The Securities and Exchange Commission of Pakistan (SECP) has ensured that all insurance/takaful companies and insurance brokers should comply with the provisions of the Anti-Money Laundering Act, 2010. It is learnt on Saturday that the Annual Report of the SECP for 2011 has elaborated the compliance with Anti-Money Laundering Act, 2010.
The procedure and manner in which information is to be furnished to Financial Monitoring Unit under the Anti-Money Laundering Act, 2010, are being regularly advised and enforced for all insurance/takaful companies and insurance brokers for due compliance.
The SECP is responsible for strengthen Anti-Money Laundering (AML) regime in Pakistan in the areas under its ambit including; NBFC, brokers, insurance companies and the NPO sector. It liaises with the MOF, the Financial Monitoring Unit (FMU), and the Asia Pacific Group (APG) to deliberate on international AML requirements and assists in implementing the measures.
In order to assist implementation of a robust anti-money laundering regime in the Pakistani capital market, amendments were approved to the Standardised Account Opening Form to make obligatory for members to receive payments of clients above Rs 25,000 through crossed banking instruments only, barring exemptions, report said.
The SECP significantly contributed in drafting the Pakistan National Strategy for AML/CFT (Strategy) regime. This strategy will ensure effective implementation of the AML action plan agreed upon by all stakeholders, including law enforcement agencies, financial sector, regulatory institutions (SECP, SBP), and the private sector. The strategy aims at reforming legal framework of AML/CFT, improve reporting, regulatory and disclosure regime, identify AML/CFT risks and improve capacities and skills of stakeholders. It requires the SECP to effectively implement the AML/CFT regime. After NEC''s approval it will be shared with the FATF/APG as Pakistan''s commitment to achieve full progress in strengthening its AML/CFT regime.
During the year (2010-2011), the SECP made progress on implementation of measures to address the gaps within NBFCs, brokers and insurance sector, as identified by Pakistan''s Mutual Evaluation (ME) on AML/CFT regime, jointly conducted by the APG and the World Bank in 2009. The specific measures to be implemented in this regard include issuance of regulations/directives on Client Due Diligence (CDD)/Know Your Customer (KYC), carry out regular inspections, and establish sanctions regime for non-compliance with the AML requirements.
The SECP has also initiated the process to frame requisite circular/directive for the capital market and insurance sector to strengthen the AML CDD/KYC regime. The SECP is also a member of the Egmont Group Membership Committee that is evaluating the FMU''s membership application. Egmont Group is a forum for Financial Intelligence Units (FIUs). The Committee after deliberations has identified the provisions of the AML Act that have to be brought in line with the international obligations prior to seeking Egmont Group membership.
The Senate Standing Committee on Finance, Revenue, Economic Affairs, Statistics and Planning and Development while recommending the adoption of the AML Bill by the Senate, had advised the MOF to bring about improvements to the AML Act, 2010. The SECP being a member of AML Law Review subcommittee, contributed in the process of amendments/revision of the AML Act. The SECP also initiated work to meet the targets for the actions recommended by the Regional Review Group in their final report. In light of the recommendations of the APG and Regional Review Group (RRG), the SECP has proposed to include insider trading as a criminal offence in the draft Securities Act that on promulgation will replace the Securities and Exchange Ordinance, 1969 (SEO 1969), SECP added.