FATF consensus decision a ‘diplomatic victory’

Federal Industries and Production Minister Hammad Azhar on Saturday maintained that the Financial Action Task Force’s (FATF) consensus decision “without any voting” to give Pakistan another lifeline by keeping it on the global watchdog’s grey list for four more months was a “diplomatic victory” for the country.

A day earlier, Pakistan again avoided being placed on the FATF blacklist as the global dirty money watchdog decided to retain the country in its grey list while acknowledging its political commitment to end deficiencies in the country’s terror financing regime.

The country was unable to exit the FATF grey list as it could not fully implement its 27-point action plan till June 2020 deadline. However, Pakistan made significant progress on 21 points of the plan.

“[The] consensus decision without any voting is our diplomatic victory. Thus, no voting criterion (for any voting numbers) was applied," Hammad Azhar wrote on his official Twitter handle.

"FATF has acknowledged our high-level political commitment and significant progress,” he pointed out.

The minister noted that some circles were propagating "false and baseless information" about abstention or negative voting in the meeting.

"Some countries mentioned in the fake news are not even members of FATF. Pakistan enjoys broad international support and cooperation on FATF.”

On Thursday, the Foreign Office had categorically rejected false media reports about Saudi Arabia’s role in the assessment of Pakistan’s FATF action plan.

“Pakistan and Saudi Arabia enjoy strong fraternal ties and the two countries have always cooperated with each other on all matters of bilateral, regional and international importance,” said Foreign Office spokesperson Zahid Hafeez Chaudhry.

He added that Pakistan greatly valued its relations with the kingdom and firmly rejected such malicious propaganda.

In June 2018, Pakistan had been listed among the 16 jurisdictions under increased monitoring due to strategic deficiencies in their anti-money laundering (AML) and combating financing of terrorism (CFT) framework.

In February this year, the FATF plenary had warned that “all deadlines in the action plan have expired and should significant and sustainable progress, especially in prosecuting and penalising terror financing, not be made by the next plenary, the FATF will take action, which could include the FATF calling on its members and urging all jurisdictions to advise their investors to give special attention to business relations and transactions with Pakistan.

 “The FATF takes note of the significant progress made on a number of action plan items and to date, Pakistan has made progress across all action plan items and has now largely addressed 21 of the 27 action items,” the FATF observed in a statement issued on Friday.

It urged the country to swiftly complete its full action plan by February 2021.

Pakistan took action to identify and sanction illegal MVTS, implementing cross-border currency and BNI controls, improving international cooperation in terror-financing cases, passing amendments to the ATA 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, according to the global body.

However, it still needs to improve its working in many areas, particularly curbing the terror financing.

An official handout stated that “Pakistan should demonstrate that law enforcement agencies (LEAs) are identifying and investigating the widest range of TF [terror financing] activity and that TF investigations and prosecutions target designated persons and entities, and those acting on behalf or at the direction of the designated persons or entities”.

“There is also a need to demonstrate that TF prosecutions result in effective, proportionate and dissuasive sanctions,” said the FATF.

Pakistan also needs to demonstrate effective implementation of targeted financial sanctions against all 1,267 and 1,373 designated terrorists and those acting for or on their behalf, preventing the raising and moving of funds including in relation to NPOs, identifying and freezing assets (movable and immovable), and prohibiting access to funds and financial services.