Cross-border forex transportation: Collectors told to implement WCO recommendations

The government has decided to strictly implement recommendations of the World Customs Organisation (WCO) to control physical cross-border transportation of foreign currency or bulk cash smuggling suspected to be used for terrorist financing and money laundering.
Sources told Business Recorder on Wednesday that the Federal Board of Revenue (FBR) has issued instructions to the Directorate General of Intelligence and Investigation and collectors of customs for compliance with the WCO recommendations. The relevant agencies of Pakistan such as customs department may share information with the WCO on money laundering and cross border transports of bulk cash.
The FBR has asked the collectors to immediately implement the following WCO recommendations relating to cash couriers which includes bulk cash smuggling: Firstly, countries should have measures in place to detect the physical cross-border transportation of currency and bearer negotiable instruments, including a declaration system or other disclosure obligation.
Secondly, the countries should ensure that their competent authorities have the legal authority to stop or restrain currency or bearer negotiable instruments that are suspected to be related to terrorist financing or money laundering, or that are falsely declared or disclosed.
Thirdly, countries should ensure that effective, proportionate and dissuasive sanctions are available to deal with persons who make false declarations or disclosures. In cases where the currency or bearer negotiable instruments are related to terrorist financing or money laundering, countries should also adopt measures, including legislative ones consistent with recommendations, which would enable the confiscation of such currency or instruments, WCO added.
The Directorate General of Intelligence and respective Model Customs Collectorate should implement the recommendations on illicit cash couriers as practically as possible and forward the implementation status thereon to the Board within a fortnight, the FBR added.
Details revealed that the UN had adopted a Convention against illicit trafficking in narcotic drugs and psychotropic substances and passed a resolution to counter the problem of money laundering. Pakistan is a signatory to this Convention. Subsequent to adoption of this Convention, the 7 major industrialised countries and the EC set up a Financial Action Task Force (FATF) which developed a set of 40 recommendations for giving effect to the provisions of 1988 UN Convention.
The FATF currently has more than 33 members including 31 national governments and 2 international organisations. It has more than 20 observers, 5 FATF - Style Regional Bodies (FSRB) and another 15 linked international organisations. Some recommendations of FATF relate to measures to be taken by financial institutions and non-financial businesses and professions to prevent money laundering and transit financing.
Most of the UN members including Pakistan have since taken steps to give effect to provisions of the aforesaid UN Convention and UN Resolution in accordance with FATF recommendation through legislation. Accordingly, Anti-Money Laundering Ordinance (AMLO) was later promulgated.
When aforesaid UN resolution was adopted, at that time the international community was mainly concerned with laundering of money derived from illicit trafficking in narcotics drugs/psychotropic substances. Later, FATF extended its mandate to include the issue of financing of terrorism and developed 9 Special Recommendations on terrorist funding and are complementary to 40 FATF recommendations.
In this regard, the most important of these are on sharing of training and best practices material on detecting cross-border movement of bulk cash/cash couriers through WCO's CEN and other databases, implementation of training initiatives organised by WCO and Interpol and other such specialised anti-money laundering agencies for initiating co-ordinated efforts and setting up of a joint WCO-Interpol informal working group for developing a checklist of measures for effective enforcement of cross border movement of cash.