Latest Developments
The Financial Action Task Force (FATF) — an international money laundering and terror finance watchdog — removed Turkey from its grey list of countries that require stricter monitoring on June 28. Turkey, a FATF member, was initially placed on the FATF grey list in 2021 due to Ankara’s material support for terrorist groups. However, FATF said in February 2024 that Ankara had implemented “key reforms,” paving the way for Turkey’s eventual removal from the grey list. The international watchdog said on June 28 that Turkey had made “significant progress” and “is therefore no longer subject to the FATF’s increased monitoring process.” Turkish Vice President Cevdet Yilmaz said that the decision to delist Turkey “will have extremely positive consequences for the financial sector and the economy.” An FDD policy brief published on June 27 warned that Turkey’s removal from the list “could significantly undermine efforts to curb Ankara’s role as a well-documented hub for terror finance.”
Meanwhile, FATF added Venezuela — a hub for illicit finance and a close ally of Iran — to its grey list on June 28. The watchdog said Caracas “needs to work on issues such as its investigation and prosecution of money laundering and terrorist financing,” and crack down on “the misuse of nonprofit organizations for terrorism financing,” The Wall Street Journal reported.
Expert Analysis
“The FATF decision is more than a mistake and will only serve to augment Turkey’s already entrenched ties to Hamas and possibly other terrorist entities. One does not need to be a bureaucratic wizard, well-versed in the technical compliance requirements of FATF, to determine that Turkey falls way short of taking measures against terrorism financing. The Turkish government of Recep Tayyip Erdogan is Hamas’s premier champion, providing the designated terrorist entity with material support to include financing capabilities.” — Sinan Ciddi, FDD Non-Resident Senior Fellow
“Venezuelan regime officials and their relatives have been the targets of multiple U.S. law enforcement money laundering and drug trafficking investigations, which have led to multiple convictions. Venezuela’s close relationship with Iran revolves around illicit financial schemes the two regimes coordinate to evade U.S. sanctions. Venezuela is host to the Latin American operations of sanctioned Iranian entities. In the past, the regime has also granted thousands of Venezuelan passports to Iranian intelligence and Hezbollah officials to facilitate their operations in the region. With that in mind, Venezuela’s addition to FATF’s grey list is well deserved.” — Emanuele Ottolenghi, FDD Senior Fellow
Turkish Support for Iran-Backed Terrorism
Turkey has long been a haven for Iran-backed Hamas. In 2012, Ankara reportedly donated $300 million to Hamas as the group set up shop in Turkey. Turkish banks, private companies, and non-governmental organizations (NGOs) also funnel money to Hamas and other terrorist groups. The Foundation for Human Rights (IHH), an NGO with ties to the Turkish government, has transferred cash payments to its branch in the Gaza Strip since 2010. Hamas uses these payments to fund terrorism. In 2020, a U.S. district court explicitly ruled that the Turkish bank Kuveyt Turk Bank “helped finance the Hamas.” In October, the U.S. Treasury Department sanctioned affiliates of the Turkish company Trend GYO for providing material support to Hamas. The Treasury Department additionally sanctioned the Turkish company Al Aman Cargo in December for “facilitating the flow of Iranian financial assistance” to the Iran-backed Houthis in Yemen.
Venezuela and Illicit Finance
Venezuela is engaged in illicit finance schemes. In particular, Caracas, an oil producer, works with Tehran to evade U.S. oil sanctions. In 2022, for example, British media revealed that Iran’s Islamic Revolutionary Guard Corps (IRGC) was illegally “facilitating the sale of Iranian oil” to Venezuela in exchange for gold. The IRGC shipped the gold to Tehran via the sanctioned Iranian airline, Mahan Air, and used it to help fund Hezbollah’s terrorist activity.
“Turkey Should Remain on FATF Grey List,” by Max Meizlish and Sinan Ciddi
“Iran and Venezuela Deepen Their Strategic Alliance,” by Emanuele Ottolenghi
“10 Things to Know About Hamas and Turkey,” FDD Insight
