Pakistan stays on FATF grey list

NEW DELHI: Pakistan will stay on the FATF ‘grey list’ until June 2020, after which it could slip into the ‘black list’. As the global body to fight terror financing wound up its plenary in Paris, Pakistan was told it could go into the black list if it failed to complete its 27-point action plan, diplomatic sources told TOI.
Of particular concern to the Financial Action Task Force (FATF) is Pakistan’s failure to make significant progress in prosecuting and penalising terror financing. If Islamabad failed to take credible action by June, the FATF has warned that it could urge its members and all jurisdictions to advise their financial institutions to give special attention to business relations and transactions with Pakistan. As in the October 2019 plenary, the language used was identical to that used on Iran, which is currently in the black list.
Pakistan and the Imran Khan-led government had promised to its people that they could get out of the grey list in February. Pakistan stayed out of the black list with three countries — China, Malaysia and Turkey — speaking for it. But to get out of the grey list, Islamabad needed 13 countries to vouch for its efforts. Pakistan had lobbied hard, and many countries would have spoken in its favour. But on technical grounds at least, with evidence of money trail that put a lie to its claims, Pakistan could not claim clemency.
Pakistan had arrested Lashkar-e-Taiba chief Hafiz Saeed days before the FATF plenary to show commitment. On Thursday, it was told that it had to convincingly prosecute and convict the top leaders of all terrorism groups as mentioned in the action plan, sources said.
This could put Khan and the ISI in a spot, with their credibility coming under serious question, even within the country.
Specifically, Pakistan has been asked to show action on eight following areas:
Demonstrate that remedial actions and sanctions are applied in cases of anti-money-laundering/terror-financing violations, relating to terrorist financing risk management.
Pakistan has to show that “competent authorities” are cooperating and taking action to identify and take enforcement action against illegal money or value transfer services.
It has to demonstrate implementation of cross-border currency and bearer-negotiable instruments controls at all ports of entry, including imposing effective sanctions.
Pakistan has to demonstrate that law enforcement agencies are identifying and investigating the widest range of terror financing activity and that these investigations and prosecutions target designated persons and entities, and those acting on behalf or at the direction of the designated persons or entities.
It has to show that terror financing prosecutions result in effective, proportionate and dissuasive sanctions.
It has to implement targeted financial sanctions (supported by a comprehensive legal obligation) against all 1267 and 1373 designated terrorists and those acting for or on their behalf, including preventing the raising and moving of funds, identifying and freezing assets (movable and immovable), and prohibiting access to funds and financial services.
It has to demonstrate enforcement against terror financing violations including administrative and criminal penalties and provincial and federal authorities cooperating on enforcement cases.
Pakistan has to show that facilities and services owned or controlled by designated persons are deprived of their resources and the usage of the resources.

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