Blessing in disguise

Financial Action Task Force (FATF) has postponed review of Pakistan’s performance report till October, regarding action on the remaining 13 points of action plan to make robust its anti-money laundering (AML) and counterterrorism financing regimes (CTF). The review was scheduled for June 21-26 for which performance report has to be submitted by April 20. Now it will be sent in August for review by the FATF in October. Granting unexpected leash of five months seems to have been necessitated by the global coronavirus pandemic and the watchdog decided to give more time to Pakistan to remove the existing deficiencies in its AML and CTF regimes.In its earlier review of the performance report, the Paris based global watchdog gave Pakistan four months to show total compliance on all 27 points of the action plan for effectively curbing money laundering and terror financing. The required action had been completed on 14 points till February but it was missed on 13 targets. FATF had urged Pakistan for total compliance on all points in its meeting on February 21, failing which the country shall be moved to blacklist. Pakistan would have not been placed on the greylist for the second time, had last PML-N government taken FATF warning of February, 2017, assuring serious consideration of the expected action plan as and when received. On the contrary former Interior Minister Ahsan Iqbal described it a conspiracy to halt progress of what he called booming economy of Pakistan. Former Finance Minister, Miftah Ismael made a tall claim, saying that country’s AML and CTF regimes are very strong and foolproof. In the previous review, eight supplementary points had been given, stressing effective and coordinated actions by the concerned authorities against money laundering and terror financing; concrete investigation against the designated persons and entities believed to be involved in terrorism financing; result oriented prosecution against such designated persons and entities; and effective implementation of targeted financial sanctions, buttressed by comprehensive legal obligations, against all designated persons and entities that fall within the purview of sanctions included in the United Nations Security Council Resolutions numbering 1267 and 1373. In the reaming points, some lay more emphasis on the comprehensive prosecution and penalizing terrorists’ networks. It requires comprehensive legislation to strengthen the institutional and legal frameworks and reforming criminal justice system. The razor thin majority of the government in the National Assembly, minority numerical strength in Senate of the ruling party, and flourishing culture of political expediency in its rank and file make the passage and enforcement of required legislation a difficult task as despite known intention necessary amendment has not been made in the Protection of Economic Reforms Act of July, 1992, a law on the statute book that dilutes the regulatory powers of the central bank regarding transfer of money through foreign currency accounts.