PAKISTAN’S hopes of exiting the so-called FATF grey list have been shattered once again. The global money laundering and terrorist financing watchdog decided to keep the country under enhanced monitoring for another four months at its virtual plenary session on Thursday. But then, we all knew deep down that we’re still some distance away from being taken off the list despite having made considerable progress on the two concurrent FATF and Asia Pacific Group action plans since being put on the grey list in June 2018.
That the FATF has again conceded that the country has moved considerably ahead with the implementation of the action plans given to it to strengthen its anti-money laundering and anti-terror financing framework is perhaps the only consolation for disappointed Pakistanis.
The FATF recognises that Pakistan has addressed or largely addressed 30 out of the 34 items contained in the two FATF/APG action plans of 2018 and 2021 but urges the country to show evidence that it is actively making efforts for adding persons and organisations linked to terrorism to the UN sanctions list. It asks Islamabad to take quick action and to “continue to make progress to address as soon as possible the one remaining CFT [combating the financing of terrorism]-related item by continuing to demonstrate that [terror financing] investigations and prosecutions target senior leaders and commanders of UN-designated terrorist groups”. Thus, the major challenge is to act against these individuals.
Pakistan is also required to demonstrate an increase in money-laundering investigations and prosecutions, and to continue to restrain and confiscate the proceeds of crime and to work with foreign counterparts to trace, freeze and confiscate assets. The question is: are we ready to take these last steps out of the grey list?
The perception in Pakistan that India in particular and Western nations in general have been applying pressure on Islamabad through the FATF/APG forum is not wrong. We have seen the watchdog move the goalposts away in recent months. The statements from India to this effect confirm these perceptions.
Also some nations were let off the hook in the past for doing far less than what Pakistan accomplished in the drive to control illicit flows of money over the last three years. That said, we need to accept the reality that there is no shortcut out of the grey list. We can delay the inevitable but cannot dodge it for very long. At the same time, it should be recognised that the FATF/APG action plan has given Pakistan an opportunity to put its own house in order and to prove that it is willing to do whatever it takes to stop the illegal flows from and into its territory. With the finish line in sight, the quicker we navigate our way through this challenge the better it will be for us.
Published in Dawn, October 23rd, 2021
