KARACHI: Pakistan is unlikely to be placed on the blacklist of the global financial watchdog as the country has made enough progress to meet international anti-money laundering and terror financing standards, a brokerage said on Monday. “Since a comprehensive action plan has already been submitted, we believe that chances of Pakistan to be placed on the blacklist in the ongoing FATF (Financial Action Taskforce) meeting is least likely, contrary to the market expectations, as only countries that do not make sufficient progress or fail to provide an action plan are moved to the blacklist,” Topline Securities said in a flash note. “We also downplay concerns of an adverse impact on Pakistan’s economy due to its inclusion in the blacklist in case Pakistan fails to satisfy FATF.” A Pakistani delegation is currently on a visit to Paris to attend FATF meeting that started on June 24 (Sunday). “The week’s meetings will conclude with the third and final plenary meeting on 27-29 June, where they will officially place Pakistan on the Improving Global Anti-money Laundering (AML)/Countering Financing of Terrorism (CFT) compliance’s list, also known as the grey list,” Topline Securities said. This list comprises of jurisdictions with strategic AML/CFT deficiencies for which they have developed an action plan with the FATF. In February, FATF decided to place the country on the grey list from June. The country was previously part of high risk jurisdictions (blacklist) in 2008 and 2012, while it was under jurisdictions that were making sufficient progress (grey list) in 2010 and 2014. Pakistan was removed from the grey list in 2015. Though FATF did not officially announce Pakistan’s placement on the grey list, the US and the UK jointly moved the FATF in February, nominating Pakistan for placement on the grey list and were subsequently joined by France and Germany. Later, Pakistan was asked to submit a comprehensive action plan to be reviewed in the ongoing FATF meeting for countering the financing of terrorism deficiencies. Pakistan has made a lot of efforts to counter financing terrorism and preparing anti-money laundering laws and recently addressed issues raised by the FATF on the tax amnesty scheme. On June 8, the National Security Committee reaffirmed its commitment to cooperate with the FATF, while Securities and Exchange Commission of Pakistan issued Anti-money Laundering and Countering Financing of Terrorism Regulations (2018) on Jun 20. Topline Securities said though Pakistan’s inclusion in the blacklist may hurt its standing in the international landscape, it will not be as severe as recently been portrayed. “This is because when Pakistan was part of the grey list/blacklist (2008-2015), it successfully approached multilateral bodies, floated international bonds and had international trades.” Currently, FATF has officially designated 10 countries under high-risk jurisdictions (blacklist) and jurisdictions that are making sufficient progress (grey list). There are eight countries under FATF’s grey list, namely Ethiopia, Iraq, Serbia, Sri Lanka, Syria, Tunisia, Vanuatu, Yemen and two countries under the blacklist, including Iran and North Korea. The FATF and the Middle East and North Africa FATF are holding 6-day joint plenary meetings in Paris to protect the integrity of the global financial system and to contribute to safety and security. The meetings involve delegations from the 203 jurisdictions of the FATF Global Network, as well as the United Nations, International Monetary Fund, World Bank and other partners. FATF identifies jurisdictions with strategic AML/CFT deficiencies in its two public documents: FATF Public Statement (call for action) and Improving Global AML/CFT Compliance and On-going Process that is issued three times a year. FATF does not use grey list/blacklist terminologies Countries that are identified as having deficiencies in their financial system are placed on grey list (ongoing process), while countries that are not making sufficient progress in addressing the deficiencies or have not committed to an action plan are moved to blacklist and termed as high risk jurisdictions (public statement-call for action).<doc-sep>(Representative image) Key Highlights The Paris-headquartered watchdog body, Financial Action Task Force, yesterday began discussions on the action plan If FATF is satisfied with this plan, it will put Pakistan on the less stringent 'grey list' If FATF isn't convinced, it will go ahead and blacklist Pakistan; a decision is expected on Friday NEW DELHI: To avoid being blacklisted by a global terror financing watchdog, Pakistan has committed to a 26-point action plan to erase sources of terror funding, a plan it envisages implementing over 15 months, reported Pakistani newspaper The Express Tribune. The Paris-headquartered watchdog body, Financial Action Task Force (FATF), yesterday began discussions on the action plan, said sources in Pakistan's finance ministry to the Tribune. If FATF is satisfied with this 26-point promise, it will put Pakistan on the less stringent ' grey list ' like it indicated it would in February. If FATF isn't convinced, it will go ahead and blacklist Pakistan. A decision is expected on Friday. The plan, that the International Cooperation Review Group of the Asia Pacific Group submitted to the terror financing watchdog - which Pakistan committed to - requires Pakistani authorities to proactively cooperate with counterpart bilateral agencies to choke financing to Da'ish, Al Qaeda, and the Haqqani Network, as well as India-oriented terror groups Jamaat-ud-Dawa and its affiliates Lashkar-e-Toiba and Jaish-e-Mohammed, said the Tribune report. Pakistan must give special focus to curb cash smuggling, narcotics trafficking, and misuse of non-profit organisations, particularly funding of all these terrorist groups. "Pakistan will have to deliver on the first goal by January next year and complete all the 26 actions by September 2019," the finance ministry sources said. By May, Pakistan will have to show that terrorism financing prosecutions successfully result in effective, proportionate and dissuasive sanctions against natural and legal persons convicted of terrorism financing offences. And by September 2019, Pakistan will address the key concern of identifying and investigating the widest range of terrorism financing activities like the collection, movement or use of funds.<doc-sep>
Pak's placement on to grey list could hurt country's economy as well as its international standing. Pakistan has been placed on the grey list by the Financial Action Task Force or FATF for failing to curb anti-terror financing despite its diplomatic efforts to avert the decision, an official said today. The decision was taken late Wednesday night at the global financial watchdog plenary session in Paris where Finance Minister Shamshad Akhtar represented Pakistan, according to official sources. The announcement comes a day after Pakistan submitted a comprehensive 26-point action plan to the FATF to choke the funding of terrorist groups, including Mumbai attack mastermind Hafiz Saeed-led JuD and its affiliates, to avoid being blacklisted by it. The placement on to grey list could hurt Pakistan's economy as well as its international standing. Earlier in the day, Mr Akhtar had urged the FATF to remove Pakistan from its grey list. As the 37-nation FATF plenary began its proceedings on Pakistan's 26-point action plan spanning over a period of 15 months, the Pakistani delegation apprised the watchdog of steps Islamabad had taken to weed out money laundering and terror financing to avoid the country being placed on the grey list. Official sources in the Foreign Office said that being placed officially on the grey list was not a surprise for Pakistan. "It is a political decision and nothing to do with the performance of Pakistan against terrorism," they said. They said that Pakistan will stay on the list for a year or so and will eventually be out of it as has happened in the past. Pakistan remained on the FATF grey list from 2012 to 2015. The process began in February 2018 when FATF approved the nomination of Pakistan for monitoring under its International Cooperation Review Group (ICRG) commonly known as grey list. Pakistan was asked to prepare a plan to address international body's concerns and get its approval or it could risk being moved to the black list. It presented a 26-point plan of action to the FATF planery with the commitment to implement it over a period of 15 months to address the concerns of the global community. The endorsement of the plan means that FATF formally placed Pakistan on the list. In case it had rejected the plan, Pakistan would have been on FATF's Public Statement, also called as the black list. On June 20, the Securities and Exchange Commission of Pakistan issued Anti Money Laundering and Countering Financing of Terrorism Regulations 2018, in compliance with FATF recommendations. On June 8, the National Security Committee (NSC) reaffirmed its commitment to cooperate with FATF. 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. By January next year, Pakistan will publish updated lists of persons and entities proscribed under the Anti-Terrorism Act and the UN-designated entities.