Iran — Country Risk Report

Iran (Middle East • Western Asia). Risk report as of the 19 Jun 2026 FATF plenary.

Very high country risk, with governance and institutional weakness. Iran's country risk score is 8.5/10, placing it in the very high-risk band. Some information is unavailable, so the available parts are rebalanced and the country will not be labelled Low risk while information is missing. The principal score driver is governance and institutions, contributing 2.3 of 8.5 points. Separately, the treatment overlays show that Iran is subject to a FATF call for action requiring countermeasures, and that Iran is subject to comprehensive country-wide sanctions. Firms should apply additional scrutiny where exposure involves state-linked entities, restricted sectors, sensitive technology, dual-use goods or politically exposed counterparties.

Recommended treatment

Enhanced due diligence, with restriction or prohibition of higher-risk activity.

At a glance

• FATF status: Black list (one indicator only; it does not set the overall country risk rating by itself)
• Comprehensive country-level sanctions programme identified; this is a legal treatment overlay and does not change the numeric country-risk score.
• Governance and institutions: 6.7/10
• Corruption (CPI 2025): 23/100, rank #153 of 182
• Enforcement data: not yet assessed (no RegActions coverage)

Country Risk Score: 8.5/10 (Very high)

Higher score means higher country risk (global average 5.5). Some information unavailable. Provisional composite score. Limited supporting evidence. Enforcement activity and CPI are context only; FATF listing and sanctions are regulatory overlays except the labelled FATF listing status used where no mutual evaluation exists.

Some underlying pillars are unavailable. Available weights are rebalanced; missing evidence is not treated as low risk. Some underlying evidence is unavailable; the available pillars are reweighted transparently and the result should not be treated as equally certain as a composite score. Weight sensitivity 8.4–8.7/10.

How this score was calculated

• AML/CFT effectiveness: information unavailable — 0% of this score
• Technical compliance: information unavailable — 0% of this score
• Governance and institutions: 6.7/10 — 35% of this score
• FATF listing status: 9.5/10 — 65% of this score
• FATF effectiveness ratings are incomplete
• FATF technical safeguard ratings are incomplete
• No FATF mutual evaluation exists for this jurisdiction; FATF's public determination is used in place of assessment ratings

Sanctions treatment: Enhanced legal review. FATF treatment: countermeasures.

Principal risk drivers

• Governance and institutions: 6.7/10 × 35% = 2.3 points

Mitigating factors

• Risk is concentrated in specific counterparties, sectors and transactions rather than applying uniformly.

Business impact

• Customer onboarding (Restricted): Most new relationships cannot be established without a licence or exemption.
• Payments and transactions (Restricted): Payments are prohibited except under a licence or a recognised exemption.
• Trade and export activity (Restricted): Goods, services and end users need licence checks before any commitment.
• Corporate clients (Restricted): Assess state ownership, government links and political exposure.
• Ongoing monitoring (Enhanced): Alert on ownership changes, new designations and status changes.

Recommended controls

• Verify ultimate beneficial ownership using more than one reliable source.
• Identify state ownership, government influence and politically exposed persons.
• Screen entities, directors and beneficial owners against applicable sanctions lists.
• Apply enhanced review to technology, defence, telecommunications, financial services and dual-use activity.
• Document transaction purpose and source of funds where cross-border structures are complex.
• Escalate unresolved ownership opacity or adverse information to Compliance.

Enhanced due diligence triggers

• State ownership / control
• PEP involvement
• Sensitive / restricted sectors
• Opaque ownership
• Adverse media
• Dual-use goods & technology
• High-risk intermediary routing

FATF status: Black list

High-Risk Jurisdiction Subject to a Call for Action. Subject to call for action and countermeasures. Last reviewed 19 Jun 2026; next FATF plenary Oct 2026.

Sanctions: Comprehensive

• EU — sectoral: Restrictive measures in relation to serious human rights violations in Iran (source)
• EU — sectoral: Restrictive measures in relation to the non-proliferation of weapons of mass destruction (source)
• EU — sectoral: Restrictive measures in view of Iran’s military support to Russia’s war of aggression against Ukraine and to armed groups and entities in the Middle East and the Red Sea region (source)
• OFAC — comprehensive: Iran Sanctions (source)
• UK — sectoral: Iran nuclear sanctions (source)
• UK — sectoral: Iran sanctions (source)
• UN — sectoral: 1737 Iran sanctions (source)

Source details

International sanctions by issuing body

• UN: Yes (Sectoral)
• EU: Yes (Sectoral)
• UK: Yes (Sectoral)
• US: Yes (Comprehensive)

No means the complete UN, UK, EU and US review found no direct country-level programme. People or organisations may still appear on sanctions lists.

Government effectiveness and rule of law (World Bank 2024, percentile)

• Government Effectiveness: 38/100
• Regulatory Quality: 31/100
• Rule of Law: 36/100

Regulators and legal framework

FATF network

Outside the FATF regional network.

National regulators

Regulator profiles not yet available on RegActions.

FIU: Not an Egmont Group member

Framework signals

• FATF listing: Black list
• International sanctions: comprehensive country programme (legal treatment overlay)
• Corruption (CPI 2025): 23/100, rank #153 of 182
• Rule of law (WGI): 6.5/10 risk

Regulatory ecosystem and enforcement visibility

This evidence map is separate from Country Risk v3. It describes official mandates, publication access and RegActions coverage; it does not judge regulatory strength or add points to country risk.

Transparency Index: not scored · Evidence disposition: local-authority-evidence · Mapped official authorities: 2.

Evidence level: Level 1: Identity confirmed. The ladder uses the authority evidenceLevel schema directly and does not infer a level from a URL, site access or RegActions feed count.

1. 1. Identity confirmed — The authority and its mandate are evidenced by official directory provenance.
2. 2. Regulatory activity visible — A qualified authority-owned route has provisional dated activity in the first-page scan.
3. 3. Enforcement visible — A qualified authority-owned enforcement route has provisional dated activity in the first-page scan.
4. 4. Score eligible — Shown only when the authority evidence schema explicitly records score-eligible; no authority currently does.

Enforcement visibility: No authority is classified enforcement-visible or score-eligible in the authority evidence schema. Enforcement visibility remains unknown or limited to identity/activity evidence; this is not evidence of no enforcement.

Authorities and mandate evidence

• Securities and Exchange Organization — Level 1: Identity confirmed · Official site timed out

  Mandates: Securities · Access status: Official site timed out · Research/publication snapshot checked: 2026-08-20

  Official authority site

  Provisional first-page scan signal

  Signal: unknown · Observed month count: unknown · Latest observed month: unknown.

  Source access was limited during this research check, so activity remains unknown. This is not evidence of inactivity.

  Scan contract and precision

  automated-first-page-date-scan · 2024-01 to 2026-08 · as of 2026-08-20 · month precision · first-page-only-unvalidated. This is not a validated engagement frequency.

  No publication candidate is qualified. Regulatory activity and enforcement visibility remain unknown.

  Activity and enforcement visibility remain unknown; this access limitation does not establish that the authority has no enforcement activity.

• The Central Bank of the Islamic Republic of Iran — Level 1: Identity confirmed · Official site could not be reached

  Mandates: Central bank, Prudential supervision · Access status: Official site could not be reached · Research/publication snapshot checked: 2026-08-20

  Official authority site

  Provisional first-page scan signal

  Signal: unknown · Observed month count: unknown · Latest observed month: unknown.

  Source access was limited during this research check, so activity remains unknown. This is not evidence of inactivity.

  Scan contract and precision

  automated-first-page-date-scan · 2024-01 to 2026-08 · as of 2026-08-20 · month precision · first-page-only-unvalidated. This is not a validated engagement frequency.

  No publication candidate is qualified. Regulatory activity and enforcement visibility remain unknown.

  Activity and enforcement visibility remain unknown; this access limitation does not establish that the authority has no enforcement activity.

Download regulatory ecosystem PDF · CSV · JSON

Sector exposure

• Banking & payments (High): FATF call-for-action overlay requires enhanced treatment
• Trade & export controls (High): Comprehensive sanctions overlay restricts most cross-border trade
• Crypto & virtual assets (High): FATF call-for-action overlay requires enhanced VASP treatment
• Real estate & luxury assets (High): BO subscore 9.0/10; CPI context 23/100
• State-linked & procurement (High): Comprehensive sanctions overlay restricts state-linked dealings

Derived from sanctions tier, FATF listing, World Bank WGI governance and CPI; no per-sector dataset is asserted.

Iran: analysis

Iran's profile combines an exceptionally weak governance picture with FATF blacklisting and a comprehensive sanctions regime. Governance is driven by corruption (severe), voice and accountability (severe), and rule of law and institutions (elevated), all of which are severely elevated. Political stability (elevated) is the relatively least-adverse domain but remains high. The CPI reading and a position in the lowest third of the World Bank governance indicators confirm a deeply deficient institutional environment. Multiple sanctions programmes are in force, including the comprehensive US OFAC Iran embargo, EU restrictive measures, UK Iran (Sanctions) Regulations, and UN proliferation measures. Business with Iran is effectively prohibited for most regulated firms.

Outlook

Iran's risk outlook is negative. FATF countermeasures remain in force and there is no indication of imminent removal from the black list. Comprehensive sanctions significantly constrain any legitimate financial exposure. Firms must apply the highest level of scrutiny to any transaction or relationship with a nexus to Iran, including indirect exposure through third-party jurisdictions.

Key watchpoints

• Any FATF black-list review outcomes and the status of countermeasures at future plenaries.
• Changes to the OFAC, EU, UK, or UN sanctions programmes, including any new designations or sectoral expansions.
• Indirect Iran exposure through correspondent banking chains, trade finance, or intermediary jurisdictions.
• Proliferation financing risk, given the UN proliferation measures in force.

Assessment currency

• FATF status: Call for action: countermeasures (as of 19 Jun 2026)
• Sanctions exposure: Comprehensive programme in place (as of Jul 2026)
• Governance (WGI): Latest dataset incorporated (as of 2024)
• Corruption (CPI): 23/100 (as of 2025)
• RegActions assessment: Reviewed (as of 19 Jun 2026)

Public evidence layer

FATF action: countermeasures. FATF calls for countermeasures proportionate to the jurisdiction's risks.

Contextual signals (not scored)

• FATF network membership: No FATF or regional-body membership identified (absent, as of 2026-07)
• EU non-cooperative tax jurisdictions: Not listed in Annex I (absent, as of 2026-02-17)
• Egmont Group FIU: No Egmont member FIU identified (absent, as of 2026-07-17)
• Beneficial-ownership register: No live register identified in the source (unavailable, as of 2026-08-23)
• Transparency International CPI: 23/100, rank 153 (present, as of 2025)

Evidence freshness

• FATF monitored-jurisdiction status: current; data 2026-06-19
• FATF mutual evaluation and follow-up ratings: current; data 2026-08-24
• World Bank governance indicators: current; data 2024
• UN, UK, EU and US sanctions regimes: current; data 2026-08-30

Contextual signals are public evidence only and do not change the current country-risk score.

Download evidence PDF · CSV · JSON

Contextual risk evidence (not scored)

These eight evidence families provide context only. They do not change the v3.1 headline score. Unavailable means no reviewed, country-comparable evidence is currently ingested; it does not mean the risk is absent.

• Organised crime: Not available. No reviewed country-level organised-crime dataset is currently checked in; no risk value is inferred. Candidate sources are research leads only; they have not been ingested as evidence.
• Fraud and cybercrime: Not available. No reviewed country-level fraud or cybercrime dataset is currently checked in; no risk value is inferred. Candidate sources are research leads only; they have not been ingested as evidence.
• Terrorism and proliferation financing: Not available. No reviewed country-comparable terrorism/proliferation threat dataset is currently checked in; FATF listing status remains a separate overlay. Candidate sources are research leads only; they have not been ingested as evidence.
• Trafficking: Not available. No reviewed country-level trafficking dataset is currently checked in; no risk value is inferred. Candidate sources are research leads only; they have not been ingested as evidence.
• Financial secrecy and offshore exposure: Not available. No reviewed, licence-clean financial-secrecy index is currently checked in; jurisdiction type alone is not used as a proxy. Candidate sources are research leads only; they have not been ingested as evidence.
• Tax cooperation: Not listed in EU Annex I. Annex I is a political/legal tax-cooperation list, not a general AML, corruption, or country-risk score. Source
• Political stability and conflict: 39/100 WGI percentile. WGI is an institutional perception indicator, not a conflict event feed or a prediction of future violence. Source
• Beneficial ownership: Not available. The Open Ownership map is a live-register snapshot and absence means no register was identified in that snapshot, not that no register exists. Candidate sources are research leads only; they have not been ingested as evidence.

Regional peer scores

• Syria: 7.0/10 (Very high)
• Yemen: 7.0/10 (Very high)
• Palestine: 6.3/10 (High)
• Lebanon: 6.2/10 (High)
• Iraq: 6.0/10 (High)
• Kuwait: 5.6/10 (High)

Source: FATF black & grey lists · World Bank WGI (CC BY 4.0 — World Bank WGI) · TI CPI (CC BY-ND 4.0 — Transparency International, display only)