Pakistan striving to come out of FATF grey list

Islamabad, Oct 6, IRNA - Pakistan government has been striving hard to come out of the Financial Action Task Force (FATF) grey list so that its financial system could not be affected.

The FATF placed Pakistan on its grey list after a meeting in Paris on June 28. Pakistan was placed on the list of countries involved in providing monetary assistance to terrorism and other related causes. Pakistan was also on the FATF grey list between 2012 and 2015.

The FATF, an intergovernmental body of 37 full member countries, sets global standards for fighting illicit finance. Pakistan is its associate member and is part of its affiliate body Asia-Pacific Group (APG).

The decision came despite Islamabad showing progress in the majority of areas identified as threat the international terror financing watchdog.

The global body took the decision on the basis of a monitoring report of the International Cooperation Review Group (ICRG).

Pakistan has already submitted its plan to chalk out money-laundering, corruption and terror financing thus avoiding an immediate inclusion into the blacklist.

Pakistan foreign office had ruled out chances of Pakistan being blacklisted by the FATF while restating the country would remain on the inter-governmental body’s ‘grey list’.

Though Pakistan did proscribe core groups by seizing their assets, it does not meet the high bar set by FATF.

Former Pakistan’s finance minister Dr. Hafeez Ahmed Pasha talking to IRNA said that Pakistan has to fulfill all the requirements of the FATF to come out of the organization’s grey list.

Senior economist said that Pakistan has to fully implement anti-money laundering laws as par the standards of the FATF.

'IMF in last meeting with Pakistan has also emphasized on the implementation of the requirements of the FATF,' former United Nations Assistant Secretary General added.

Ex-United Nations Development Program Assistant Administrator noted it is now becoming a very big issue of Pakistan.

Dr. Hafeez Pasha said that may be when Pakistan goes to the IMF it would ask the country to first get certification from the FATF.

“This is the first time that such issue has been mentioned in the program of the IMF,” said the economist.

He added that according to some reports $10 billion of money-laundering takes place from Pakistan annually. Former minister said that if Pakistan could stop this amount from money-laundering it would certainly help the country to improve its economy.

He said that our implementation record regarding money laundering laws is not very strong but now we have to give special focus to this matter.

The economist was of the view that if Pakistan remains in the FATF grey list it would be impossible for the country to get the international financial support and that would be a disaster for Pakistan.

Pakistan has been placed among the jurisdictions (states) with strategic deficiencies Ethiopia, Serbia, Sri Lanka, Syria, Trinidad and Tobago, Tunisia and Yemen.

The 26-point action plan presented by Pakistan to the 37-nation FATF plenary will have to be implemented within the next 15 months in order to avoid being blacklisted.

After its placement on the ‘grey list’, the country will be directly scrutinized by the financial watchdog until it is satisfied by the measures taken to curb terror financing and money-laundering. Pakistan will have to deliver on the first goal by January next year and complete all the 26 actions by September 2019.

Renowned Pakistani economist and former provincial advisor Dr Qaiser Bengali talking to IRNA said that Pakistan should make sure that there is nothing happening in the country which is violation of international law.

He said that Pakistan must ensure implementation of all the laws and everybody in Pakistan follows the international or national law.

The economist went on to say sanctions or penalties of different level can be imposed on Pakistan either it remains on the grey list or black listed.

“If it comes out of it obviously there are no sanctions and no penalties of any kind, one would hope that Pakistan will come out of this situation,” Dr Qaiser Bengali added.

Earlier the British High Commissioner to Pakistan Thomas Drew had said the United Kingdom is ready to help Pakistan come out of the grey list of the Financial Action Task Force (FATF).

“Pakistan has done very well during the last five months on the issue of FATF. We are investing to help Pakistan to meet criteria of FATF,” he added.

To comply with 40 recommendations of the Financial Action Task Force (FATF), Pakistan’s key institutions have come up with a comprehensive plan by devising some suggestions for avoiding further down gradation.

They said money laundering and terrorist financing risks are understood and, where appropriate, actions must be coordinated domestically to combat money laundering and the financing of terrorism and proliferation.

They said supervisors appropriately supervise, monitor and regulate financial institutions for compliance with Anti-Money Laundering (AML) and Combating the Financing of Terrorism (CFT) acts.

They added financial institutions adequately apply AML/CFT preventive measures commensurate with their risks, and report suspicious transaction.

They added financial intelligence and all other relevant information should be are appropriately used by competent authorities for money laundering and terrorist financing investigations and money laundering offence and activities should be investigated and offenders are prosecuted.

They said terrorists, terrorist organizations and financiers should be prevented from raising, moving and using funds, and form abusing the non-profit organizations (NPO) such as NGOs sector.

They said persons and entities involved in proliferations are prevented from raising, moving and using funds in accordance with the relevant United Nations Security Council resolutions.

Former finance minister Miftah Ismail, while addressing the National Assembly in March this year, had said that being placed on the grey list would not affect the economy and only cause 'embarrassment' to the country.

Meanwhile according to reports Pakistan and Financial Action Task Force’s Asia Pacific Group would hold a meeting in Pakistan from October 7th till 19th.

The visiting delegation would meet the foreign minister, interior minister, as well as the heads of State Bank of Pakistan, Financial Monitoring Unit, Securities and Exchange Commission of Pakistan, Federal Investigation Agency and other law enforcement agencies during their 13-day stay in Pakistan.

The meetings will review cases of money laundering and terror financing in Pakistan and make recommendations for measures to identify domestic and foreign transactions.

During its visit, the FATF delegation will make recommendations on whether to remove Pakistan from its grey list or to add it to the blacklist.

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