FATF may warn Pak to curb terror or face blacklisting
The FATF is expected to issue the warning at the conclusion of its plenary meeting in Paris on February 21, said the people who declined to be identified. As expected, Pakistan will be retained in FATF’s “grey list”, in which it was placed in June 2018.Updated: Feb 21, 2020 00:55 IST
The Financial Action Task Force (FATF) is set to warn Pakistan it faces the prospect of being included in the watchdog’s “black list” if it doesn’t fully implement an action plan to curb terror financing by June 2020, people familiar with developments said on Thursday.
The FATF is expected to issue the warning at the conclusion of its plenary meeting in Paris on February 21, said the people who declined to be identified. As expected, Pakistan will be retained in FATF’s “grey list”, in which it was placed in June 2018. At that time, Pakistan was asked to implement the 27-point action plan to counter terror financing and money laundering.
Barring Turkey, the other countries and organisations in the 39-member multilateral watchdog expressed serious concern at Pakistan’s failure to implement the action plan in line with agreed timelines, including the latest deadline of September 2019, as well as the terror financing risks emanating from the country.
The report to be issued at the conclusion of the FATF’s meetings on Friday is expected to ask Pakistan to swiftly complete the full action plan by June 2020, and also warn it that, if “significant and sustainable progress”, especially in terms of prosecuting and penalising those involved in terror financing, is not be made by then, the watchdog will take steps such as calling on its members and urging all jurisdictions to advise their financial institutions to give special attention to business relations and transactions with Pakistan, the people said.
This will be tantamount to putting Pakistan in the black list, which will entail harsher sanctions and intense scrutiny of all financial transactions. Currently, only Iran and North Korea are on the black list.
Pakistani leaders have sought to convey the impression the country would get out of the grey list, though diplomats of several Western countries told HT earlier this year they expected Pakistan to be retained on the list as it was fully or partially compliant with only 14 of the 27 points of the FATF action plan.
The people cited above said Pakistan would now be expected to deliver on its political and international commitments, including taking “urgent credible, verifiable, irreversible and sustainable steps” to fully implement the FATF action plan. This, they said, would include prosecution and conviction of leaders of proscribed terror groups and addressing global concerns about terror financing from territory under Pakistan’s control.
The FATF’s report is expected to call on Pakistan to demonstrate that its law enforcement agencies are “identifying and investigating the widest range of TF (terror financing) activity and that TF investigations and prosecutions target designated persons and entities”.
The report is also expected to ask Pakistan to show that “TF prosecutions result in effective, proportionate and dissuasive sanctions” and that it is effectively implementing “targeted financial sanctions (supported by a comprehensive legal obligation) against all (UN Security Council Resolution) 1267 and 1373 designated terrorists”, including “preventing the raising and moving of funds, identifying and freezing assets (movable and immovable), and prohibiting access to funds”, the people said.
The FATF’s actions, the people said, indicated the watchdog’s members believe that Pakistan’s actions such as the prosecution and sentencing of Lashkar-e-Taiba founder Hafiz Saeed are inadequate. Saeed was given a prison term of five-and-a-half years in two terror financing cases four days before the FATF meetings.
However, Pakistan is yet to act against other UN-designated terrorists such as Jaish-e-Mohammed chief Masood Azhar and mob boss Dawood Ibrahim.