Thursday, 23 March 2023

FATF maintains ‘grey’ status for Pakistan even after significant progress

The Financial Action Task Force (FATF) on Thursday placed Pakistan on its gray list despite acknowledging the country’s significant progress.

A statement from the FATF stated that “As soon as all the deadlines of the Action Plan have expired, the FATF urges Pakistan to expedite its completion of the Action Plan by June 2021.”

The FATF notes significant progress on the entire Action Plan. According to the note, “To date, Pakistan has made progress on all action plan items and has now addressed 24 of the 27 action items extensively,” according to the note.

Since June 2018, when Pakistan has teamed up with the FATF and APG to strengthen its AML / CFT government and address its shortcomings in counter-terrorism financing. Demonstrated a high level of political commitment to Pakistan, then significant progress has been made as a result of Pakistan’s continued political commitment. A comprehensive CFT strategy, including demonstrating that: Law enforcement agencies are identifying and investigating the broadest range of TF activities, demonstrating compliance with TF violations, and funding Working to increase and prevent it, including controlling proprietary or managed facilities and services.

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Key Shortcomings in FATF Action Plan

Pakistan should continue to work on the implementation of the remaining three items in its action plan to address key shortcomings in its strategy. (1) Demonstrate that TF investigations and prosecution target individuals and entities who act on behalf of or under the direction of designated individuals or entities. (2) Demonstrating that legal action against TF results in effective, proportionate and non-binding sanctions. (3) Demonstrate effective enforcement of targeted financial sanctions against all 1267 and 1373 designated terrorists, in particular those against them or those acting on their behalf.


What does the FATF do?

The Financial Action Task Force (FATF) is an inter-governmental policy making body whose purpose is to establish international standards, and to develop and promote policies, both at national and international levels, to combat money laundering and the financing of terrorism.

Is Pakistan member of FATF?

The FATF placed Pakistan on the grey list in June 2018 and asked Islamabad to implement a plan of action to curb money laundering and terror financing by the end of 2019, but the deadline was extended later on due to Covid-19 pandemic.

What is FATF GREY list?

The countries added to the grey list are Morocco, Burkina Faso, Senegal and the Cayman Islands. With the four additions, the list now has 19 countries and territories that FATF said were only partially fulfilling international rules for fighting terrorism financing and money laundering.

What happens if a country is blacklisted by FATF?

It is extremely likely that blacklisted countries will be subject to economic sanctions and other prohibitive measures by FATF member states and other international organizations. … While it has no direct investigatory powers, the FATF monitors global AML/CFT regimes closely to inform the content of its blacklists.

What will happen if Pakistan is blacklisted in FATF?

Pakistan’s Prime Minister Imran Khan has warned. That if Pakistan is blacklisted at the FATF or Financial Action Task Force. Then Pakistan’s economy will be destroyed due to inflation and a massive fall in Pakistani Rupee. … Once we are on theblacklist, our entire economy will be destroyed due to inflation.”


FATF | Financial Action Task Force | Anti Money Laundering | AML |

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