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‘Pakistan Needs Aggressive Diplomatic Effort before FATF Plenary and Working Group Meetings in Miami from June 16 to 21’

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ISLAMABAD: Pakistan needs to launch an aggressive diplomatic effort, apart from technical compliance, over the next four weeks to secure enough support and votes to exit the grey list of the Financial Action Task Force (FATF), says DAWN in an exclusive report.

Pakistan requires about 15 to 16 votes to move out of the grey list and a minimum of three votes to avoid falling into the blacklist. The FATF currently comprises 36 members with voting powers and two regional organisations, representing most of the major financial centres in all parts of the globe.

China is set to secure FATF presidency next year while Saudi Arabia representing the Gulf Cooperation Council is to become a full FATF member. Turkey was the only member that stood by Pakistan despite a strong adverse campaign launched by the US, UK, India and Europe.

Quoting a senior government official, it said the FATF Plenary and Working Group meetings in Orlando, Florida (June 16-21) – after a ‘Face-to-Face meeting’ of the Asia-Pacific Group (APG), a regional affiliate of the FATF, in Guangzhou, China last week – would be crucial for Pakistan to get rid of the grey list or fall into the black list having serious economic reper­cussions. The formal announcement about Pakistan’s future would come out at the next FATF plenary due in Paris on October 18-23.

According to the official, Pakistan is now fully compliant with the related United Nations resolutions, said the official who was part of the Pakistani delegation to.

Pakistan has taken aggressive steps over the last two months in terms of regulatory and monitoring mechanism to meet the FATF requirements and its legal system is generally up to the mark, except some amendments to the Anti-Money Laundering Act (AMLA) 2010 pending before the National Assembly’s standing committee on finance and revenue.

The FATF plenary had formally placed Pakistan in the grey list in June 2018 due to ‘strategic deficiencies’ in its AML/CFT regime after the country could not secure a minimum of three votes as its friends had their own political targets to secure in the global watchdog.

Pakistan submitted a progress report at the Guangzhou meeting and had to respond to questions from the APG members to clarify certain things. The APG would now submit its findings, based on Pakistan’s report and question-answer session, to the FATF in its June 16-21 Plenary and Working Group meetings in the United States.

The government has recently revised its national risk assessment of the corporate sector, strengthened customs procedures on borders and inland movement of funds and assets and put nine more entities on the list of proscribed organisations. Internal control of the banking and non-banking financial institutions, insurance companies and stock exchanges has been strengthened to curb the possibility of money laundering and terror financing. The account opening is now subject to additional checks and scrutiny and existing accounts are being biometrically verified.

Pakistan has recently created a specialised directorate of Cross Border Currency Movement (CBCM) to maintain a database of currency seizures and suspicious transactions.

Also, the Data and Risk Analysis Cell has been created to conduct regular analysis of data pertaining to currency seizures, currency declarations, banking transactions and benami acc­ounts, and continuously update mea­sures to combat money laundering.

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