The Financial Action Task Force (FATF) committee is to meet once again to evaluate Pakistan’s compliance with the recommendations of the anti-money laundering watchdog. Pakistan expects to come out of the grey list. However, some diplomats and senior officials are of the view that the country may continue to remain in the increased monitoring list (grey list) until June.
Despite politicization of the issue, Pakistan has internalized FATF Recommendations in its legal and administrative systems in shortest possible time.
FATF meets today https://t.co/3VYlqVSdkr @rsilpak @FATFNews @UNODCPakistan @SECPakistan @StateBank_Pak
— KamranAdil (@KamranAdilPSP) February 22, 2021
A final decision would be announced by the FATF president on the conclusion of the four-day virtual plenary on Feb 25.
Ahead of the plenary, the FATF updated the overall performance of all countries. Based on this update, Pakistan has been shown to improve compliance on two out of 40 recommendations of the FATF on the effectiveness of anti-money laundering and combating financing terror (AML/CFT) systems. It finds Pakistan’s progress non-compliant on four counts, partially compliant on 25 counts, and largely compliant on nine recommendations. Pakistan’s evaluation at the plenary would be based on the 27-point action plan and not on these 40 recommendations.
There are, however, no chances that Pakistan could be put in the blacklist because it has at least three members of the FATF — China, Turkey and Malaysia — who can sustain all pressures against any downgrade.
Pakistan fully complied with 21 out of 27-point action plan last year, leading the FATF to soften its stance from previously aggressive threats and yet it kept it in the grey list in October last year. Following robust progress on anti-money laundering and terror financing laws, rules, regulations and updating inter-agency and inter-provincial cooperation, the FATF narrative shifted towards Islamabad to “demonstrate” seriousness on ground through results and prosecutions.
Government established a new Cell
The PTI-led government has established a special unit within the Federal Board of Revenue (FBR) to ensure “timely completion of the FATF action plan” proposed for Pakistan.
The government has constituted a special unit of the FBR to implement and monitor the implementation of the directives issued by the Financial Action Task Force in its review of Pakistan’s compliance with the proposed measures to curb terror financing and corruption.
What are the 6 FATF points that Pakistan still has to comply with?
What exactly are the 6 FATF points that Pakistan still has to comply with? Nobody seems to know according to a tweet by a renowned journalist. In the Tweet, it is said:
Anyone know the specific 6 points Pakistan has failed to correct for FATF? It appears that @FinMinistryPak @Hammad_Azhar have no knowledge and can only point to FATF website (mentioning 4 general areas) 😡 Seriously – do you actually even know? Is that why we are still in FATF?
— Najma Minhas (@MinhasNajma) October 31, 2020
Pakistan should continue to work on implementing its action plan to address its strategic deficiencies, including by: (1) demonstrating that law enforcement agencies are identifying and investigating the widest range of TF activity and that TF investigations and prosecutions target designated persons and entities, and those acting on behalf or at the direction of the designated persons or entities; (2) demonstrating that TF prosecutions result in effective, proportionate and dissuasive sanctions; (3) demonstrating effective implementation of targeted financial sanctions against all 1267 and 1373 designated terrorists and those acting for or on their behalf, preventing the raising and moving of funds including in relation to NPOs, identifying and freezing assets (movable and immovable), and prohibiting access to funds and financial services; and (4) demonstrating enforcement against TFS violations, including in relation to NPOs, of administrative and criminal penalties and provincial and federal authorities cooperating on enforcement cases.
#FATF must explain its position why %India is lobbying the international body to be biased against Pakistan as Delhi is?
FATF is fast becoming a geo-political tool to arm twist Pakistan 4
— Jan Achakzai / جان اچکزئی (@Jan_Achakzai) May 4, 2019
It is important to note that analysts across the world have accused the FATF of harboring bias, and being a geo-strategic tool of the powerful, and the presence of the Indian lobby makes the accountability process all the more dubious for Pakistan.