Internal discord over Iran's place on FATF blacklist

Iran's political elite is divided over the nation's refusal to comply with international financial regulations under the Financial Action Task Force (FATF), which has placed the country on its blacklist.

The hardline faction has ramped up their opposition to the international anti-money laundering and counter-terrorism financing body after eight years of its appeals for compliance.

The infighting within the government comes at a time when Iran’s economy is grappling with sanctions, inflation, and widespread public dissatisfaction, posing challenges for new President Masoud Pezeshkian’s administration. The FATF demands compliance with global rule on money laundering and terrorism financing among other requirements.

One of the most contentious aspects of the FATF debate in Iran is the Palermo Convention, which requires member countries to combat transnational organized crime.

The internal discord over FATF poses a challenge for President Masoud Pezeshkian, who was elected on promises of economic reform. After an election campaign marked by low voter turnout and public disillusionment with the political system, Pezeshkian secured victory by promising to address the country’s dire economic situation amid the worst crisis since the founding of the Islamic Republic.