Pakistan meets all FATF requirements

Anti-money laundering watchdog set to review progress in Paris

ISLAMABAD: Pakistan has taken all the five actions prescribed by the Financial Action Task Force (FATF) ahead of its first review, but India is expected to play the spoiler’s role and may push the case to get tougher on eight proscribed organisations.

The FATF’s plenary meetings would take place from February 17 to 22 in Paris. The global body that is working to combat money laundering and terrorism financing would hold the first review of Pakistan after placing the country on its grey list with effect from June 2018.

Islamabad had been given a 27-point action plan that the country will implement till September 2019.

Pakistan’s case would be presented by the Asia Pacific Group that will report progress on five out of 27 agreed actions, according to the Ministry of Finance officials. The authorities are hopeful that the country will be able to pass through the first milestone.

A Pakistani delegation comprising officials from the Ministry of Finance, Foreign Affairs and Financial Monitoring Unit would leave for Paris at the weekend. The FATF has placed Pakistan on the grey list of countries whose terrorism financing and anti-money laundering laws are described as deficient.

The FATF will review progress in four key areas –Terrorism Financing Risk Assessment report, report of the customs department on cash couriers, implementation on the United Nations Security Council resolutions, and inter-agency coordination. On basis of these four areas, the FATF had identified five actions for the first review of the implementation on the 27 point Action Plan.

Based on an interaction with the Asia Pacific’s Joint Review Group, Pakistan expects that lengthy discussions may take place on Terrorism Financing Risk Assessment report. Out of five actions, three relate to terrorism financing risk assessment.

The risk assessment report has been prepared on the World Bank methodology and has already been approved by the National Executive Committee on Anti Money Laundering (AML).

A coordination committee on the AML and Counter-Terrorism Financing also met last week to finalise responses to the questions raised on the report by the Asia Pacific Group.

Last month, an Indian delegation had raised the issues of Jamaat-ud-Dawa (JuD), Falah-e-Insaniyat Foundation (FIF), Lashkar Taiba, Jaish-e-Mohammed, and four other organisations.

In light of these discussions, the Joint Review Group had sent a questionnaire to Pakistan that primarily revolved around eight proscribed organisations, according to the Finance Ministry officials.

They said India wanted Pakistan to share details of the threat assessment of these organisations. The officials said New Delhi may push the FATF to ask Pakistan share the evidence and actions taken against these organisations. Indians were looking for data that could address their concerns about the activities of these organizations in areas that are near to its borders.

The government officials involved in these discussions believed that Pakistan has done enough and some European countries are also now supportive of its stance. Pakistan has also used diplomatic channels to convince the FATF member countries about its commitments to curb terrorism financing.

The Finance Ministry officials said the terrorism risk report has clearly demonstrated the geographical locations of these organisations and the risk-based approach has been adopted to tackle challenges emanating from these organisations.

They said the second action that relates to proper identification and the nature of risks of cash couriers being used for terrorist financing has also been met. The law enforcement agencies have also taken measures to curb smuggling of cash at international borders, including at the Afghan border.

The third action relates to the assessment and understanding of both domestic and trans-national terrorism financing risks to guide terrorist financing investigations. This was also an area where Indians were focusing, said the officials.

Pakistan is confident on the remaining two actions that relate to targeted financial sanctions regarding asset freezing and ongoing prohibitions to provide funds and financial services and publication of an updated list of persons and entities pro-scribed under the Anti-Terrorism Act and UN-designated entities.

The list is available on the website of National Counter Terrorism Authority (Nacta) website that shows that 67 organizations, splinter outfits have been notified as pro-scribed by Ministry of Interior under the Anti Terrorism Act, 1997. The Al Rahmah Welfare Trust Organisation was also pro-scribed on Dec, 13.

However, the government has to work hard in the remaining 22 actions, particularly related to convictions and prosecutions in the terrorism financing cases. There will be two more reviews in May 2019 and Sept 2019 before the FATF takes a decision on whether to remove Pakistan from the grey list.