State Bank, FIA join hands against money laundering, cyberattacks

Published November 21, 2021
KARACHI: SBP Governor Dr Reza Baqir, FIA director-general and bank presidents discuss measures to strengthen and coordinate efforts to fight money laundering, cyberattacks and online frauds on Saturday.
KARACHI: SBP Governor Dr Reza Baqir, FIA director-general and bank presidents discuss measures to strengthen and coordinate efforts to fight money laundering, cyberattacks and online frauds on Saturday.

KARACHI: The State Bank of Pakistan (SBP) and the Federal Inve­stigation Agency (FIA) will strengthen coordination against money laundering, digital frauds and cyberattacks, it was decided on Saturday.

The central bank governor while chairing a meeting emphasised the need for close cooperation among banks, SBP and FIA to expeditiously investigate white-collar crimes and apprehend and prosecute the fraudsters.

The meeting was attended by FIA Director General Sanaullah Abbasi, bank presidents and senior SBP and FIA officials. Pakistan has been actively trying to fix its financial monitoring mechanism, especially since the country’s inclusion in the grey list of Financial Action Task Force (FATF) three years ago.

FATF placed Pakistan on its grey list of countries with inadequate controls over terrorism financing in 2018, which made foreign firms more cautious about investing in Pakistan.

Accord on fast-paced probe into white-collar crimes

The country has been trying hard to come out of the list but it has been unable to convince the watchdogs closely monitoring the country’s financial transactions.

In its latest announcement on Oct 21, FATF announced that Pakistan will remain on its grey list.

Announcing the decision, FATF President Dr Marcus Pleyer said that Pakistan had to complete two concurrent action plans with a total of 34 items. The country has so far addressed or largely addressed 30 items.

The State Bank said it has taken several measures in the recent past to strengthen its work on anti-money laundering as well as taken regulatory and supervisory measures to improve banks’ controls to prevent digital and social engineering frauds.

“In addition to better controls at the level of Financial Institutions and enhanced customers’ awareness, effective investigation and prosecution of criminals is needed to substantially reduce incidences of money laundering, digital frauds and cyberattacks,” the SBP said.

Just last month, the National Bank of Pakistan faced a cyberattack that disrupted its payment system for a few days, exposing the increasing risk of digital threats for financial businesses. However, the bank reported no data or financial loss.

The FIA team offered support in strengthening cyber security at banks and suggested that banks should carry out an information security audit of their systems.

Welcoming the suggestion, the SBP informed the agency that as per existing regulations banks are required to regularly carry out their information system audit and penetration testing. However, this would be re-emphasised to the industry through Pakistan Banks Asso­ciation.

The meeting identified key follow-up areas and associated timelines for strengthening cooperation between SBP, FIA and banks in this regard.

Published in Dawn, November 21st, 2021

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