Kenya remains on the Financial Action Task Force (FATF) grey list, even as South Africa, Nigeria, Mozambique, and Burkina Faso, have been cleared after making progress in fighting money laundering and terrorist financing.
In an announcement on Friday, October 24, during the FATF plenary meeting in Paris, delegates reviewed reforms made by countries under increased monitoring.
The Paris-based watchdog said the four nations had completed their action plans and passed on-site inspections that confirmed significant improvement.
FATF President Elisa de Anda Madrazo praised the outcome, describing it as a positive story for the continent. She commended the countries for strengthening their systems to detect and prevent illicit financial flows.
She highlighted that South Africa had enhanced its ability to trace suspicious transactions, Nigeria had improved coordination among government agencies, Mozambique had increased financial intelligence sharing, and Burkina Faso had tightened oversight of financial institutions.
“It marked a major milestone in Nigeria’s journey towards economic reform, institutional integrity and global credibility,” Nigerian President Bola Ahmed Tinubu said.
South Africa’s tax chief Edward Kieswetter also welcomed the news, saying the move was encouraging but warning that the work was far from over.
Nigeria and South Africa joined the grey list in 2023, followed by Mozambique in 2022 and Burkina Faso in 2021. Their removal reflects growing confidence in Africa’s efforts to combat financial crimes.
Kenya, however, continues to face scrutiny after being listed in February 2024 for weaknesses in its anti-money laundering and counter-terrorism financing systems. FATF cited gaps that make the country vulnerable to corruption, tax evasion, trade misinvoicing and terrorist financing.
The listing has come with consequences. In June 2025, the European Commission added Kenya to its list of high-risk countries for financial crime, forcing European banks and financial institutions to apply stricter checks when dealing with Kenyan clients.
This has increased compliance costs for local businesses and slowed cross-border transactions. Experts warn that it could discourage investment and make it harder for Kenyan firms to access trade finance or open accounts in Europe.
In response, President William Ruto signed the Anti-Money Laundering and Countering of Terrorism Financing Laws (Amendment) Bill, 2025, along with the Insurance Professionals Bill, 2024, on June 17, 2025.
The new laws aim to close loopholes in property transactions, shell companies and financial oversight while tightening supervision across key sectors such as banking, insurance, retirement benefits and betting.
Officials say the reforms are designed to bring Kenya’s legal framework in line with FATF and ESAAMLG standards to improve transparency and accountability.
Transparency International estimates that Kenya loses around Ksh 253 billion each year through illicit financial flows. The organisation says remaining on the grey list should push the government to strengthen law enforcement and improve financial transparency.
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