Pakistan yet again on EU’s list of weak AML/CFT countries

Published February 14, 2019
The aim of this list is to protect the EU financial system by preventing money laundering, terrorist financing risks. — AFP/File
The aim of this list is to protect the EU financial system by preventing money laundering, terrorist financing risks. — AFP/File

KARACHI: The European Commission (EC) on Wednesday issued a new list of 23 countries, including Pakistan, having weak anti-money laundering and terror financing regimes and asked them to remedy their deficiencies swiftly.

A press release issued by the European Commission in Strasbourg said the aim of this list is to protect the EU financial system by better preventing money laundering and terrorist financing risks.

The 23 jurisdictions listed are: Afghanistan, American Samoa, the Bahamas, Botswana, North Korea, Ethiopia, Ghana, Guam, Iran, Iraq, Libya, Nigeria, Pakistan, Pana­­ma, Puerto Rico, Samoa, Saudi Arabia, Sri Lanka, Syria, Trinidad and Tobago, Tunisia, US Virgin Islands and Yemen.

“As a result of the listing, banks and other entities covered by EU anti-money laundering rules will be required to apply increased checks (due diligence) on financial operations involving customers and financial institutions from high-risk third countries to better identify any suspicious money flows,” said the commission.

The list is based on a new methodology, reflecting stricter criteria of the 5th anti-money laundering directive in force since July 2018 and has been established on an analysis of 54 priority jurisdictions, which was prepared by the Commission in consultation with member states.

For each country, EC assessed the level of existing threat, the legal framework and controls put in place to prevent money laundering and terrorist financing risks and their effective implementation. It also took into account the work of the Financial Action Task Force (FATF), the international standard-setter in this field.

The 23 countries listed were found to have strategic deficiencies in their anti-money laundering and counter terrorist financing regimes, with 12 of them already listed by FATF and 11 by additional jurisdictions. 16 countries listed were already on the current EU list.

The Commission adopted the list as a Delegated Regulation which will now be submitted to the European Parliament and Council for approval within one month. Once approved, it will be published in the Official Journal and will enter into force 20 days after its publication.

The EC will follow up on progress made by listed countries, continue monitoring those reviewed and start assessing additional nations, in line with its published methodology.

Published in Dawn, February 14th, 2019

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