Since the end of the Brexit transition period, the UK has maintained its own independent approach to identifying high-risk third countries under its anti-money laundering (AML) regime.

This article outlines the current obligation to apply enhanced customer due diligence under Regulation 33(1)(b) of the Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations 2017, recent updates to the list of high-risk jurisdictions and what these changes mean for firms subject to AML regulation.

Understanding the legal framework

Under Regulation 33(1)(b) of the UK’s AML regulations, firms must apply Enhanced Due Diligence (EDD) in any transaction or business relationship involving a person established in a high-risk third country. This requirement is a critical control to help mitigate the elevated risks of money laundering, terrorist financing, and proliferation financing associated with these jurisdictions.

Previously, the UK adopted the EU's list of high-risk countries. However, from 1 January 2021, the UK established its own standalone list; this means that any updates made to the EU list after Brexit no longer apply in the UK.

Legal definition of a high-risk third country

From 22 January 2024, the definition of a ‘high-risk third country’ was clarified under Regulation 33(3)(a) to include any country appearing on either of the two FATF (Financial Action Task Force) lists:

• high-risk jurisdictions subject to a call for action
• jurisdictions under increased monitoring.

These FATF lists are updated three times per year, following the conclusion of each plenary meeting in February, June and October. Businesses must stay current with these updates to ensure compliance.

Latest developments (June 2025)

Following the most recent FATF plenary in June 2025, several important updates were made to the FATF’s lists, which the UK uses to define high-risk third countries:

Added to the list:

• Bolivia
• Virgin Islands (UK).
  
  

Removed from the list:

• Croatia
• Mali
• Tanzania.

While FATF removed Senegal and Syria from its lists, it remains on the EU’s list of non-cooperative jurisdictions for tax purposes, and firms should remain vigilant.

Current UK list of high-risk third countries

As of 13 June 2025, the FATF published the most recent update to its lists of jurisdictions identified as having strategic deficiencies in their AML/CTF regimes, of ‘Jurisdictions Under Increased Monitoring’ and ‘High-Risk Jurisdictions subject to a Call for Action’.

In response to the latest FATF statements, HM Treasury advises firms to consider, at the time of publication, that the following jurisdictions are considered ‘High-Risk Third Countries’ as defined by Regulation 33 of the MLRs:

• Algeria
• Angola
• Bolivia
• British Virgin Islands
• Bulgaria
• Burkina Faso
• Cameroon
• Côte d’Ivoire
• Democratic People’s Republic of Korea
• Democratic Republic of the Congo
• Haiti
• Iran
• Kenya
• Lao PDR
• Lebanon
• Monaco
• Mozambique
• Myanmar
• Namibia
• Nepal
• Nigeria
• South Africa
• South Sudan
• Syria
• Venezuela
• Vietnam
• Yemen.

Of these jurisdictions, the following are also subject to financial sanctions measures which require firms to take additional measures:

• Democratic People’s Republic of Korea
• Democratic Republic of the Congo
• Haiti
• Iran
• Myanmar
• South Sudan
• Syria
• Venezuela
• Yemen.

Read details of financial sanctions targets by the regime.

Compliance obligations: Enhanced Due Diligence

Where a business relationship or transaction involves a person from a high-risk third country, the firm must apply Enhanced Due Diligence. This may include:

• obtaining additional information on the customer and the purpose of the business relationship
• increased monitoring of the relationship
• enhanced scrutiny of the source of funds and wealth
• approval from senior management before establishing or continuing the relationship.

For further guidance, firms should refer to Customer due diligence guidance.

Conclusion

The UK's independent AML regime continues to evolve in response to international risks and obligations. Firms must remain vigilant, ensure timely implementation of Enhanced Due Diligence measures, and keep up to date with changes to the FATF and UK government lists.

Failure to comply with these obligations could result in severe regulatory consequences, reputational damage, and increased exposure to financial crime. Use all our resources on our AML hub to keep your practice on the right side of the regulations.