FATF-related bills approved with amendments by Senate panel

ISLAMABAD: The Senate Standing Committee on Finance and Revenue approved two key bills on Tuesday to meet Pakistan’s commitment to the Financial Action Task Force (FATF).

The Anti-Money Laundering (amendment) Bill, 2019, and the Foreign Exchange Regulations (amendment) Bill, 2019, were given a nod by the committee chaired by Senator Farooq H Naik, after making amendments.

During the deliberations, Kamran Baloch, the secretary finance, pointed out that the amendments in the bills were vital to bring Pakistan out of the grey list of the Financial Action Task Force (FATF) and to further strengthen the country’s economy, reports the APP.

The Paris-based international organisation, tasked to combat money laundering, placed Pakistan on its grey list on June 2018. The country was then given a plan of action to curb money laundering and terror financing. Pakistan’s progress will be reviewed by the FATF in February.

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The amendments proposed by the Senate committee include enhancing punishments for money laundering to act as a deterrent and changing the offence of money laundering from a non-cognizable to a cognizable crime, which will allow the police to make arrests without a warrant.

Lawmakers were divided over the latter proposal. “I have serious doubts that by making this a cognizable crime, it would be misused,” Senator Ayesha Raza Farooq said, “We can also retain this as a non-cognizable crime by improving our performance.” While Senator Ateeq Sheikh said that legitimate businessmen should be differentiated from terror financers or money launders.

At the end of the meet, the amendments were approved with the consent of five members while four voted against them, according to the APP.

Meanwhile, discussing the Foreign Exchange Regulations (amendment) Bill, the committee strongly objected to putting a limit on the physical movement of foreign currency cash, as stated in the bill, and unanimously rejected the proposal.

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Farooq said there should not be any limit on the inland movement of foreign currency as this law had the potential to be misused for political purposes.

To which, the officials from the ministry of finance clarified that there was no limit on the transfer of foreign currency from one bank account to another, within or outside the country, the limit would only be imposed on cash transfers. They further added that militants could easily transfer huge amounts of foreign currency in cash and that was why this amendment was necessary.

The officials also explained that a person would be free to move or transfer $10,000 in cash in the country, anything exceeding that limit would require prior permission of State Bank of Pakistan.

The secretary finance informed the committee that this practice was being implemented in other countries such as the USA, UK, France and Spain as well.

The committee rejected the proposal of putting a limit on the movement of foreign currency within the country.