ISLAMABAD: The International Monetary Fund (IMF) has been providing technical assistance to Pakistan with the objective of removing the country from the grey list of Financial Action Task Force (FATF).
This was stated by the IMF resident representative Teresa Daban Sanchez exclusively to Business Recorder on Monday while a senior official of the Finance Ministry claimed that "we are on track in terms of meeting FATF requirements." However, he refused to comment when asked how the government would manage the approval of AML/CFT legislation with thin majority in parliament against stiff resistance from the opposition.
In reply to a question about the resumption of the six billion dollar Extended Fund Facility programme Teresa Daban Sanchez stated "there is no interaction envisaged with the press during discussions".
Sanchez further stated that the IMF team and Pakistani authorities remain closely engaged on working to bring second review of the $6 billion Extended Fund Facility (EFF) to a positive conclusion.
Sources said that: the Finance Ministry recently got approval for FATF related amendments to the companies act 2017 and Limited Liability Act as suggested by the Securities and Exchange Commission of Pakistan (SECP) to address gaps identified by Asia Pacific Group on Money Laundering against FATF recommendation No 24, relating to transparency of legal persons. The government in order to comply with the FATF has drafted an amendment to Section 60 through insertion of Section 60A and section 122 prohibiting issuance of bearer shares, bearer share warrants, same equity or debt securities of bearer nature, as well as the manner of registration and cancellation in case any such bearer securities have been issue. Their introduction would prevent the misuse of companies for money laundering or terrorist financing abuses in line with the recommendations issued by the FATF.
Sources added that a summary was moved by the Ministry of Finance for the Disposal of Legislative Cases (CCLC) and as the CCLC was incomplete, the proposed amendments, therefore, were directly placed before the Cabinet for approval as per rule 16 of Rule of Business. The proposed amendments in both Acts have been vetted by the Law Ministry and the proposed changes have been incorporated.
Sources said that of the total 27 FATF Action Plan, Pakistan has already complied with 14 whereas considerable progress had been made in addressing remaining 13 Action Plan items.
Adviser to Prime Minister on finance Dr Abdul Hafeez Shaikh in his address to a high level panel on International Financial Accountability, Transparency and Integrity for Achieving the 2030 Agenda to contribute to the implementation of the 2030 Agenda for Sustainable Development, stated that Pakistan had taken various measures in recent years to contain illicit financial flows through strengthening of the AML/CFT regulations, AML/CFT Regulations on Customer Due Diligence (CDD), Know Your Customer (KYC)/ and other AML/CFT instructions to financial institutions in line with FATF standards.
The adviser added that to further align with the international standards; the AML Act had been amended to include tax offences as predicate offences. A range of predicate offences have been added to the schedule of AML Act, and include serious offences including corruption, narcotics, terrorism and human trafficking. Shaikah told the panel that violations of Section 4(1) (un-authorized foreign exchange business) and Section 5 (Illegal transfers) of Foreign Exchange Regulation Act (FERA), 1947 had been incorporated into the schedule of Anti Money Laundering (AML) Act, 2010 in terms of which those offences might also be punishable under AML, Act, 2010. The official of finance ministry said that the Central Directorate of National Savings (CDNS) is also being digitalized to meet requirements set by the FATF.
Copyright Business Recorder, 2020
Comments
Comments are closed.