Has the war hampered FATF compliance procedures?

There is no specific date for the issuance of the Financial Action Task Force (FATF) report, which includes an update on the progress of countries placed on the grey list and subject to enhanced monitoring. While Lebanon has committed to a 2024-2025 action plan to address strategic deficiencies in combating money laundering and terrorist financing, the level of progress has not been sufficient to achieve a decisive breakthrough in this process. Today, with the new report expected, attention is turning, amid the approaching release date, to how Lebanon’s situation will be assessed, particularly in light of the repercussions of Iran’s “support war” and its impact on compliance and oversight effectiveness.

Despite the outbreak of Iran’s “support war” in Lebanon, the implementation of the anti–money laundering and counter–terrorist financing framework has not been suspended. Regulatory bodies, particularly the Banque du Liban and the Special Investigation Commission, have continued to enforce core measures such as monitoring transfers and reporting suspicious transactions, under pressure from international obligations imposed by the FATF.

This reflects adherence to urgent laws and regulations aimed at preventing Lebanon from slipping onto the blacklist. However, during wars, authorities’ focus typically shifts toward security and social conditions (as happened in Lebanon due to displacement and efforts to secure shelters, food, and basic necessities) resulting in a general weakening of regulatory and judicial work, including anti-money laundering and counter–terrorist financing efforts. Moreover, wartime economies often see a significant expansion of cash-based activity through financial flows via associations or parallel channels used to assist war-affected populations. This is especially critical in a fragile economy that has begun seriously attempting to reduce cash circulation in order to limit money laundering and terrorist financing through exchange offices, lawyers, and notaries, with the aim of removing Lebanon from the grey list.

Lebanon still has one year before its status is reassessed in 2027 to determine whether it will exit or remain on the grey list. Inclusion on this list is considered an “international warning” that threatens a country’s continued participation in the global financial system. It places the country under scrutiny, and any failure to implement reforms could push it toward greater financial isolation if it slips onto the blacklist.

Lawyers’ and notaries’ compliance measures remain in force

In Lebanon’s case, based on procedures previously issued by the Ministry of Justice, its supervisory authority over the Bar Association and notaries, in cooperation with the Special Investigation Commission at the Banque du Liban, which serves as the liaison between the FATF on one side and banks, money transfer institutions, exchange offices, notaries, and lawyers on the other; these measures remain in place during the war as routine administrative procedures. They involve obtaining information and reporting suspicious transactions to the Commission when necessary. However, the main problem lies in reliance on informal transfer channels, which makes it difficult to track financial flows during wartime and increases the risks of money laundering and financing illicit activities.

In this context, and prior to the outbreak of a 45-day full-scale war followed by a 10-day ceasefire, training sessions for members of the Bar Association had been scheduled to begin in March but did not take place. Former Bar Association President Fadi al-Masri, who followed the implementation of anti–money laundering laws, told Nida Al Watan that the association, under the supervision of the current president, lawyer Imad Martinos, continued its work within the compliance committee. He noted that the United Nations Office on Drugs and Crime (UNODC) was preparing to launch an extensive training program for lawyers in March 2026.

Oversight and compliance

However, with the start of field visits to law offices, the war broke out, leading to the postponement of some activities and tasks. Nevertheless, the Bar Association continues daily monitoring and compliance efforts developed during 2024 and 2025, particularly ensuring that there are no dealings with individuals listed under sanctions or classified as terrorists according to local and international standards.

Al-Masri confirmed that the Beirut Bar Association, through its compliance committee, continues its diligent and ongoing work with all relevant local and international bodies to achieve its national and professional objectives of protecting Lebanon and the legal profession from financial and legal risks.

In November 2025, the association selected law firms operating in financial, commercial, and real estate sectors and sent them a detailed questionnaire regarding the nature of their work and compliance procedures. Most lawyers responded with comprehensive answers, which were then used by the GIZ foundation to prepare an evaluation.

In this context, al-Masri, in his capacity as Bar Association president, explained that he prepared a training program for 2026, during the current term, in addition to forming working groups of lawyers to visit relevant offices and assess compliance with applicable laws, as part of the association’s regulatory role.

Lawyers’ measures

In this regard, it is important to highlight the key additional steps taken by the Beirut Bar Association through its compliance committee and under the direct supervision of the president:

Direct cooperation with the Special Investigation Commission at the Banque du Liban and the German Development Cooperation agency (Deutsche Gesellschaft für Internationale Zusammenarbeit – GIZ), mandated by the Commission to provide technical assistance to the association, with the participation of the European Union, within the framework of implementing the FATF action plan, particularly the third and fourth immediate outcomes related to the role of the Beirut Bar Association.

This joint work between the association and GIZ experts focuses on preparing a sectoral risk assessment for the legal profession, particularly regarding money laundering and terrorist financing risks, and strengthening the role of the bar associations in supervising lawyers’ compliance with their obligations in this field.

Ongoing coordination with the Special Investigation Commission to jointly achieve FATF-defined objectives and ensure lawyers’ compliance with their obligations under Law No. 44/2015, in line with the association’s relevant guidelines.

A meeting with the Prime Minister to present the association’s goals related to removing Lebanon from the grey list and preventing its inclusion on the blacklist.

The problem in Lebanon, as identified by the FATF, is not the absence of laws, but rather the weakness of their implementation. This gap, even if it widens during wartime, must be addressed and gradually closed through continued reforms in order for Lebanon to meet FATF requirements and exit the grey list.