A visiting delegation from the Asia-Pacific group on money laundering will complete its review on Thursday of Pakistan's compliance with obligations regarding fighting terror financing in order to submit its report to the Financial Action Task Force (FATF), a media report said on Wednesday.
By the end of September next year, Pakistan has to comply with a 10-point action plan it committed with the FATF in June this year to combat terror financing and money laundering to get out of the grey list or else fall into the black list, the Dawn reported quoting a finance ministry official.
FATF, an inter-governmental body aimed at combating money laundering and terrorist financing, has placed Pakistan on its 'grey list' for failing to curb terror financing.
The APG, an associate member of the FATF, has direct access to its policy-making and standards-setting process. Members are committed to adopting FATF recommendations to battle money laundering.
The APG comprises 41 member-countries including, the US, Australia, Canada, China, Pakistan, India, Nepal, Bhutan, Myanmar, Afghanistan, Bangladesh, Singapore and the Maldives.
The six-member APG delegation visiting Pakistan did not have any meeting scheduled with caretaker Finance Minister Shamshad Akhtar.
But it is expected to have a wind-up session with the federal finance secretary after going through a checklist of 26 actionable points with other stakeholders, including the Financial Monitoring Unit (FMU) of the State Bank of Pakistan, Securities and Exchange Commission of Pakistan (SECP), National Counter Terrorism Authority (Nacta), Federal Investigation Agency (FIA) and representatives of the ministries of foreign affairs and interior.
The official said the response to the checklist by the authorities had already been finalised for sharing it with the APG after a plan to improve laws and strengthen the agencies concerned was approved by the caretaker cabinet last month.
Under the plan, the FMU will be upgraded, punishments and penalties will be enhanced to check smuggling of currency and two legal documents — Anti-Money Laundering Ordinance 2010 and Foreign Exchange Regulation Act 1947 — will be strengthened to meet the requirements of United Nations resolutions.
The official said the homework to address serious deficiencies had been completed and its implementation was in progress and would be completed within the time frame committed with the FATF, the daily reported.
The official said the SECP and the SBP had recently taken steps for strengthening the regulatory regime on anti money laundering and combating the financing of terrorism.
To address risk-based challenges and changing identities and titles, the regulators have streamlined documentations for all individuals and entities in financial dealings.
To ensure that criminals are not able to hide their identity through use of complex ownership structure of companies, partnerships, trusts or other similar forms, the financial institutions are required to identify the ultimate beneficial owner, who is a natural person, of all legal persons and legal arrangements before offering their services to them, the official said.
Pakistan was found deficient in four areas such as supervision of AML/CFT, illicit cross-border movement of currency by terror groups, weak investigation and poor outcome of prosecution on terror financing and unsatisfactory implementation of UNSC resolutions 1267 and 1373.