Circular to Licensed Corporations, SFC-licensed Virtual Asset Service Providers and Associated Entities – Anti-Money Laundering / Counter-Financing of Terrorism

On July 14, a circular issued by the Intermediaries Division of the Securities and Futures Commission (SFC) follows up on two jurisdiction lists released by the Financial Action Task Force (FATF) on 19 June 2026 and the outcomes of its plenary meeting held the same month. The FATF’s call-for-action list retains the Democratic People’s Republic of Korea and Iran, against which comprehensive countermeasures must be enforced, alongside Myanmar where enhanced due diligence is mandatory; the FATF will consider imposing countermeasures if Myanmar fails to make further progress by October 2026. Bosnia and Herzegovina and Iraq have been added to the FATF’s increased monitoring list, while Algeria and Namibia have been removed after rectifying their deficiencies. Institutions shall implement corresponding risk controls for jurisdictions on the lists and keep track of real-time FATF updates. Multiple regulatory documents were finalised at the FATF plenary: a global overview on public-private sector intelligence sharing was published on 8 July, a report on detecting and disrupting terrorist financing via social media platforms was released on 26 June, and a public consultation on new guidelines for cross-border payment transparency will close on 21 August. Additional reports covering underground banking, virtual assets and decentralised finance risks will be rolled out in phases. Beyond risk management for jurisdictions on the two FATF lists, institutions are also required to conduct heightened scrutiny on business relationships and transactions linked to other high-risk jurisdictions. Source:  https://apps.sfc.hk/edistributionWeb/gateway/EN/circular/intermediaries/supervision/doc?refNo=26EC39 Relative Circulars: https://www.fatf-gafi.org/content/fatf-gafi/en/publications/High-risk-and-other-monitored-jurisdictions/call-for-action-june-2026.html Relative Circulars: https://www.fatf-gafi.org/content/fatf-gafi/en/publications/High-risk-and-other-monitored-jurisdictions/increased-monitoring-june-2026.html