Pakistan prepares FATF compliance report as it awaits decision on 'grey list' status

Islamabad, PakistanUpdated: Oct 10, 2019, 05:44 PM IST
main img

File photo of Pakistan PM Imran Khan. Photograph:(AFP)

Story highlights

The FATF review had placed Pakistan into the grey list in June 2018 and had given 27 action plans till September 2019 to comply for coming out from the grey list.

Pakistan has prepared its compliance report for the Financial Action Task Force's (FATF) crucial plenary meeting that is scheduled to be held in Paris from October 12 to October 15, during which the global anti-money laundering watchdog will give its decision on the country's 'grey list' status.

FATF had placed Pakistan on its 'grey list' in June 2018, giving it a 15-month action plan to complete implementation of a 27-point action plan, failing which the country could be placed in the Black List.

The forthcoming review of its performance will determine if it stays on the grey list or moved on the blacklist or given a clean chit.


In its latest report titled Mutual Evaluation Report of Pakistan, the Asia Pacific Group (APG) of the FATF on Saturday had said chances are high that Pakistan will be retained on the 'grey list' as the country had failed to take sufficient measures to fully implement UNSCR 1267 obligations against 26/11 mastermind Hafiz Saeed and other individuals associated with LeT, JuD, FIF, among other terror groups.

"Pakistan should adequately identify, assess and understand its ML (Money Laundering)/TF (Terror Financing) risks including transnational risks and risks associated with terrorist groups operating in Pakistan such as Da'esh, AQ, JuD, FiF, LeT, JeM, HQN, and this should be used to implement a comprehensive and coordinated risk-based approach to combating ML and TF," the report stated.

The Pakistani delegation, led by Minister for Economic Affairs Division Hammad Azhar, is scheduled to leave for France on October 13 as Pakistan's case will be taken up on October 14 and 15, the Dawn reported.

Pakistani authorities have insisted that they made constructive efforts for improving compliance level by the regulated entities.

A report finalised by the Securities and Exchange Commission of Pakistan (SECP) on Wednesday has said that the comprehensive guideline developed by the Commission has helped financial institutions to generate 219 Suspicious Transactions Reports (STRs) in one year, as compared to 13 STRs in eight years.

To align itself with the FATF`s standards and its 40 recommendations, the Commission developed a set of regulations in June 2018.

The SECP has conducted 167 inspections, focusing on anti-money laundering, combating the financing of terrorism compliance in the cases of 72 securities brokers, 27 non-banking financial companies, 13 insurance companies and 55 high-risk non-profit organisations.

The report added that apart from penalties imposed for non-compliances with the said regulations, the financial institutions have also undertaken remedial measures to ensure effective compliance with the regulations.

It said automated screening software has been deployed by many financial institutions to screen the proscribed persons and the regulated entities now also have access to the Go AML system of the State Bank of Pakistan`s (SBP) Financial Monitoring Unit (FMU) for online filing of STRs.

Pakistan Prime Minister Imran Khan on Tuesday morning arrived in China for a three-day visit, a week ahead of the FATF plenary meeting.

Islamabad has been engaged in hectic lobbying in a last-ditch bid to influence the outcome in its favour. This year, Pakistan all-weather ally China holds the presidency of the FATF.

It is highly anticipated that Islamabad will ask Beijing to stridently back it at the plenary meeting to prevent it from blacklisting.