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Thursday March 28, 2024

Remember the FATF

By Editorial Board
May 10, 2020

Due to the corona crisis, the Financial Action Task Force (FATF) has postponed its June-2020 plenary meeting, giving Pakistan some relief. But it should not prompt us into a gloating mode, as still there will be an evaluation of Pakistan’s progress on the 27-point action plan in Beijing in the last week of June, 2020. Though it will not be a plenary, there will be a joint working group meeting of the Eurasian Group and the FATF to discuss the issues. Regarding Pakistan, the main focus will be the country's performance to meet international commitments and standards in the fight against money laundering and terror financing. It is worth recalling that the Paris-based global watchdog against financial crimes had met in its last plenary in February this year and gave Pakistan a four-month grace period to complete its remaining obligations per the 27-point action plan against money laundering an terror financing.

The international community has been concerned at the slow pace of progress which resulted in the delivery of just 14 points whereas we missed 13 targets again, even after repeated allowances given to us. Pakistan must take this coming assessment next month pretty seriously and not expect to rely on any excuses for its failure to meet the targets. Pakistan needed a broad-based strategy to complete its outstanding commitment with the FATF, and to some extent it did manage to put in place a framework, but sadly that was not enough to demonstrate full commitment and convince the world community to remove it from the grey list. We must be able to show that we are actively making progress in all directions per the FATF directives. Since we have exhausted all deadlines to complete the 27-point action plan, and still we could manage only 14 items, we must be fairly concerned now to accomplish the remaining targets. We need to swiftly complete the full action plan by June 2020, if we are serious about avoiding the much dreaded blacklist. The blacklist means we would move to the list of monitored jurisdiction, which is an ignominious slide by all counts.

One of the demands by the FATF is showing significant and sustainable progress in penalizing and prosecuting terror financing. As India is keen to show that any happenings in Indian-held Kashmir fall under the category of terrorism supported by Pakistan, there is more urgency for us to counter such efforts. If we fail to show substantial progress yet again, the FATF may call its members and urge all jurisdiction to advise their financial institutions to give special attention to business relations and transactions with Pakistan. We must make all efforts to avoid that outcome.