EU Moves to Place Russia on High-Risk Money-Laundering List

The European Commission has opted to include Russia on its register of jurisdictions deemed to present a “high risk of money laundering and terrorist financing,” marking a significant escalation in the bloc’s financial-crime stance. The decision follows Russia’s suspension from the Financial Action Task Force (FATF) after its full-scale invasion of Ukraine, a step that still stopped short of formally blacklisting Moscow. Attempts by the Ukrainian government to secure that outcome at FATF were blocked by resistance from BRICS members — Brazil, India, China, South Africa and Russia itself — preventing the watchdog from taking the harder line sought by Kyiv.

For months, European legislators had urged the Commission to act where FATF had been unable to. A draft of the planned designation, which will appear as an annex to the EU’s list, outlines the measures that will accompany the move. Although the Union already enforces extensive sanctions that severely restrict Russian access to European financial markets, the addition to the blacklist comes at a delicate moment: the Commission is simultaneously working to break Belgium’s opposition to deploying proceeds from Russia’s frozen assets to support Ukraine.

Once the classification is formalised, financial institutions across the bloc will be required to apply reinforced due-diligence procedures to any Russian-linked transactions. Banks that have yet to adjust their exposure will be compelled to take further steps to “de-risk,” an obligation that could tighten the financial environment for any remaining Russian operations within Europe.

Historically, the EU has mirrored FATF determinations when updating its own list of high-risk jurisdictions. However, with the establishment of the new Anti-Money Laundering Authority this year, the Union has begun asserting greater autonomy over its financial-crime framework. From July 2027, this authority — AMLA — will participate directly in preparing the blacklist.

The latest move follows earlier deliberations in June, when the EU weighed whether Russia’s inadequate anti-money-laundering systems warranted a formal high-risk designation.

By fLEXI tEAM