ISLAMABAD: Though the meeting of the National Security Committee (NSC) on Financial Action Task Force (FATF) has given a clear message to the world that Pakistan is committed to fulfilling its international responsibilities, the country, as experts believe, needs to address concerns related to some individuals and organisations rather than more tightening regulations.
A renowned economist, who wished not to be named, said that although Pakistan has taken enough steps on administrative and regulatory grounds to avoid adversary decision from FATF, the international community is unsatisfied is about the actions taken against banned organisations and individuals.
“This is why the meeting of NSC was held to give the clear message that both the civil and military regimes are on a similar page regarding the steps taken against these organisations. Probably messages have been conveyed that the country has taken required measures against these elements,” he said.
“However, I still doubt that our position is weak in this regard. Instead of restricting the banking sector more, we should now focus on these individuals and their organisations. The banking sector is already facing many restrictions and further regulations may undermine the business of the sector,” he added.
According to sources at Ministry of Finance, the government, apart from implementing other laws, needed to show progress on actions against those banned organisations working under new or different names. Their accounts needed to be frozen while strictly monitoring their financial transactions. “Though we talk much about administrative or regulatory measures here, the FATF’s point of concern is the alleged home-grown outfits. We need to convince the world to have done enough against these organisations in order to avoid any drastic measures from FATF,” they said adding, unfortunately, the Pakistan Muslim League-Nawaz (PML-N) government had not taken the issues seriously. They further asked how the caretaker government can improve things within two months.
Islamabad is required to submit an action plan for review by the FATF with regard to its actions to curb money laundering and terror financing. Reports suggest that Islamabad risks being placed on the blacklist of countries that financially aid terrorism if its action plan is rejected by the task force.
According to the sources, in case Pakistan falls in grey or blacklist, some banks, including Standard Chartered Bank, as adversary effect of the development, may not be able to make further investment/diversify their business in the country.
The NSC, which reviewed the issue in detail, had recently decided to share the progress with the FATF Secretariat in the upcoming meeting scheduled in Paris from June 24-29.
Finance Minister Dr Shamshad Akhtar had briefed the NSC about both administrative and legal measures taken so far by the country to meet FATF requirements.
Based in Paris, FATF, the global watchdog on money laundering and terror financing, had put Pakistan on its watch list in February this year. Pakistan’s inclusion in the greylist implied that it is among those countries that do not do enough to curb terror financing.
Pakistan was listed as grey in 2012 but was removed in 2015 after strenuous efforts to address the concerns of the group.