ISLAMABAD : The interim finance minister on Friday urged the Asia Pacific Group (APG) on Money Laundering to be flexible in its deadlines given to Pakistan to address legal and administrative deficiencies in Anti Money Laundering (AML) and Counter Terrorism Financing (CTF) frameworks.
“Pakistani authorities should be given full opportunity to provide necessary materials and reports to the APG,” the Ministry of Finance said in a statement issued after a meeting between the APG delegation and Finance Minister Dr Shamshad Akhtar.
The APG delegation came to Pakistan at a time when there is an interim political setup. The next AGP visit is scheduled for October and the new government of the Pakistan Tehreek-e-Insaf (PTI) will have hardly any time to meet the deadlines set to make new laws.
The APG delegation did not have a scheduled meeting with finance minister, which was arranged at the last leg of the visit. A team of the APG Secretariat and International Assessors visited Pakistan from Aug 13-17 2018 in connection with mutual evaluation of the country’s AML and CTF regime. The delegation hoped that all the preparatory work would be completed before the final on-site meeting in October.
The foreign experts found major deficiencies in the legal and administrative frameworks, which according to them can be exploited by the terrorist organisations. They observed that Pakistan’s financial system is not compliant with the AML and CFT regulations.
Moreover, the country needs to legislate to address weaknesses that could hamper progress on Mutual Legal Assistance (MLA) requests and extradition of criminals involved in money laundering and terrorism financing offences.
“The finance minister urged the APG delegation to be flexible and practical in their deadlines and allow full opportunity to the authorities to provide necessary materials and reports to APG,” said the Finance Ministry. It added that Dr Shamshad Akhtar gave a strong sense that the concerned Pakistani authorities would be able to complete their respective tasks as early as possible.
However, the minister particularly highlighted the transition of government in the country as a consequence of the General Election 2018 and maintained that the incoming government would need further time to gear itself with the requirements of mutual evaluation and related matters.
The APG delegation acknowledged Pakistan’s position and advised the authorities to share final reports on technical compliance and effectiveness of implementation with the APG by the end of Aug 2018. The delegation further explained the schedule of activities in connection with the mutual evaluation process.
Dr Akhtar expressed Pakistan’s commitment and full cooperation to work with the APG and the Financial Action Task Force (FATF) and to provide necessary support to the delegation to complete its task of mutual evaluation. The APG’s mutual evaluation report will determine whether or not Pakistan remains in the grey list of the FATF after September 2019.
During its visit, the APG delegation met with the operational teams of different ministries, organisations and authorities concerned with AML/CFT, including ministries of finance, interior, foreign affairs and law & justice, the State Bank of Pakistan, the Securities and Exchange Commission of Pakistan, the National Counter Terrorism Authority (Nacta), the Federal Investigation Agency, FBR, the Anti-Narcotics Force, provincial counter terrorism departments and the Financial Monitoring Unit (FMU).
The Finance Ministry said these meetings enhanced the understanding of the APG delegation on Pakistan’s technical compliance with 40 FATF standards and provided necessary information and clarity in this regard.
The APG delegation explained the FATF assessment methodology, its provisional analysis of Pakistan’s compliance and highlighted the need to provide all relevant materials in support of the compliance position given by Pakistan.
The Pakistani authorities made out a strong case of technical compliance and highlighted various legislative, administrative and regulatory instruments in support of their position.
The APG delegation appreciated the clarifications provided by the Pakistani authorities, which helped it in better understanding Pakistan’s AML/CFT regime, said the Finance Ministry.
Dr Akhtar has advised Ministry of Finance to strengthen capacities of the FMU and also requested all members of National Executive Committee on Money Laundering in its 2nd August meeting to step up their capacities and ensure timely response to FMU on the specific components of Policy Action Plan.
In the August 2 meeting, Nacta had shown its inability to prepare the National Risk Assessment Report due to capacity constraints. Subsequently, Nacta and the FIA decided to pool their resources to complete the task.
(This news/article originally appeared in The Express Tribune on August 18th, 2018)