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08 Mar 2022 Pakistan remains in gray list: FATF

Posted at 12:30h in Daily current-affairs by khyati khare 0 Comments

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Recently, the Financial Action Task Force (FATF) has kept Pakistan in the ‘Grey List’ or ‘Increased Monitoring List’. The FATF includes the United Arab Emirates (UAE) with which India signed a free trade agreement in February 2021.
There are 17 countries in the gray list of FATF.
After a review, Zimbabwe has been removed from the list because it complies with all the criteria.

FATF decided to remove existing Pakistan from the category despite meeting 32 action points out of 34.
It said that Pakistan has completed 26 of the 27 work items in the FATF’s 2018 action plan and seven action items of the FATF’s Asia Pacific Group on Money Laundering’s 2021 action plan.
In response to the additional deficiencies identified in Pakistan’s 2019 APG Mutual Evaluation Report in June 2021, Pakistan expressed a high-level commitment to address these strategic deficiencies in accordance with a new action plan, primarily to combat money laundering.
There were two concurrent action plans with a total of 34 action points in the country, 30 of which were addressed either completely or largely to prevent money laundering and terrorist financing.
The FATF encouraged and encouraged Pakistan to continue making progress and efforts to investigate and prosecute the financing of terrorism.
Since June 2018, Pakistan has expressed a high-level political commitment to work with the FATF and APG to strengthen its Anti-Money Laundering/Combating the Financing of Terrorism (AML/CFT) and counter-terrorism financing ties can go.

The FATF released a 27-point action plan in June 2018 after placing Pakistan on the ‘Grey List’. This action plan is related to curbing money laundering and terrorist financing.
Pakistan was first placed on the list in 2008, removed from the list in 2009, and again under surveillance from 2012 to 2015.
Being included in the ‘Grey List’ has adversely affected a country’s chances of getting financial aid from world institutions like International Monetary Fund, World Bank and Asia Development Bank.

FATF was formed in the year 1989 at the meeting of G-7 countries in Paris.
FATF works to generate the necessary political will to bring about legislative and regulatory reforms in the world on issues like money laundering, terror funding. It does not look at individual matters.

The purpose of FATF is to promote the effective implementation of other legal, regulatory and operational measures to combat threats such as money laundering, terrorist financing and the integrity of the international financial system.

Its secretariat is located at the headquarters of the Organization for Economic Co-operation and Development (OECD) in Paris.

Presently FATF consists of 39 member countries including India and 2 regional organizations (European Commission and Gulf Cooperation Council). India is a member of FATF since 2010.

Grey list:

Countries that are considered safe havens to support terror funding and money laundering have been put on the FATF grey list.
Being included in this list serves as a warning to the country concerned that it may be included in the black list.

Black List:

Countries identified as Non-Cooperative Countries or Territories (NCCTs) are included in the Black List. These countries support terrorist funding and money laundering activities.
The FATF regularly revises this list to include or remove countries.
Currently, Iran and the Democratic People’s Republic of Korea (DPRK) are in the High Risk Jurisdiction or Black List.

The FATF Plenary is the decision-making body of the FATF. Its sessions are held three times a year.