On Thursday, Pakistan’s Foreign Minister said it is expected for Pakistan to get delisted from FATF’s grey list at its next plenary meeting. The global money laundering and terrorist financing watchdog had decided to keep the country on the grey list till February despite progress by Pakistan on meeting international anti-terrorism financing norms. The Financial Action Task Force has urged the country to swiftly finalize an internationally agreed action plan by February 2021.
FATF’s next plenary meeting is scheduled to take place virtually from Feb 22 to 25. While briefing the Senate Foreign Affairs Committee, Qureshi said that he hopes FATF would refrain from taking any politically motivated decision. Senator Mushahid Hussain Sayed was the one chairing the meeting.
FATF urges Pakistan to complete Action Plan by Feb
Pakistan has been a part of FATF’s grey list since 2018 owing to the deficiencies in its counter-terror financing and anti-money laundering regimes. In its last meeting held in October, FATF had decided to keep Pakistan on the list of ‘jurisdiction under enhanced monitoring’ till February 2021, when it would once again assess the progress that the country has made with respect to addressing the strategic deficiencies.
27 actions were recommended by FATF, 21 out of which Pakistan has complied with. However, it has failed to take action against the prosecution and conviction of banned individuals and also the organizations associated with the terror groups listed by the UN Security Council. It has also been unsuccessful in dealing with terror financing through narcotics and the smuggling of precious stones.
Shah Mehmood Qureshi is, however, still optimistic and believes that a positive decision would be taken for Pakistan by FATF in its next meeting as they have made substantial progress across all action plan items.
Pakistan’s History’s with the FATF
Pakistan had first appeared in the FATF statement after the plenary meeting of 2008. Back then, FATF had noted the country’s adopting anti-money laundering legislation practices but had urged the government to address the remaining deficiencies that could lead to it having a vulnerable position in the international financial system.
In June 2010, Pakistan guaranteed a high level of commitment and declared that it would work with FATF and Asia-Pacific Group (APG) on Money Laundering to fix these issues. But in vain, as it could not demonstrate enough improvement to be taken out the grey list in October 11, even. A public statement by FATF issued in February 2012 listed Pakistan among countries who have “Jurisdictions with strategic AML/CFT deficiencies that have not made sufficient progress in addressing the deficiencies or have not committed to an action plan developed with the FATF to address the deficiencies”. FATF believed that the country did not have suitable legislation to identify terror financing and confiscate terrorist assets.
In June 2014, Pakistan made its way out of the Public Statement to the second statement of “Improving public compliance” which acknowledged that the country had made a significant progress. And in no more than nine months, Pakistan was no longer subject to the FATF’s monitoring process under its on-going global AML/CFT compliance process”
However, in June 2018, Pakistan was back on FATF’s grey list. The FATF press release read that the ‘action plan’ should focus on plugging the holes in terror financing and activities of UN-designated terrorists. The country then submitted its action plan which includes 27 points aimed at improving its position in the international financial sector.
Currently, Pakistan is concentrating on the implementation of all recently-enacted laws to come out of FATF’s grey list in February.