Pakistan will complete FATF's anti-money laundering plan in 12 months: Hammad Azhar

• Federal Minister for Energy Hammad Azhar says anti-money laundering plan will be much easier to tackle than the previous counter-terrorism one.
• Azhar assures nation that the anti-money laundering plan will be completed in 12 months; one remaining item of previous plan in 3-4 months.
  
• Minister says Pakistan has not been moved out of the grey list but Pakistan’s progress was noted globally.

After the Financial Action Task Force (FATF) decided to keep Pakistan on the "increased monitoring" list, pending action on one previous item and six new areas on anti-money laundering, Federal Minister for Energy Hammad Azhar expressed confidence that the new action plan on money laundering will be implemented within 12 months.

Azhar, who addressed a press conference in Islamabad shortly after the FATF decision, explained that the body is not like it was 10 years ago.

He explained that in the FATF, all member countries review one country together, and assured everyone that Pakistan is not in the same position as it was two years ago.

“The importance of FATF has increased significantly in the current situation. [And] FATF wants better monitoring of money laundering,” said Azhar.

Read more: FATF lauds Pakistan's progress, but says last remaining action item should be addressed

The minister further explained that the previous action plan that Pakistan was given was based on counter-terror financing. He added that Pakistan has implemented 26 out of the 27 points, and said that the last point will be implemented as well, providing "3-4 months" as the timeline for completion.

The next plenary meeting is due to take place in October.

“The previous action plan was for counter-terrorism and the new one is for anti-money laundering,” said Azhar, adding that the anti-money laundering plan will be much easier to tackle than the counter-terrorism one.

The energy minister assured the nation that the federal government would implement the points mentioned in the anti-money laundering plan "in the next 12 months".

“Pakistan has not been moved out of the grey list but Pakistan’s progress was noted globally,” said Azhar, speaking about the plenary meeting which was held between June 21 and 25 in Paris.

The energy minister said that “Pakistan has implemented the most difficult FATF action plan” and its efforts are being acknowledged the world over today.

Read more: With compliance on 26 points, no justification to keep Pakistan in FATF's grey list, says Qureshi

“FATF acknowledged that Pakistan implemented 26 out of 27 points. One point is left and we will complete that as well. There is no threat of blacklisting; Pakistan will not be blacklisted, it will be whitelisted,” said the minister confidently.

FATF lauds Pakistan's progress, but says last remaining action item should be addressed

Earlier today, the FATF said that it recognises Pakistan's progress and efforts to address items in its country action plan that pertain to combating financing of terrorism and encouraged it to continue progress and address as soon as possible "the one remaining CFT-related item".

Addressing a press conference after the plenary meeting, FATF President Dr Marcus Pleyer said that Pakistan remains under "increased monitoring".

"The Pakistani government has made substantial progress in making its counter-terrorist financing systems stronger and more effective. It has largely addressed 26 out of 27 items on the action plan it first committed to in June 2018," he said.

Dr Pleyer said that the plan focused on terrorist financing issues.

He said that the one key action item still needs to be completed "which concerns the investigation and prosecution of senior leaders and commanders of UN designated terror groups".

Read more: FATF's Asia-Pacific Group acknowledges Pakistan's progress in fight against money laundering

The FATF president highlighted that Pakistan has "made improvements" after the Asia Pacific Group highlighted issues in 2019 during its assessment of Pakistan's entire anti-money laundering and counter terrorist financing system.

"These include clear efforts to raise awareness in the private sector to Pakistan's money laundering risks and to develop and use financial intelligence to build case.

"However Pakistan is still failing to effectively implement the global FATF standards across a number of areas. This means the risks of money laundering remain high which in turn can fuel corruption and organised crime," he said.

Dr Player said that this is why the FATF has worked with the Pakistan government on new areas that still need to be improved as part of a new action plan that largely focuses on money laundering risks.

This includes increasing the number of investigations and prosecutions and making sure law enforcement agencies cooperate internationally to trace, freeze and confiscate assets, he said.

Read more: The path out of the FATF 'grey list'

"This is about helping authorities stop corruption and prevent organised criminals from profiting from their crimes and undermining the financial system and legitimate economy in Pakistan," Dr Pleyer added.

He went on to say he wishes to "thank the Pakistani government for their continued strong commitment to this progress".

FATF recognises continued political commitment

In a statement issued after the meeting, the FATF said that since June 2018, when Pakistan made a high-level political commitment to work with the FATF and APG to strengthen its AML/CFT regime and to address its strategic counter-terrorist financing-related deficiencies, "Pakistan’s continued political commitment has led to significant progress across a comprehensive CFT action plan".

"The FATF recognises Pakistan’s progress and efforts to address these CFT action plan items and notes that since February 2021, Pakistan has made progress to complete two of the three remaining action items on demonstrating that effective, proportionate and dissuasive sanctions are imposed for TF (terror financing) convictions and that Pakistan’s targeted financial sanctions regime was being used effectively to targeted terrorist assets," the statement read.

FATF noted that Pakistan has now completed 26 of the 27 action items in its 2018 action plan.

Read more: Ahead of FATF review, FBR asks jewellers to keep record of cash transactions

"The FATF encourages Pakistan to continue to make progress to address as soon as possible the one remaining CFT-related item by demonstrating that TF (terror financing) investigations and prosecutions target senior leaders and commanders of UN designated terrorist groups," said the statement.

According to the anti-money laundering watchdog, in response to additional deficiences later identified in Pakistan’s 2019 APG Mutual Evaluation Report (MER), "Pakistan has made progress to address a number of the recommended actions [...] and provided further high-level commitment in June 2021 to address these strategic deficiencies pursuant to a new action plan that primarily focuses on combating money laundering".