Israel Country Summary
Sanctions
Arab League
FATF AML Deficient List
No
Terrorism
Corruption
US State ML Assessment
Criminal Markets (GI Index)
EU Tax Blacklist
Offshore Finance Center
Please note that although the below Summary will give a general outline of the AML risks associated with the jurisdiction, if you are a Regulated entity then you may need to demonstrate that your Jurisdictional AML risk assessment has included a full assessment of the risk elements that have been identified as underpinning overall Country AML risk. To satisfy these requirements, we would recommend that you use our Subscription area.
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Anti Money Laundering
FATF status
Israel is not currently on the FATF list of Countries that have been identified as having strategic AML deficiencies.
Compliance with FATF Recommendations
The last follow-up Mutual Evaluation Report relating to the implementation of anti-money laundering and counter-terrorist financing standards in Israel was undertaken in 2022. According to that Evaluation, Israel was deemed Compliant for 16 and Largely Compliant for 19 of the FATF 40 Recommendations. It was deemed Highly Effective for 3 and Substantially Effective for 5 of the Effectiveness & Technical Compliance ratings.
Sanctions
Israel, as a UN member, must adhere to sanctions imposed by the United Nations to maintain international peace and security. The UN Security Council has established 31 sanctions regimes since 1966, which include economic sanctions and targeted measures like arms embargoes and travel bans. Currently, there are 15 ongoing sanctions regimes focusing on political settlements, nuclear non-proliferation, and counter-terrorism, with a Consolidated List for individuals and entities affected by these measures.
Following the invasion by Hamas fighters into Israel on October 12, Israel initiated a total siege on Gaza, blocking essential supplies. Additionally, the Arab League has implemented a systematic boycott against Israel, prohibiting the importation of Israeli goods and services and restricting business engagements with entities that operate in Israel. This boycott has varied in its enforcement among member states.
Bribery & Corruption
| Rating | 0 (bad) - 100 (good) |
|---|---|
| Transparency International Corruption Index | 62 |
| World Bank: Control of Corruption Percentile Rank | 79 |
Corruption in Israel is illegal and actively combated by various governmental bodies, with the country ranking 33rd in Transparency International's 2023 Corruption Perceptions Index. While businesses may encounter demands for bribes, corruption is not institutionalized, and the legal framework is robust, leading to successful prosecutions of high-ranking officials. However, the OECD has raised concerns about Israel's lack of proactive measures in investigating foreign bribery, despite recent positive developments such as the establishment of an Inter-Ministerial Team to enhance enforcement.
Economy
Israel's economy is characterized by a strong entrepreneurial spirit and a highly educated workforce, making it a leader in innovation across various sectors. Despite facing significant challenges due to recent conflicts, including a sharp GDP decline of 20.7% in late 2023, the economy showed signs of recovery with a 3.35% growth in early 2024, supported by a robust high-tech sector and substantial foreign investment, particularly from the United States.
Israel's investment climate is characterized by a strong openness to foreign investment, supported by government initiatives such as the 'Invest in Israel' program, which facilitates foreign capital inflow and provides guidance on local regulations. The country boasts a vibrant high-tech sector and a robust venture capital landscape, with significant participation from U.S. firms in research and development. Despite challenges such as trade barriers and monopolies in certain sectors, Israel continues to attract substantial foreign direct investment, particularly in technology and innovation.
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- Risk Analysis
- Corruption
- Economy
- Sanctions
- Narcotics
- Executive Summaries
- Investment Climates
- FATF Status
- Compliance
- Key Findings
