FATF Returns to Türkiye: Global Watchdog Tests the Real Fight Against Dirty Money

Türkiye is once again under the spotlight of the Financial Action Task Force (FATF) — the global body overseeing the fight against money laundering (ML) and terrorist financing (TF). After being removed from the grey list in 2024, Türkiye will now undergo an on-site review as part of FATF’s 5th-round mutual evaluation, designed to assess how effectively reforms are being implemented in practice.

A Deep Dive into Türkiye’s Financial Defenses

According to former MASAK President Osman Dereli, the FATF team will meet with a broad range of stakeholders, including law enforcement and financial intelligence units, regulators, and representatives from the private sector. “This time, the evaluation will not only assess whether laws exist on paper but how effectively they are being applied and what measurable results they produce,” Dereli told Ekonomim.

The FATF delegation is expected to visit in November 2025, focusing on the practical efficiency of Türkiye’s anti-money laundering (AML) and counter-terrorist financing (CTF) systems.

Effectiveness Over Legislation

Unlike previous rounds, the current assessment will emphasize effectiveness rather than mere legal compliance. FATF examiners will evaluate how institutions use their authority, how cases are investigated and prosecuted, and whether tangible outcomes — such as asset seizures and convictions — are achieved.

Key attention will also be given to data sharing and cooperation between agencies. FATF expects real-time coordination among MASAK, the police, prosecutors, and supervisory authorities, as well as accurate, up-to-date records of beneficial ownership to ensure transparency in financial transactions.

Technology and Emerging Risk Areas Under Scrutiny

The 5th-round evaluation introduces a new dimension: technology-driven AML/CTF efforts. FATF will assess how effectively countries deploy artificial intelligence (AI), machine learning, and data analytics to detect illicit financial activity.

Emerging risks — including cryptocurrency transactions, electronic money systems, real estate, and high-value commodity trade — will be closely analyzed. As these sectors have increasingly become conduits for illicit funds, FATF will expect robust monitoring mechanisms to be in place.

“Türkiye Has Stepped Up Its Game”

Dereli highlighted that Türkiye has made significant strides since its earlier FATF evaluations in 2011 and 2021, when the country was placed on the grey list for insufficient enforcement and legal shortcomings. He pointed to major reforms since then, including:

• Expanded MASAK authority for investigations and sanctions

• Increased administrative fines for AML/CTF violations

• New asset-freezing mechanisms to target criminal proceeds

“These measures have elevated Türkiye to a higher league in the fight against financial crime,” Dereli said.

FATF’s Key Expectations from Türkiye

The FATF’s upcoming evaluation will not only assess institutions like MASAK, BDDK, and SPK, but also extend to banks, payment service providers, crypto asset firms, and precious metals traders. The watchdog’s main expectations include:

• MASAK is generating actionable and practical financial intelligence

• Data-driven collaboration between investigators, prosecutors, and regulators

• Ensuring accurate and accessible beneficial ownership data

• Stronger compliance from lawyers, accountants, and real estate agents in AML/CTF controls

• Adopting a risk-based approach without hindering financial inclusion (especially for NGOs and SMEs)

• Measuring asset confiscations and enforcement outcomes through quantitative data

FATF Lists: Why They Matter

Founded in 1989 by the G7, FATF sets international AML/CTF standards through 40 Recommendations (technical compliance) and 11 Effectiveness Criteria (practical application).

• Grey List (Increased Monitoring): This list includes countries that have AML/CTF deficiencies but are working with the FATF to resolve them. While not punitive, it damages investor confidence, slows capital inflows, and can affect credit ratings.

• Black List (High-Risk Jurisdictions): Reserved for nations like Myanmar, North Korea, and Iran, which pose severe financial integrity risks. The FATF advises against engaging in business or financial dealings with them.

A Critical Test for Türkiye’s Financial Credibility

For Türkiye, the 2025 FATF review is more than a compliance check — it’s a credibility test for the country’s financial system. A successful evaluation could solidify investor confidence, attract foreign capital, and confirm that Türkiye’s reforms are delivering tangible results.

In Dereli’s words, the FATF visit represents “not just an audit, but a crucial opportunity for Türkiye to showcase its progress and reaffirm its commitment to global financial transparency.”