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Pakistan dispatches detailed reply to FATF

Pakistan is expecting that the FATF may grant another relaxation probably up to June or September 2020 in its upcoming plenary review meeting

By Mehtab Haider
January 09, 2020

ISLAMABAD: Pakistan on Wednesday night dispatched its detailed reply comprising about 120 pages along with annexure details of 500 pages to the Joint Group of Financial Action Task Force (FATF) for sharing progress on 22 points in a bid to come out of the grey list.

One top official of government confirmed to The News on Wednesday night that the detailed response and progress report wasr eady and would be dispatched to FATF tonight.

Now the joint group of FATF will scrutinise Pakistan’s compliance/performance report in its scheduled meeting at Beijing (China) from January 21 to 24, 2020 where the Pakistani delegation will be given the opportunity to defend each and every point written in its progress report.

The plenary meeting of FATF for deciding the fate of the county is expected to take place in Paris by mid February 2020 in which Pakistan’s progress report on 22 point action plan will be gauged with possibility of three scenarios, including graduating from grey list to white list, keeping the country on grey list for another extended period of three to six months and thirdly putting the country on undesirable blacklist.

Earlier, the FATF in the last plenary meeting had shown satisfaction over 5-point action plan out of total 27 and kept the country on the grey list for extended period up to February 2020.

“Pakistani authorities are expecting that the FATF plenary meeting will show satisfaction over more action plans,” said the sources and added that it would be premature to give any judgment at this stage but one thing was crystal clear that the country is making progress towards implementation on FATF Action Plan.

Pakistan is expecting that the FATF may grant another relaxation probably up to June or September 2020 in its upcoming plenary review meeting, as the February deadline is too short a period for Pakistan to comply with all remaining 22 action plans.

The FATF kept the country on its grey list for an extended period up to February 2020 and warned that it would be put on the blacklist if it did not comply with the remaining 22 out of 27 points related to anti-money laundering and counter-terrorist financing.

Pakistan has so far successfully managed to avoid the blacklist due to diplomatic support from China, Turkey, Malaysia, Saudi Arabia and Middle East countries. India had failed to convince the world powers that Pakistan was not cooperating with the watchdog related to terror financing. Now Pakistan required three votes out of total 39 members of FATF forum to avoid falling into blacklist.

The joint working group of the FATF declared Pakistan as largely compliant on 10 points, but the FATF plenary meeting accepted Islamabad’s compliance only on five points out of 27 action plans.

The FATF said all deadlines in the action plan had now expired. Noting recent improvements, the FATF again expressed serious concern over the overall lack of progress by Pakistan to address its terrorist financing (TF) risks, including remaining deficiencies in demonstrating a sufficient understanding of its transnational TF risks, and more broadly, the country’s failure to complete its action plan in line with the agreed timelines and in light of the TF risks emanating from the jurisdiction.

Pakistan has only largely addressed five of 27 action items, with varying levels of progress made on the rest of the action plan. The FATF strongly urged the country to swiftly complete its full action plan by February 2020.

“Should significant and sustainable progress not be made across the full range of its action plan 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 FIs (financial institutions) to give special attention to business relations and transactions with Pakistan,” the FATF stated in its previous statement.