Money Laundering in Panama Over: Panama Removed from Gray List
The European Commission has confirmed that money laundering in Panama is no longer a problem. The country has been removed from the European Commission’s list of high-risk countries for financial crime. This provides valuable reassurance for investors and anyone wanting to do business in Panama.
On June 10, 2025, a press release from the European Commission announced that several countries, including Panama, were delisted from its list of high-risk countries for money laundering (sometimes called the “gray list”). It explains that the list updates are a result of action taken by the Financial Action Task Force (FATF), a global organization dedicated to reducing the prevalence of money laundering and other financial crimes around the world.
Panama’s efforts to be delisted from the European Commission’s gray list for financial crime started several years ago, in October 2020.
What is the History of Money Laundering in Panama?
Panama was known to be a high-risk destination for investing because of its high incidence of money laundering since at least the 1970s. The country began to be known (and used) as a tax haven decades earlier, however, in 1919. That was when it helped Standard Oil evade U.S. taxes by registering the company in Panama.
This is why, until this year, Panama had been considered a high-risk country for financial crime because of its lax laws and regulations governing financial institutions and corporations. As the BBC reports, offshore finance in Panama “took off in the 1970s as world oil prices surged.” After that, Panama made legislative changes that created even more financial secrecy for corporations and wealthy individuals.
Panama took decisive steps to fix the legal and regulatory loopholes that had made financial crime so easy to commit in its jurisdiction. The Rio Times reports that “Authorities created a central registry to track who really owns companies and forced banks to report suspicious activity.” The Panamanian government enacted Law 23 of 2025, which made great strides towards drastically reducing the risk of money laundering (including terrorism financing) on its shores.
These changes were highly effective. In fact, it was through these efforts that the Financial Action Task Force decided to remove Panama from its list of countries considered high-risk for financial crime and money laundering in 2025.
What is Panama’s Connection to Money Laundering?
Panama used to have a bad reputation for money laundering. As a result, many investors hesitated to do business there. However, the country made significant legislative and regulatory changes in 2025. This convinced the Financial Action Task Force that Panama has acceptable financial transparency and is safe for investors. This move by the FATF allowed the European Commission to remove Panama from its gray list.
Panama was once on the European Union’s tax evasion and financial crimes black list, which is more serious and punitive than the gray list. The country was also on the U.S. Department of State’s tax haven blacklist.
Are Panama Banks Involved in Money Laundering?
No, Panama’s banks aren’t involved in money laundering. It was after the Panama Papers controversy in 2016 that the Panamanian government recognized the need to create better financial transparency. It decided to address the country’s tax evasion and money laundering problems.
The Panama Papers controversy caused Panama to be put on international watchlists. It was included on the European Commission’s high-risk financial crime countries list. That meant that European financial institutions faced significant roadblocks in working with businesses and banks in Panama. Since then, Panama has taken decisive steps to improve its transparency, regulatory structure, and reputation.
Frequently Asked Questions: Money Laundering in Panama
Is Panama on a black list?
No, Panama isn’t on a black list. However, until June 2025, Panama was on something referred to as a “gray list,” which was the European Commission’s list of countries with a high risk of financial crime (such as money laundering). In June 2025, Panama was removed from this list because of the legislative and regulatory changes it made.
Is money laundering in Panama a problem?
No, money laundering is no longer a problem in Panama. Money laundering used to be a significant problem in Panama, but recent legal and regulatory changes have transformed the situation. In fact, the Financial Action Task Force (FATF) and the European Commission have both recognized these changes. Panama is no longer included on the European Commission’s gray list. As The Rio Times has reported, the fact that Panama is no longer on the high-risk list means that it “has regained the trust of Europe’s financial regulators.” This is an enormous step forward in the way this country is seen on the world stage.
Is Panama safe for real estate investors?
Yes, Panama is safe for real estate investors. In the past, real estate investors hesitated to invest in Panama because of the danger of inadvertently getting mixed up in a money laundering scheme, which could mean serious legal consequences. That is why Panama being delisted from the European Commission’s gray list is a significantly positive new development. With the country now being acknowledged for acceptable financial transparency and a safer investment environment, it’s much easier to do business in Panama without worry.
Is Panama a high-risk country for money laundering?
No, Panama isn’t a high-risk country for money laundering. It was considered risky in the past, but this changed when Panama enacted Law 23 of 2025, which significantly reduced the risk of money laundering in its jurisdiction. Also, the country’s efforts were recognized by the Financial Action Task Force (FATF) and was removed from the European Commission’s gray list.
Is there money laundering at Panama banks?
No, money laundering is not allowed at Panama banks. While there used to be a high risk of money laundering in Panama banks, that is no longer true. Panama’s Law 23 of 2025 transformed the situation.
Law 23 of 2025 demonstrated Panama’s new policies and regulations to prevent money laundering. It was because of this that the Financial Action Task Force (TATF) recognized the country’s efforts. As a result, the European Commission removed Panama from its list of high-risk countries.
Why do people put money in Panama?
People put money in Panama because of its exciting investment opportunities, such as real estate and infrastructure projects. Also, Panama has recently been removed from the European Commission’s gray list. That means it’s no longer considered a high-risk country for money laundering and other financial crimes. This gives potential investors greater peace of mind.
