FATF retains Pak on its ‘grey list’
The Financial Action Task Force (FATF) on Thursday retained Pakistan in its grey list and urged the country to do more to investigate and prosecute senior leaders and commanders of UN-designated terror groups involved in terror financing.
FATF president Marcus Pleyer said after a three-day plenary meeting of the multilateral watchdog that Jordan, Mali and Turkey had been added to the list of countries under increased monitoring or grey list because of serious issues in their regimes to counter money laundering and terror financing.
Following the Taliban takeover of Afghanistan, FATF also expressed “concern about the current and evolving money laundering and terrorist financing risk environment” in the war-torn country.
“Pakistan remains under increased monitoring,” Pleyer told an online news briefing. “Pakistan has taken a number of important steps but needs to further demonstrate that investigations and prosecutions are being pursued against the senior leadership of UN-designated terror groups,” he said.
Pakistan was added to the grey list in mid-2018 and given a 27-point action plan by FATF to control money laundering and terror financing. In June this year, FATF asked Pakistan to implement another seven-point action plan to address serious deficiencies related to money laundering.
Pleyer said Pakistan had “addressed or largely addressed” 30 out of the 34 items in the two action plans. He said the country had made “good progress” on the 2021 action plan by tackling four out of the seven items, including checks on businesses and enacting legislative amendments to ensure international cooperation.
But Pleyer insisted Pakistan must deliver on the sole remaining item in the 2018 action plan by demonstrating that its investigations and prosecutions are targeting senior leaders and commanders of UN-designated groups. He brushed aside several questions from Pakistani journalists that FATF’s actions were political in nature and said that the watchdog made all decisions within a technical framework following voting by the organisation’s members.
FATF said in a statement that Pakistan had made significant progress in addressing its “strategic counter-terrorist financing-related deficiencies”.
The statement added: “Pakistan should continue to work to address its other strategically important AML/CFT deficiencies, namely by: (1) providing evidence that it actively seeks to enhance the impact of sanctions beyond its jurisdiction by nominating additional individuals and entities for designation at the UN; and (2) demonstrating an increase in ML investigations and prosecutions and that proceeds of crime continue to be restrained and confiscated in line with Pakistan’s risk profile, including working with foreign counterparts to trace, freeze, and confiscate assets.”
In a separate statement on Afghanistan, FATF said that the watchdog, “as the global standard setting body for anti-money laundering and counter-terrorist financing, expresses its concern about the current and evolving money laundering and terrorist financing risk environment in the country”.
FATF affirmed the UN Security Council Resolutions on the situation in Afghanistan, especially resolution 2593 which “demands that Afghan territory not be used to threaten or attack any country or to shelter or train terrorists, or to plan or to finance terrorist acts”.
The statement on Afghanistan added, “The FATF calls on all jurisdictions’ competent authorities to provide advice and facilitate information sharing with their private sectors on assessing and mitigating any emerging ML/TF risks identified, in accordance with the risk-based approach.”
At the same time, FATF reiterated the “upmost importance of ensuring non-profit organisations (NPOs) and all other humanitarian actors can provide the vital humanitarian assistance needed in the region and elsewhere, without delay, disruption or discouragement. The FATF calls on all jurisdictions to protect NPOs from being misused for terrorist financing.”
The FATF, together with its affiliates APG, EAG and the Global Network, will “closely monitor the situation, including any changes to money laundering and terrorist financing risks in Afghanistan”, and consider all options to help promote security, safety and the integrity of the global financial system.
At its last virtual plenary meeting in June, the watchdog had retained Pakistan in its “grey list” for failing to adequately investigate and prosecute leaders of UN-designated terrorist groups.