Russian Federation Country Summary

FATF Status

The Russian Federation is not on the FATF list of AML Deficient countries, however, due to the invasion of Ukraine, FATF has suspended the FATF membership of the Russian Federation.

Latest FATF Statement - 24 February 2023

One year after the Russian Federation’s illegal, unprovoked and unjustified full-scale military invasion of Ukraine, the FATF reiterates its deepest sympathies for the people of Ukraine and continues to deplore the huge loss of lives and malicious destruction caused by the Russia Federation’s ongoing brutal attack on Ukraine. The FATF acknowledges the United Nations General Assembly Resolution ES-11/1 which demands that the Russian Federation immediately, completely and unconditionally withdraw all of its military forces from the territory of Ukraine within its internationally recognized borders.

The FATF strongly condemns the Russian Federation’s war of aggression against Ukraine. Over the past year, the Russian Federation has intensified its inhumane and brutal attacks targeting critical public infrastructure. The FATF is also deeply concerned by the reports of arms trade between the Russian Federation and United Nations sanctioned jurisdictions, and malicious cyber-activities emanating from Russia.

The Russian Federation’s actions unacceptably run counter to the FATF core principles aiming to promote security, safety, and the integrity of the global financial system. They also represent a gross violation of the commitment to international cooperation and mutual respect upon which FATF Members have agreed to implement and support the FATF Standards. Considering the above, the FATF has decided to suspend the membership of the Russian Federation. The Russian Federation remains accountable for its obligation to implement the FATF Standards. The Russian Federation must continue to meet its financial obligations. The Russian Federation will remain a member of the Global Network as an active member of the Eurasian Group on Money Laundering (EAG) and retain its rights as an EAG member. The FATF will monitor the situation and consider at each of its Plenary meetings whether the grounds exist for lifting or modifying these restrictions.

The FATF continues to call upon all jurisdictions to remain vigilant of threats to the integrity, safety and security of the international financial system arising from the Russian Federation’s war against Ukraine. The FATF reiterates that all jurisdictions should be alert to possible emerging risks from the circumvention of measures taken in order to protect the international financial system and take the necessary measures to mitigate these risks.

The FATF again expresses its sympathies to the people of Ukraine, who have borne a terrible burden at the hands of the Russian Federation’s war of aggression. The FATF reflects the thoughts of the entire international community in hoping that this is the year that returns them to safety, peace, and prosperity.

Compliance with FATF Recommendations

The last Mutual Evaluation Report relating to the implementation of anti-money laundering and counter-terrorist financing standards in Russia was undertaken in 2024. According to that Evaluation, Russia was deemed Compliant for 6 and Largely Compliant for 31 of the FATF 40 Recommendations. It remains Highly Effective for 2 and Substantially Effective for 4 with regard to the 11 areas of Effectiveness of its AML/CFT Regime.

Corruption in Russia remains a significant issue, with Transparency International ranking the country 129th out of 180 in its 2020 Corruption Perception Index. Despite some government actions, such as the recovery of RUB 21 billion through anti-corruption investigations and a new law requiring public officials to disclose their assets, the effectiveness of these measures is undermined by a lack of whistleblower protection and widespread bribery in business dealings. Additionally, the criminal landscape in Russia is marked by human trafficking, arms trafficking, and cyber crimes, with state-embedded actors often facilitating these activities amid a backdrop of limited transparency and accountability.

The Russian Federation ranks 28th out of 190 economies in the World Bank’s Doing Business 2020 Report, indicating some regulatory improvements, yet persistent structural issues hinder foreign direct investment. The judicial system is heavily biased towards the state, and high corruption levels among officials exacerbate the risks for investors. Additionally, ongoing sanctions from the EU and U.S. since 2014 further restrict business activities and increase operational costs.

The investment climate in the Russian Federation is characterized by significant challenges, including a biased judicial system favoring the state and high levels of corruption, which deter foreign direct investment. Despite some regulatory improvements and the establishment of programs like Special Investment Contracts (SPICs) to attract foreign investors, ongoing EU and U.S. sanctions, along with restrictions on foreign ownership in strategic sectors, continue to complicate the investment landscape.