Pakistan to stay on global finance watchdog’s gray list

Islamabad to stay on Financial Action Task Force gray list for another 4 months despite ‘making good progress’

PAKISTAN, Oct. 22, (AA): Pakistan will stay for another four months on the gray list of the Financial Action Task Force (FATF), the global money-laundering watchdog announced Thursday.

Announcing the decision after a five-day virtual plenary session, FATF head Marcus Pleyer said that Islamabad has “addressed or largely addressed” a majority of the watchdog’s conditions but that it has to complete two concurrent action plans with a total of 34 items.

“Overall, Pakistan is making good progress on this new action plan. Four out of the seven action plan items are now addressed or largely addressed, ” Pleyer said.

“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.”

Asked about the alleged role of Pakistan’s rival India in ensuring that Islamabad remains on the gray list, he said the “FATF is a technical body” which takes its decisions by consensus.

“So it’s not only one country that makes decisions.”

This July, India’s Minister for External Affairs S Jaishankar said New Delhi had ensured that Pakistan remained on the FATF’s watch list.

Islamabad’s steps

In June the FATF announced that Pakistan would stay on the gray list for another four months. The watchdog’s next plenary session is set for next February.

Islamabad has been on the global money-laundering watchdog’s radar since June 2018, when it was placed on its gray list for terrorist financing and money laundering risks after an assessment of the country’s financial system and security mechanism.

The South Asian nuclear nation has since escaped being placed on the watchdog’s financial crime blacklist four times with the support of Turkey, China, and Malaysia.

According to the FATF charter, a country must have the support of at least three member states to avoid being blacklisted.

In recent years, Islamabad has taken some major steps under the plan, which include strict checks on the opening of new bank accounts and bans on foreign currency transactions without a national tax number and currency changes of up to $500 in the open currency market without the sides submitting a copy of their identification documents.

In addition, Pakistan has also banned several militant groups and seized their assets, including Jamaat ud Dawah, and Jaish-e-Mohammad (JeM) – the groups blamed for several terrorist attacks such as the 2009 deadly Mumbai attacks, killing over 150 people.

Last year, an anti-terrorism court sentenced Hafiz Mohammad Saeed, Jamaat ud Dawah’s chief, to 11 years in jail in two terror-financing cases – a development widely seen as an attempt to woo FATF members.