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Wednesday, May 22, 2024

Anti-Money Laundering Act: 149 notices in response to 767 complaints issued

Asim Ahmad, the chairman of the Federal Board of Revenue, has informed the Senate Standing Committee on Finance and Revenue that the tax agency has issued 149 notifications on 767 complaints totaling Rs358 billion under the Anti-Money Laundering Act.

The Senate Standing Committee on Finance was informed by the Federal Board of Revenue (FBR) on Wednesday that since 2016, 254 notices involving Rs358 billion had been sent in response to 767 allegations of alleged money laundering.

The senators interrogated the FBR about sending letters based only on charges of tax evasion rather than their requirement that notices be sent primarily on suspicions of money laundering. During the proceedings of the Senate panel, Senator Mohsin Aziz of the PTI remarked that the money laundering notices were comparable to a death warrant.

On Wednesday, the committee met under the direction of Senator Saleem Mandviwalla, and FBR Chairman Asim Ahmed stated that in the previous six years, the FBR had only made five arrests on these charges and never without substantial evidence. He gave the transaction of Rs. 46 billion made by one salaried employee as an example, adding that he might be engaged in currency trading. The senators opposed it and stated that they did so because they believed the Anti Money Laundering (AML) legislation would be abused.

The Anti-Money Laundering Act notices that the FBR sent to enterprises were the subject of discussion by the committee. Asim Ahmad briefed the committee that after receiving confirmation from a third party, notices were issued following allegations of suspicious transactions being sent by the Financial Monitoring Unit (FMU).

Read More: FBR faces more than 70,000 cyber attacks every month

The Act only permits transactions worth Rs. 10 million or more. Mandviwalla asserted that tax evasion laws should be used to probe the matter of questionable transactions rather than the Act. The committee instructed the FBR to use the referred case as a test case and gave it the go-ahead to be cautious when reviewing all the cases brought up by the FMU.

The committee was also informed that the federal government has withdrawn its appeals against the Federal Shariat Court’s ruling on interest and riba.

Every political party has stated a desire to abolish interest and riba, according to State Minister for Finance and Revenue Aisha Ghaus Pasha, and the SBP is developing a transformational plan that will be put into action over the next few years. The goal of the plan was not a complete financial system transition. She added that it was restricted to specific windows and goods.

Mandviwalla informed the ministry that the Bank of China and other foreign banks expressed their concerns in a letter and urged the ministry to address them. Bank representatives stated that the cellular companies had been instructed to submit their contract documents by December 31 in order to establish misuse and violation outside of their mandate during discussion on the issue of Google payments being stopped by the SBP.