FATF Has Not Closed the Door on Iran
WANA (Oct 25) – The head of Iran’s Financial Intelligence Center has announced that the approval of the Palermo and CFT bills does not automatically mean the country’s removal from the Financial Action Task Force (FATF) blacklist. He emphasized that Iran’s technical engagement with FATF has only recently begun and is expanding steadily.
Hadi Khani, Secretary of the Supreme Council for the Prevention and Combating of Money Laundering and Terrorist Financing, stated: “The approval of the Palermo Convention, as one of the 41 items in our action plan, does not equate to leaving the blacklist. Our dialogue and cooperation with FATF have just started and are growing day by day.”
Beginning of Iran–FATF Engagement
According to the Financial Intelligence Center, efforts to remove Iran from the FATF blacklist began about a year ago—an issue that has burdened Iran’s economy for 14 of the past 18 years and has affected trade even with friendly and aligned countries.
Following extensive discussions within the Expediency Council, the Palermo Convention was conditionally approved in May this year, after receiving prior confirmation from the Guardian Council. On October 9, the Expediency Council also conditionally approved Iran’s accession to the Convention on Combating the Financing of Terrorism (CFT).
FATF Rejects Iran’s Accession to Palermo Convention
WANA (Oct 25) – The Financial Action Task Force (FATF) announced on Friday that it has rejected Iran’s approval of the Palermo Convention due to Tehran’s extensive reservations regarding the definition and identification of terrorist groups. According to a statement published on the FATF website, Iran submitted a report in September 2025 detailing its […]
In response, FATF extended an invitation to Iran—for the first time in six years—to attend its main plenary session. During the meeting, Khani presented a report outlining Iran’s progress on its action plan, focusing on the adoption of the Palermo Convention.
FATF Response and Iran’s Position
In its latest report, FATF stated that “Iran’s extensive reservations on the Palermo Convention are not in line with the standards of the FATF” and called on member states to maintain countermeasures against Iran. This statement triggered criticism from several lawmakers and experts.
In response, Khani explained that due to the timing of the CFT approval, only the Palermo Convention was reviewed during the latest FATF session. “Except for one reservation that requires further legal review, our documentation—demonstrating that Iran’s domestic laws are even stronger than the Palermo provisions—was presented and accepted,” he said.
He added that the country’s case with FATF is now proceeding “on a technical and legal track” and that further expert meetings will continue.
A Technical, Not Political, Path
Addressing FATF’s reference to sanctions linked to the UN “snapback mechanism,” Khani said the group’s position merely reflects the implementation of existing UN Security Council resolutions and does not introduce any new element. “Even if this had not been mentioned in the statement, it would make no practical difference, as these measures have long been in place,” he noted.
Toward a Reduction in Countermeasures
Analysts believe that Iran’s approval of the Palermo and CFT conventions, along with renewed direct talks with FATF, could pave the way for a formal request to suspend or ease countermeasures against the country.
The key advantage of leaving the FATF blacklist, they argue, lies in restoring Iran’s international reputation. Currently, because of its blacklisted status, Iranian nationals are often labeled as “high-risk” in the global financial system, facing stricter scrutiny and limited access to banking and financial services.
Iran’s History with FATF
Iran was first placed on FATF’s blacklist in 2008 and remained there until 2016. In June 2016—six months after the implementation of the JCPOA (the Iran nuclear deal)—FATF suspended its countermeasures against Iran for 12 months. However, following the U.S. withdrawal from the deal under President Donald Trump, FATF reinstated Iran on its blacklist in February 2020.
Since then, FATF has consistently classified Iran as a “high-risk jurisdiction” for investment in all its public statements. Nevertheless, Iranian officials hope that through sustained technical cooperation, these countermeasures may gradually be eased.
Khani reiterated that FATF “has not closed the door on Iran” and that with continued step-by-step progress in implementing the action plan, the country could steadily move toward reintegration into the global financial system.
