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Pakistan on FATF grey list, gets 4 months to toe action plan

Pakistan’s presence in the grey list makes it difficult for the country to get financial aid from the IMF, the World Bank and the European Union, affecting its economy which is already facing a crisis.

, ET Bureau|
Last Updated: Feb 22, 2020, 07.21 AM IST
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Reuters
Pakistan's national flag
People are seen behind a gate depicting Pakistan's national flag in Torkham, Pakistan, December 3, 2019.
NEW DELHI: Financial Action Task Force (FATF) warned Pakistan of serious action during its plenary meeting held in Paris from February 16-21, 2020.

Islamabad continues to remain on grey list and has been directed to complete its 27-point action plan by June 2020, failing which FATF would urge its members to advise their financial institutions to give special attention to business relations and transactions with Pakistan for blacklisting.

“Pakistan is yet to implement almost half of its action plan. FATF had strongly asked Pakistan to swiftly complete its full action plan by June 2020 and further warned that if significant and sustainable progress, especially in prosecuting and penalising terrorist financing of groups like the Lashkar-e-Taiba (LeT), Jaish-e-Mohammad (JeM) and Hizbul Mujahideen, the FATF will take action which could include blacklisting,” said a western diplomatic source.

Pakistan’s presence in the grey list makes it difficult for the country to get financial aid from the IMF, the World Bank and the European Union, affecting its economy which is already facing a crisis.

The anti- terror watchdog further directed Islamabad to identify and take enforcement action against illegal money or value transfer services, prosecute terror financing cases, effectively implement targeted financial sanctions against all 1267 and 1373 designated terrorists and ensure that facilities and services owned or controlled by designated person are deprived of their resources and the usage of the resources among others.

It noted that Pakistan addressed only a few of the 27 tasks given to it by September 2019. As many as 12 of the 39 votes in the FATF are required to move out of the grey list. Pakistan was placed on the grey list by the watchdog in June 2018 and was given a plan of action to be completed by September 2019, or face the risk of being blacklisted.

At the FATF review meeting held in Beijing on January 21-23, Pakistan had submitted a 125-page report that does not include 500 pages of annexures to show the steps it had taken in the past six months to control terror financing.

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