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SECP holds awareness session for NPOs on AML/CFT obligations

By Our Correspondent
September 14, 2018

ISLAMABAD: The Securities and Exchange Commission of Pakistan (SECP) and National Counter Terrorism Authority (NACTA) on Thursday organised an awareness session for not-for-profit organisations (NPOs) on anti-money laundering and countering financing of terrorism (AML/CFT).

The session to sensitise about the regulatory framework was held at the SECP head office, a statement said.

The SECP issued the AML/CFT Guidelines for NPOs in September 2018, to facilitate the NPOs to mitigate the ML/TF risks and other abuses. The session aimed to develop government-NPO engagement through an inclusive approach.

The recommendations of Financial Action Task Force (FATF) require countries to work with NPOs to develop and refine best practices for addressing terrorist financing risks and vulnerabilities to protect from TF abuse.

The SECP officials apprised the participants about the regulatory framework applicable to NPOs incorporated under the Companies Act, 2017.

The regulatory measures to prevent the NPOs from ML/TF abuses, as specified under the regulations for section 42 companies, and supplemented by the best practices and recommendations contained in the NPO guidelines, were also highlighted.

Through issuance of the guidelines, the SECP has adopted a soft law approach to ensure that the legitimate and essential work being carried on by NPOs does not suffer.

The NACT representative gave an overview of the NACTA and highlighted the measures taken by it for countering the financing of terrorism in the country. He also mentioned the measures taken by NACTA in collaboration with other stakeholders and authorities to ensure compliance with FATF recommendation number 8.

A large number of participants from community service organisations and NPOs working in health, education, charitable and social welfare sectors attended the event.

It was an interactive session and various issues relating to the licensing regime of not-for-profit companies, NPO certification mechanism for tax exemption purposes, and security clearance required from the relevant government authorities were discussed.

The SECP also highlighted the AML/CFT framework and obtained feedback from the participants. The stakeholders were provided with a dedicated email address to raise their concerns or to make suggestions.

The session was the first in a series of similar events being conducted across the country to sensitise the NPO sector with the recommendations of the FATF and the best practices that companies might adopt to prevent the abuse arising from money laundering, terrorist financing and other predicate offences.