperation between code 86 countries and the FATF is essential to the fight against money laundering and terrorist financing. This cooperation helps to ensure that code 86 countries have the necessary laws, regulations, and enforcement mechanisms in place to combat these activities.

For example, in 2019, Iran was placed on the code 86 list due to its failure to address its deficiencies in combating money laundering and terrorist financing. As a result, Iran worked with the FATF to develop an action plan to address its deficiencies. The action plan included measures to improve Iran's anti-money laundering and counter-terrorist financing laws, regulations, and enforcement mechanisms.

In 2021, the FATF removed Iran from the code 86 list after it made significant progress in implementing its action plan. This shows that cooperation between code 86 countries and the FATF can be effective in combating money laundering and terrorist financing.

The practical significance of understanding the connection between cooperation between code 86 countries and the FATF is that it helps to ensure that these countries have the necessary laws, regulations, and enforcement mechanisms in place to combat money laundering and terrorist financing. This cooperation helps to protect the international financial system from these activities.

In conclusion, cooperation between code 86 countries and the FATF is essential to the fight against money laundering and terrorist financing. This cooperation helps to ensure that code 86 countries have the necessary laws, regulations, and enforcement mechanisms in place to combat these activities.

FAQs about "code 86 country"

This section provides answers to frequently asked questions about "code 86 country".

Question 1: What is a code 86 country?

A code 86 country is a country that has been identified by the Financial Action Task Force (FATF) as having weak anti-money laundering and counter-terrorist financing measures.

Question 2: What are the consequences of being on the code 86 list?

Countries on the code 86 list are subject to increased scrutiny and regulation by financial institutions. This can make it more difficult for businesses in these countries to access financial services and can lead to higher costs for remittances and other financial transactions.

Question 3: What can code 86 countries do to improve their status?

Code 86 countries can work with the FATF to develop and implement action plans to address their deficiencies. Once a country has made sufficient progress, it can be removed from the code 86 list.

Question 4: What is the FATF's role in combating money laundering and terrorist financing?

The FATF is an intergovernmental organization that sets standards and promotes policies to combat money laundering and terrorist financing. The FATF works with countries around the world to help them improve their anti-money laundering and counter-terrorist financing measures.

Question 5: How does the code 86 list help to combat money laundering and terrorist financing?

The code 86 list helps to identify countries that pose a high risk for money laundering and terrorist financing. This information helps financial institutions to take steps to prevent these activities.

Question 6: What are the implications of a code 86 designation for businesses?

Businesses that operate in code 86 countries may face increased scrutiny and regulation by financial institutions. This can make it more difficult and expensive for businesses to operate in these countries.

Summary: The code 86 list is an important tool in the fight against money laundering and terrorist financing. Countries on the code 86 list are required to work with the FATF to improve their anti-money laundering and counter-terrorist financing measures.

Transition: For more information on code 86 countries, please consult the FATF website.

Tips for operating in a code 86 country

Operating in a code 86 country can be challenging, but there are a number of steps that businesses can take to mitigate the risks.

Tip 1: Conduct thorough due diligence on your business partners.

This will help you to identify and avoid doing business with companies or individuals that are involved in money laundering or terrorist financing.

Tip 2: Implement robust anti-money laundering and counter-terrorist financing controls.

These controls should include measures to identify and report suspicious transactions, and to prevent your business from being used to launder money or finance terrorism.

Tip 3: Be aware of the increased scrutiny that your business may face from financial institutions.

This scrutiny may include requests for additional information about your business and its transactions. Be prepared to provide this information promptly and accurately.

Tip 4: Seek professional advice from a lawyer or accountant who is familiar with the anti-money laundering and counter-terrorist financing laws and regulations in the code 86 country.

This advice can help you to ensure that your business is compliant with all applicable laws and regulations.

Tip 5: Be prepared to adjust your business practices to comply with the requirements of the code 86 country.

This may include changes to your customer onboarding procedures, your transaction monitoring systems, or your record-keeping practices.

Summary: By following these tips, businesses can help to mitigate the risks of operating in a code 86 country. It is important to remember that the FATF's code 86 list is a dynamic document and is updated regularly. Businesses should be aware of the risks involved in operating in a code 86 country and should take steps to mitigate these risks.

Transition: For more information on code 86 countries, please consult the FATF website.

Conclusion

The FATF's code 86 list is an important tool in the fight against money laundering and terrorist financing. It helps to identify countries that pose a high risk for these activities and encourages them to take steps to address the problem. However, it is important to note that being on the code 86 list does not mean that a country is necessarily a safe haven for criminals. Many code 86 countries are working to improve their anti-money laundering and counter-terrorist financing measures and are making progress.

Businesses that operate in code 86 countries should be aware of the risks involved and should take steps to mitigate these risks. This may include conducting thorough due diligence on business partners, implementing robust anti-money laundering and counter-terrorist financing controls, and seeking professional advice from a lawyer or accountant who is familiar with the anti-money laundering and counter-terrorist financing laws and regulations in the code 86 country.

By working together, governments, financial institutions, and businesses can help to combat money laundering and terrorist financing and make the world a safer place.

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