FATF: another lifeline

Despite making serious efforts to get rid of the FATF grey list, Pakistan will have to stay on it — at least till February next year. The flip side of the development, however, is that the threat of being relegated to the Paris-based watchdog’s blacklist — which also comprises Iran and South Korea, and which means imposition of global economic sanctions by its 39 member-countries — now clearly appears off the table, as also claimed by Hammad Azhar, the Federal Minister for Industries and Production. In what constitutes appreciation of the government’s efforts, the FATF acknowledged “the significant progress made on a number of action plan items [meant to improve its regime related to anti-money laundering and combatting financing for terrorism]; and to date, Pakistan has made progress across all action plan items and has now largely addressed 21 of the 27 action items”.

Caught in the FATF web since June 2018, Pakistan has taken several major steps in line with the taskforce’s action plan — like carrying out legislation to outlaw terror funding and money laundering; ensuring that foreign currency transactions in the country are not left undocumented; and proscribing several militant groups and seizing their assets. But the country is still required to do more to “address its strategic deficiencies”. To come clean completely, Pakistan has to demonstrate within the next four months that its law enforcement agencies are identifying and investigating the widest range of terror financing activity; that terror financing prosecutions result in effective, proportionate and dissuasive sanctions; that there is effective implementation of targeted financial sanctions against all 1267 and 1373 designated terrorists and those acting for or on their behalf; and that there is enforcement against violations of targeted financial sanction.

While Pakistan has been seized with meeting the FATF requirements for more than two years, there is no denying that the long-drawn exercise will culminate in ridding the nation of the nuisance of money laundering and terror financing — crimes that have earned a bad name for the country globally.

Published in The Express Tribune, October 25^th, 2020.

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