Israel Country Summary
Medium Risk
View full Ratings TableSanctions
Medium Concern
FATF AML Deficient List
Lower Concern
Terrorism
Medium Concern
Corruption
Lower Concern
US State ML Assessment
Medium Concern
Criminal Markets (GI Index)
Medium Concern
EU Tax Blacklist
Lower Concern
Offshore Finance Center
Lower Concern
Please note that although the below Summary will give a general outline of the AML risks associated with the jurisdiction, if you are a Regulated entity then you may need to demonstrate that your Jurisdictional AML risk assessment has included a full assessment of the risk elements that have been identified as underpinning overall Country AML risk. To satisfy these requirements, we would recommend that you use our Subscription area.
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Anti Money Laundering
FATF Status
Israel is not currently on the FATF list of Countries that have been identified as having strategic AML deficiencies.
Compliance with FATF Recommendations
The last follow-up Mutual Evaluation Report relating to the implementation of anti-money laundering and counter-terrorist financing standards in Israel was undertaken in 2022. According to that Evaluation, Israel was deemed Compliant for 16 and Largely Compliant for 19 of the FATF 40 Recommendations. It was deemed Highly Effective for 3 and Substantially Effective for 5 of the Effectiveness & Technical Compliance ratings.
Sanctions
The Arab League has systematically boycotted Israel as part of an effort to isolate it economically in support of the Palestinians. This boycott includes prohibitions on the importation of Israeli-origin goods and services, as well as restrictions on business engagements with entities that operate in Israel, enforced through a blacklist maintained by the Arab League.
Criminality
Rating |
0 (bad) - 100 (good) |
|---|---|
| Transparency International Corruption Index | 64 |
| World Bank: Control of Corruption Percentile Rank | 79 |
Israel faces significant challenges related to crime and corruption, with organized crime networks and human trafficking being notable issues. While the judicial system operates independently and law enforcement is generally effective, public confidence is lacking, and allegations of governmental corruption persist, particularly concerning political figures and the diamond trade.
Economy
Israel's economy is characterized by a strong entrepreneurial spirit, a highly educated workforce, and a robust high-tech sector, earning it the nickname "Start-Up Nation." The country has seen significant growth in innovation and research, particularly through partnerships with U.S. firms, and boasts a notable presence on the NASDAQ with 131 companies listed. However, the economy faced a severe downturn following the October 2023 Hamas attack, which led to a substantial GDP drop, although a recovery is anticipated with projected growth rates of 2.0% in 2024 and 5.0% in 2025, reflecting the resilience of Israel's economic fundamentals despite ongoing geopolitical challenges.
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