FATF Puts Pakistan On ‘Enhanced Blacklist’ After Failing To Curb Terror Financing

The Logical Indian Crew

August 24th, 2019 / 12:16 PM

Image Credit: News Nation

Pakistan has received a major jolt from Financial Action Task Force (FATF) managed Asia Pacific Group (APG), which has placed Pakistan on the blacklist.

The Asia Pacific Group, which happens to be one of the nine regional affiliates of FATF has placed Pakistan in the enhanced expedited follow-up list (also known as the blacklist), 

Pakistan was placed on this list after it failed to meet the required standards for combating terrorism and money laundering.

The decision was taken in a review meeting held in Australia’s Canberra on August 22-23, the Pakistani delegation was led by Dr Reza Baqir, the Governor State Bank of Pakistan.

After continuous pressure from countries like the US, France, Germany, the UK, FATF had grey-listed Pakistan in June 2018 stating that it had failed to complete its action plan on terror financing.

APG’s final report, which most probably will be made public after the meeting end, stated that Pakistan failed in 32 out of the total 40 ‘compliance’ parameters for its concerned legal and financial systems.

Pakistan reportedly failed 10 out of 11 ‘effectiveness’ parameters concerned with enforcing safeguards against terror-financing and money-laundering by UN-sanctioned entities.  

Islamabad Submits 450-page Compliance Document

Advocating the efforts that government took against terror-groups in the past 18 months, Islamabad had submitted a 450-page compliance document detailing all the changes that the government made to existing laws.

If the claims made by Pakistan are to be believed, they had charged Lashkar-e-Taiba/ Jamaat-ud-Dawa (JuD) chief Hafiz Saeed with terror financing. They also claimed to have frozen all the assets of JuD and other United Nation Security Council (UNSC) banned outfits, as part of the efforts to crack down the terror.

FATF’s 27-Point Action Plan Set To Review The Compliance Document  

The 27-point action plan is set to decide Pakistan’s fate. It could either remove Pakistan from the greylist or continue to keep it on the greylist. There is also a possibility that the Islamic nation might be blacklisted. The review meetings are scheduled to happen in Bangkok on September 5, and a final decision shall be taken at Paris plenary session on October 18-23.

What Next For Pakistan?

This surely is worrisome news for Pakistan, which now faces the threat of getting placed under FATF’s overall blacklist in October.

Such ranking is bound to worsen Pakistan’s chances of getting loans from International Credit Agencies if downgraded. It will be a fatal blow to Pakistan’s opportunities for attracting foreign investments.

‘India Exploited The Situation’

Pakistan Prime Minister, Imran Khan holds India responsible for getting Pakistan blacklisted.

“We tried really hard to normalise ties with India. But they [India] exploited the situation. They exploited the Pulwama [attack] for their elections. They have been lobbying to get us blacklisted by the FATF (Financial Action Task Force] as well,” Imran Khan said.

He also went on to accuse India of creating a “war-like” situation similar to the post-Pulwama terror attack to divert the world’s attention from the Kashmir issue. 

What Is FATF?

An inter-governmental body established back in 1989, FATF’s task is to ensure strict implementation of legal, regulatory and operational measures to fight money laundering, terrorist financing and the other factors that pose a threat to the integrity of the international financial system.

FATF works in order to generate necessary political will to bring legislative and regulatory reforms. It also keeps a strict check on tracking the progress of its member for the implementation of a necessary measure that is to be taken in order to battle issues like terror financing and money laundering.

The FATF currently comprises of a total of 36 members that have voting powers and also a couple of major regional organisations, representing most of the major financial centres in all parts of the globe.

Also Read: Indian Railways Crew Cross Border To Escort Stranded Samjhauta Express Stopped By Pakistan


Written by : Anushk Kaushik (Intern)

Edited by : Shubhendu Deshmukh

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