Pakistan faces blacklist threat if…

0
24

Nation special report
WASHINGTON: June, this year, is likely no favourite for Pakistan and it may find itself on the blacklist of a global financial watchdog if it does not prepare a comprehensive action plan to eradicate terrorist financing by June.
The 37-nation Financial Action Task Force (FATF) held its plenary meeting in Paris last week where it placed Pakistan on a watch list of the countries where terrorist outfits are still allowed to raise funds.
On Friday, the group issued an updated grey list, along with a statement announcing the decisions taken at the plenary session, and Pakistan was not on the list. Officials in Islamabad interpreted this as a “breather”, although it’s more of a technical detail.
The grey list identifies the “jurisdictions with strategic anti money laundering/countering the financing of terrorism deficiencies for which they have developed an action plan with the FATF”. Pakistan has not yet worked out the proposed plan with the FATF and that’s why it’s not on the list. The FATF carries out an in depth study of the financial system of a country – known as “mutual evaluation” – as part of the process to avoid blacklisting.
The next evaluation starts in April, which may take 18 months, and will be followed by another 12 months of analysis. A mutually agreed action plan for overcoming “strategic deficiencies” would become operative at the end of evaluation. Between now and June, Pakistan will have to work out the details of the evaluation process with the FATF and a failure to do so could trigger another process, which may push Pakistan on the blacklist of wilful violators.
Usually, the FATF waits for a mutual evaluation report before starting the listing process but in Pakistan’s case, the group took an unprecedented step when it agreed to debate a US proposal, backed by Britain, France and Germany, to nominate Pakistan as a country having “strategic deficiencies” in “countering financing of terrorism”.
“The move was against the understanding given to Pakistan that Islamabad will be asked to work with the FATF on an action plan, before the listing process starts,” an official source told Dawn. The Paris plenary held its first meeting on Pakistan on Feb 20 where China, Turkey and Saudi Arabia, which was representing the Gulf Cooperation Council (GCC) as it’s not a full member, opposed the move to place Pakistan on the watch list.
But the US pushed for an unprecedented second discussion on Pakistan, held on Feb 22. By then, Washington had convinced Riyadh to give up its support to Pakistan in return for a full FATF membership. This left only two – China and Turkey – in the Pakistan camp, one less than the required number of three members to stall a move. At this stage, the Chinese informed Islamabad that they were opting out as they did not want to “lose face by supporting a move that’s doomed to fail”, another official source told Dawn.
“Pakistan appreciated the Chinese position and conveyed its gratitude to Turkey for continuing to support Islamabad against all odds,” the source added. After the Feb 20 meeting, Foreign Minister Khawaja Asif sent out a celebratory tweet, saying that Pakistan had won a three month reprieve.
Hours after the tweet, US State Department Spokesperson Hea¬ther Nauert indicated at a news briefing in Washington that Islamabad’s celebrations were premature. She said the Paris plenary was not over yet and it would hold another meeting on Pakistan on Feb 22, as it did. She also mentioned Hafiz Saeed and his activities while detailing US complaints against Pakistan and the sources that spoke to Dawn after the Feb 22 meeting said that indeed Hafiz Saeed and his “charities” were top on the list of the groups that the FATF wanted Pakistan to act against.
Pakistan did make some laws before the Paris meeting that would allow it to act against these groups but apparently that was not enough to convince the FATF. Pakistan was first put on the FATF grey list in 2012 but was removed in 2015, after the FATF certified that Islamabad had done enough to counter terror financing. Now, Pakistan will have to follow the same process that it did in 2015, starting with an action plan that Islamabad is required to submit in May.
If the FATF approves the action plan in June, it will make a formal announcement about placing Pakistan on the grey list. Should Islamabad fail to submit an action plan, or if the FATF does not accept it, the group can place Pakistan on its black list, along with North Korea and Iran. Dr Muhammad Faisal ISLAMABAD: Pakistan has confirmed of facing threat of on a ‘grey list’ of the Financial Action Task Force (FATF).The Foreign Office spokesman Dr Muhammad Faisal said here on Wednesday that in June the country is set to be added to the watch list of countries where banned militant outfits have allegedly been raising funds. Speaking at a weekly news briefing, Dr Muhammad Faisal revealed that a decision to place Pakistan on the watch list was taken at the FATF plenary held in Paris last week.
He, however, ruled out the possibility that Pakistan could even be placed on the international watchdog’s blacklist over a lack of compliance. An action plan to eradicate terrorist financing is being prepared and will accordingly be shared with the international body, he said. “Pakistan will be assigned to the ‘grey list’ in June, once an action plan has been mutually negotiated,” the spokesman said, adding that Pakistan will cooperate with FATF in every possible way. Dr Faisal said reports claiming that Pakistan will be transferred from the ‘grey list’ to the blacklist in June are not true as the FATF website clearly demarcates the countries in the blacklist as those which are non-cooperative with the body. In response to a question, the spokesman said the FATF has highlighted certain deficiencies in Pakistan’s anti-money laundering and anti-terror financing regimes.
He said Pakistan has already taken steps to remove the deficiencies in these areas and cited the presidential ordinance that was quietly passed days before the FATF plenary to amend the anti terror legislation in order to include all UN-listed individuals and groups in the national listings of proscribed outfits and persons. “We will take further actions for addressing any remaining deficiencies,” Dr Faisal said. All matters related to FATF will be dealt with by the finance ministry, the FO spokesman said, adding that he could not comment on FATF’s internal deliberations as they are confidential.
The 37-nation FATF plenary held its first meeting on Pakistan on February 20 where China, Turkey and Saudi Arabia, which was representing the Gulf Cooperation Council (GCC), opposed the US-led move to place Pakistan on the watch list. But the US pushed for an unprecedented second discussion on Pakistan, held on February 22. By then, Washington had convinced Riyadh to give up its support to Pakistan in return for a full FATF membership.
This left only two – China and Turkey – in the Pakistan camp, one less than the required number of three members to stall a move. At this stage, the Chinese informed Islamabad that they were opting out as they did not want to “lose face by supporting a move that’s doomed to fail”, an official source had told Dawn. “Pakistan appreciated the Chinese position and conveyed its gratitude to Turkey for continuing to support Islamabad against all odds,” the source added. Pakistan was first put on the FATF grey list in 2012 but was removed in 2015, after the FATF certified that Islamabad had done enough to counter terror financing.
Now, Pakistan will have to follow the same process that it did in 2015, starting with an action plan that Islamabad is required to submit in May. If the FATF approves the action plan in June, it will make a formal announcement about placing Pakistan on the grey list. Should Islamabad fail to submit an action plan, or if the FATF does not accept it, the group can place Pakistan on its blacklist, along with North Korea and Iran.