ISLAMABAD: Finance Minister Asad Umar told the National Assembly on Thursday that there is no data presently available on the volume of money laundered from the country.

In a written response to a question from MNA Farooq Azam Malik in a question and answer session, Mr Umar also told the house that various steps are being taken to stop this practice.

Last year, the United States Department of State’s International Narcotics Control Strategy Report said that money laundering costs Pakistan more than $10 billion a year.

In his reply, Mr Umar said the previous government took various steps to end money laundering, including the 2007 Anti Money Laundering Ordinance – which was transformed into the Anti Money Laundering Act 2010 in line with recommendations from the Financial Action Task Force (FATF).

He said an independent administrative financial intelligence unit, the Financial Monitoring Unit, was created in pursuance of the act.

He said the PTI government has begun extensive consultations to prepare amendments in the Anti Money Laundering Act, the 1947 Foreign Exchange Regulation Act, the 1992 Protection of Economic Reforms Act and the 1974 Federal Investigation Agency Act to curb the practice of hundi and hawali, which play a major part in money laundering.

“The government intends to place amendment bills in this regard before the parliament soon. State Bank of Pakistan has also taken various steps to curb money laundering in financial institutions,” the minister said in his response.

To another question, from MNA Nafeesa Inayatullah Khan Khattak, Mr Umar said the government was fully aware that the smuggling of foreign currency, particularly the US dollar, may create financial instability in Pakistan’s economy.

He said the government had accordingly introduced measures to effectively address this phenomenon of illegal movement of foreign currency.

“The Federal Board of Revenue has also initiated administrative measures to further strengthen the enforcement of laws,” he said.

To a question from MNA Seemi Bokhari, he said the FBR was taking all possible measures to obtain information on Pakistani nationals’ assets in other countries for the application of tax laws.

“Other agencies in government are working on Asset Recovery. Upon receipt of actionable tax information about Pakistani tax-resident persons, if the funds remitted out are found to be non-tax paid/unexplained, tax demand would be raised and recovered. For this purpose FBR is relying on Multilateral Convention on Mutual Administration Assistance in Tax matter of which Pakistan is also signatory,” he said.

Adding that the multilateral convention is an Organisation for Economic Cooperation and Development (OECD) initiative geared at combating tax evasion through the exchange of information amongst signatory states, he said that Pakistan has already invoked Article 5 of the convention and sought information from over a dozen jurisdictions about Pakistanis who may have stashed funds therein.

Pakistan is now in position to mutually exchange bank and financial accounts information with around 50 jurisdictions under the OECD’s common reporting standard. The first data exchanges under this framework took place on Sept 30, this year.

Published in Dawn, November 2nd, 2018