In the wake of ongoing evaluation of Financial Action Task Force (FATF), the State Bank of Pakistan (SBP) has sought help from the Federal Investigation Agency (FIA) to stop the illegal inland movement of foreign currencies. Sources told Business Recorder Friday that the SBP has sent a letter to the FIA requesting immediate action against the culprits involved in illegal movement of foreign currencies.
According to the letter, the smuggling of foreign currencies remains a challenge. The unhindered and unexplained inland movement of such currencies in bulk may serve as the conduit of its smuggling. The motives of such transactions could be manifold including settlement of Hawala transactions, the SBP said.
Further, the inland movement of foreign currencies entails serious risks from the perspective of money laundering and financing of terrorism through provision of such funds in cash to the proscribed individuals or entities. Accordingly, the SBP said that, there is need for a proactive approach to discourage the inland movement of foreign currencies and avert their potential damaging ramifications for our system.
The State Bank has already put in place necessary controls for movement of cash foreign currencies by banks and exchange companies as part of their businesses. To augment these efforts, the SBP has requested the FIA for appropriate action in accordance with law to protect the large national interest where cash foreign currencies in bulk are moved inland by unauthorized individuals or entities based on the safe assumption that this is meant for smuggling and terrorist financing.
According to the SBP, this is also important in the wake of ongoing mutual evaluation by FATF and APG.