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FATF blacklisted Pakistan against terror financing and money laundering

By
AC Team 2
-

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On August 16,2019, the Asia Pacific Group (APG) of the Financial Action Task Force(FATF) has blacklisted Pakistan for non-compliance and non-enforcement of safeguards against terror financing and money laundering. The action was taken in the FATF APG meeting held in Canberra, Australia.FATF blacklisted Pakistan

Key points
i. Previously Pakistan was greylisted by FATF for failing to curb anti-terror financing.
ii. By this APG blacklisting which is also known as  ‘Enhanced Expedited Follow Up’ status, Pakistan’s chances at extricating(freeing from constraint or difficulty)  itself from the FATF greylist are expected.
iii. APG report:
Compliance parameters: According to the report, Pakistan failed in 32 out of 40 ‘compliance’ parameters for its legal and financial systems.
Effectiveness parameters:pakistan had also failed in the 10 of 11 ‘effectiveness’ parameters for enforcing safeguards against terror-financing and money-laundering by UN-sanctioned entities and other non-government outfits.
Compliance by Pakistan:
A compliance document that was submitted by Islamabad on behalf of Pakistan’s action against terror groups of its past 1.5 years will be reviewed against a 27-point action plan set out by the FATF.
Decisions: one of the three following decisions would be taken. They are

  • To remove Pakistan from greylist.
  • To continue keeping Pakistan on greylist or
  • Further downgrade Pakistan to the Blacklist.

iv. The Indian side was represented by officials from the Ministry of Finance,external affairs and home affairs. Similarly the Pakistan multi ministerial team is led by its State bank Governor Reza Baqir.
v.Action demanding Pakistan’s review is pushed by the United States, the United Kingdom, Germany and France.

greylisted details of pakistan:
i.Pakistan was put on grey list by FATF on January 28 2018 just after the day a 26 point action plan was submitted to the FATF by Pakistan in order to avoid being blacklisted for its activity of funding militant groups including Mumbai terror attack mastermind Hafiz Saeed’s terrorist activities.
ii.The country was also on greylist from 2012-2015 period.

About FATF:
♦ It is a global watch talk for terror financing and money laundering.
♦ Founded – 1989.
♦ President- Xiangmin Liu.
♦ Headquarters-  Paris, France.

About APG:
♦ It is a FATF style regional body for Asia-Pacific region.
♦ Founded- 1997.
♦ Headquarters- Sydney, Australia.
♦ Official language- English.