The Financial Action Task Force (FATF) has decided to keep Pakistan on its grey list until February 2021. Pakistan has made great progress to tackle the issues of money laundering and terror financing and successfully complied with 21 out of 27 points of action, the watchdog's president said on Friday.
The decision was announced by FATF President Marcus Pleyer at a virtual press conference held after the body's three-day plenary session came to an end today. During the session that started on October 21, the global anti-graft watchdog assessed Pakistan’s progress on the 27-point action plan for addressing anti-money laundering and terror financing.
“Pakistan has to do more,” said the FATF President. "To date, Pakistan has made progress across all action plan items and has now largely addressed. As all action plan deadlines have expired, the FATF strongly urges Pakistan to swiftly complete its full action plan by February 2021."
After concluding the session today, the financial watchdog issued a statement to address Pakistan's case:
"Pakistan’s continued political commitment has led to progress in a number of areas in its action plan, including: taking action to identify and sanction illegal MVTS, implementing cross-border currency and bearer negotiable instruments controls, improving international cooperation in terrorist financing cases, passing amendments to the Anti-Terrorism Act to increase the sanctioning authority, financial institutions implementing targeted financial sanctions and applying sanctions for AML/CFT violations, and controlling facilities and services owned or controlled by designated persons and entities."
"To date, Pakistan has made progress across all action plan items and has now largely addressed 21 of the 27 action items. As all action plan deadlines have expired, the FATF strongly urges Pakistan to swiftly complete its full action plan by February 2021," the statment added.
The statement also mentioned the four key areas that the country has to work on to address strategic deficiencies:
- demonstrating that law enforcement agencies (LEAs) are identifying and investigating the widest range of terror financing activity, which target designated persons and entities, and those who act on the behalf/direction of the designated persons or entities
- demonstrating that terror financing prosecutions result in effective, proportionate, and dissuasive sanctions
- 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 non-profit organizations; identifying and freezing assets, and prohibiting access to funds and financial services
- demonstrating enforcement against violation of terror financing sanctions, including in relation to NPOs, of administrative and criminal penalties, and provincial and federal authorities cooperating on enforcement cases
Shortly after the decision was announced Minister for Industries and Production Hammad Azhar took to Twitter to share his thoughts:
“Pakistan has achieved impressive progress on its FATF action plan. 21 out of 27 action items now stand cleared. Remaining 6 rated as partially complete. Within a year, we progressed from 5/27 to 21/27 completed items. FATF acknowledged that any blacklisting is off the table now.”
Azhar also congragulated the federal and provincial teams for acheiving their respective goals despite the pandemic outbreak:
"Instead of current Action Plan, discussions remained focused on how Pak can be facilitated for our upcoming 2nd evaluation (MER), due mid next year. I congratulate our Federal and Provincial Teams who have worked day and night even during the pandemic to ensure this turn around."
Pakistan was placed on the FATF grey list in June 2018 for taking inadequate measures to stop meony laundering and terror financing and was given a plan of action to complete by October 2019 or face the risk of being placed on the blacklist along with Iran and North Korea.
In October 2019, the FATF decided to keep Pakistan on its grey list till February, giving it time to implement the 27-point action plan. The task force gave Islamabad directives to take more measures for complete elimination of terror financing and money laundering while expressing serious concerns over the lack of progress in addressing terror financing risks.
The FATF met again in January this year in Beijing where Pakistan provided a list of actions taken to implement the action plan.
Later in Feburary, Pakistan received another extension for four month on the “grey list”. The FATF was scheduled to asses country's progress in June 2020, however, the plenary assesment was cancelled due to global pandemic and Pakistan got more time to take neceassry steps. During this period, Pakistan passed 15 new laws to curb the money laundering.