KARACHI, Oct 9: The consultative group on money laundering met here on Thursday for the first time and discussed in detail how money laundering could be attacked by the regulators as well as by the market players.

The meeting presided over by Securities and Exchange Commission of Pakistan chairman Dr Tariq Hassan urged upon the financial institutions that they should fully adhere to KYC or Know Your Customer regime, a source close to the meeting said.

The group formed by the SECP to provide a platform for recommending and providing policy direction on anti-money laundering initiatives also reviewed the arrangements made by the financial institutions for checking money laundering.

The group comprising senior officials of the SECP and the State Bank and having representations from the corporate sector recognized that the capacity of the regulators to counter money laundering, is being beefed up and a legislative framework is being developed to prevent the same, says a press release.

The group noted that a number of measures have already been initiated, including the requirement for shares to be on the central depository system, introduction of KYC forms and licensing of foreign exchange companies. These measures when fully accomplished would help in substantially preempting money laundering.

The regulators have also undertaken to create awareness in the corporate sector and among key stakeholders on the concept of money laundering, countering the same and implications of legislative requirements and international obligations.

The group decided to examine in detail the international obligations to identify the strategy for adopting international standards without compromising the genuine business needs. The group agreed that a balanced strategy should be defined for anti money laundering.

The issue of money laundering has become critical in Pakistan in the wake of the US-led war against terrorism in this region. The US and other nations engaged in this war are trying to block financial support to those who they think are involved in terrorist activities. Pakistan is cooperating with these nations.

The World Bank and the IMF have also been insistent in their demand that Pakistan should do more to check money laundering.