Plenary session from tomorrow: Pakistan hopeful of being taken out of FATF 'grey list'

ISLAMABAD: Pakistan is hopeful to be taken out of the "grey list" of the Financial Action Task Force (FATF) during a virtual three-day plenary session scheduled to begin from October 21 (tomorrow).

The plenary is expected to decide if Pakistan's performance meets its global pledges/commitments on its fight against money laundering and terror financing (ML&TF).

Pakistan hired a leading United States lobbying firm - Linden Strategies - to seek Trump administration's support for the country's quest to be taken off the FATF grey list and an official told Business Recorder that Pakistan's Mission in Washington DC "is intensively in touch not only with the firm but also with the Trump administration authorities to push Pakistan's narrative and its comprehensive compliance with the FATF's Action Plan."

Concerns however remain as in its September 2020 "Mutual Evaluation of Pakistan" report the Asia-Pacific Group (APG) noted that only one technical compliance deficiency has been re-rated as fully compliant.

The report highlighted a number of technical compliance deficiencies that remain including, "allocation of resources and implementation of measures in a risk-based manner to prevent or mitigate ML [money-laundering] risks (other than cash smuggling) is less advanced and Pakistan's FIU, the Financial Monitoring Unit (FMU), was not able to access detailed tax records".

The government recently passed three FATF-related bills, including the amendments in Anti-Terrorism Act, 1997 and anti-Money Laundering Act 2010, and the Islamabad Capital Territory Waqf Properties Bill, 2020, from joint sitting of parliament, which independent lawyers, and noted human rights activists and opposition political leaders fear may be abused by the administration by keeping their opponents and critics in jail and by invasion of privacy.

According to Advocate Colonel Inam-ur-Rahim (retd), these laws are contrary to the fundamental rights guaranteed to citizens in the Constitution, adding the laws which were enacted to get out of the FATF's grey list do not exist in Western countries.

He said citizens' life and properties are protected under Articles 4 and 9 of Constitution. Article 4(2) (a) states, "No action detrimental to the life, liberty, body, reputation or property of any person shall be taken except in accordance with law," while Article 9 states "No person shall be deprived of life or liberty save in accordance with law."

He said the government cannot curtail fundamental rights enshrined in the Constitution adding that "if through subordinate legislation fundamental rights are curtailed then their actions would be challenged in the courts."

Akram Sheikh, a senior lawyer, pointed out that in various countries, including in India and Bangladesh, law enforcement agencies cannot enter any premise without a search or arrest warrant.

In Section 2 (xviii) of Anti-Money Laundering (Second Amendment) Act, 2020 National Accountability Bureau (NAB) has been included as investigating or prosecuting agency with other investigation agencies.

Sheikh said that, in the presence of Federal Investigation Agency (FIA), Anti-Narcotics Force (ANF), Directorate General of (Intelligence and Investigation - Customs) Federal Board of Revenue, Directorate General (Intelligence and Investigation Inland Revenue) Federal Board of Revenue, Provincial Counter Terrorism Departments the inclusion of NAB, 'which has no expertise in terror financing opens the door to political victimization'.

The FATF gave Pakistan a four-month grace period in February 2020 this year to complete its 27-point action plan against ML&TF while noting that Pakistan had delivered on 14 points but missed 13 other targets.

Copyright Business Recorder, 2020