Deadlines are over, act or face financial consequences: FATF to Pak

Shubhajit Roy
Pakistan fatf, pakistan fatf blacklist, pakistan terrorist financing, fatf grey list, FATF warning to pakistan, indian express

In this March 23, 2019 photo, Pakistan's Army Chief Gen. Qamar Javed Bajwa, watches a parade with Prime Minister Imran Khan, left, and President Arif Alvi, in Islamabad, Pakistan. (AP Photo/Anjum Naveed)

In a stern warning to Pakistan which managed to stay on the “grey list”, global terrorist financing watchdog Financial Action Task Force (FATF), chaired by China, told Islamabad that “all deadlines” have expired and if they don’t prosecute and penalise terrorist financing by June 2020, the FATF will take action which will have financial consequences.

In effect, Pakistan could face the FATF “blacklist” if it failed to implement the remaining action plan by June 2020.

The FATF, in its plenary meeting held in Paris from February 16-21, expressed serious concerns on Pakistan’s failure to complete its 27-point action plan in line with the agreed timeline which ended in September 2019.

This was the key takeaway after the FATF plenary session ended Friday. FATF President Xiangmin Liu of the People’s Republic of China chaired the plenary — China has the presidency until June.

In a significant development, as first reported by The Indian Express on February 20, China and Saudi Arabia had also joined India, US and European countries, among others, to send Pakistan a stern message to complete the commitments on terrorist financing and money laundering given to FATF by June 2020 including “conviction and prosecution of top leaders of all terrorist organisations”.

The FATF statement said: “All deadlines in the action plan have expired. While noting recent and notable improvements, the FATF again expresses concerns given Pakistan’s failure to complete its action plan in line with the agreed timelines and in light of the TF (terrorist financing) risks emanating from the jurisdiction. To date, Pakistan has largely addressed 14 of 27 action items, with varying levels of progress made on the rest of the action plan. The FATF strongly urges Pakistan to swiftly complete its full action plan by June 2020.”

“Otherwise, should significant and sustainable progress especially in prosecuting and penalising TF not be made by the next plenary, the FATF will take action, which could include the FATF calling on its members and urging all jurisdiction to advise their financial institutions to give special attention to business relations and transactions with Pakistan,” the statement said.

Officials in New Delhi said Pakistan’s propaganda on exiting the FATF grey list in February 2020 has been “proved false”.

In a detailed statement, the FATF said that since June 2018, when Pakistan made a high-level political commitment to strengthen its anti money-laundering and Combating Financing of Terrorism (AML/CFT) regime and to address its strategic counter-terrorist financing-related deficiencies, Pakistan’s political commitment has led to progress in a number of areas in its action plan, including risk-based supervision and pursuing domestic and international cooperation to identify cash couriers.

The FATF asked Pakistan to demonstrate that terrorist financing-related prosecutions result in effective, proportionate and dissuasive sanctions and demonstrate effective implementation of targeted financial sanctions against key UN-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.

Pakistan was placed on the grey list in June 2018 and was given a plan of action to complete by October 2019 or face the risk of being placed on the black list. The FATF is an inter-governmental body established in 1989 to combat money laundering, terrorist financing and other related threats to the integrity of the international financial system. It currently has 39 members, including two regional organisations — the European Commission and the Gulf Cooperation Council. India is a member of the FATF consultations and its Asia Pacific Group.