Canada flags Iran, North Korea transactions as high risk after FATF update

OTTAWA, March 2, 2026 — Canada’s financial intelligence agency issued a fresh advisory to reporting entities on Monday, telling them to treat transactions involving Iran and the Democratic People’s Republic of Korea as high risk and to apply enhanced vigilance to business linked to Myanmar, following the Financial Action Task Force’s February plenary decisions.

FINTRAC said the advisory follows FATF statements released after the watchdog’s Feb. 11-13 plenary in Mexico City. The FATF kept North Korea, Iran and Myanmar on its list of high-risk jurisdictions subject to a call for action, while maintaining a separate “grey list” of jurisdictions under increased monitoring.

For North Korea, FINTRAC said Canadian reporting entities must treat every transaction originating from or destined for the country as high risk, verify the identity of parties involved regardless of amount, keep records, and factor sanctions-evasion risks into compliance programs and correspondent banking controls. FINTRAC said the FATF again warned about Pyongyang’s ongoing anti-money laundering and terrorist financing deficiencies and the threat tied to weapons proliferation financing.

For Iran, FINTRAC said the Finance Ministry directive requires firms to classify all transactions to or from Iran as high risk, verify clients, conduct due diligence on source of funds or virtual currency, keep records, and report all such transactions to FINTRAC. The agency said the FATF, building on its October 2025 position, reaffirmed and strengthened its statement on Iran at the February 2026 plenary and introduced new countermeasures.

Myanmar remains subject to enhanced due diligence rather than full countermeasures. FINTRAC said firms should assess whether transactions linked to Myanmar require suspicious transaction reports and should account for sanctions-evasion risks under Canada’s broader sanctions reporting regime.

The FATF also added Kuwait and Papua New Guinea to its increased-monitoring list in February and said no jurisdictions were removed from the grey list at that meeting. FINTRAC’s advisory lists 22 jurisdictions under increased monitoring, including Monaco, Syria, Venezuela and the British Virgin Islands.

The move underscores how Canadian authorities are aligning domestic compliance expectations with FATF decisions as scrutiny intensifies on sanctions evasion, proliferation financing and cross-border illicit finance.