Pakistan likely to remain on FATF greylist, say sources

Pakistan likely to remain on FATF greylist, say sources

In latest review, Islamabad cleared only 21 of 27 action points on terror financing

Pakistan is unlikely to exit the Financial Action Task Force (FATF’s) greylist next week, when the plenary session of the Paris-based global terror-financing watchdog is held, after its latest evaluation saw it clear 21 of 27 action points, with six key areas outstanding where Pakistan has yet to show progress.

According to sources, there is still no consensus amongst the 39-member FATF, which includes the U.S., U.K., France, Germany, China and Russia, to blacklist Pakistan, despite its failure to meet its original deadline in September 2019, which would mean the group would maintain status quo and continue Pakistan on the greylist until February 2021.

On Tuesday, the International Co-operation Review Group (ICRG) of the FATF held a meeting to discuss the final recommendation to the watchdog’plenary session on October 21-23.

“Much will depend on the approach adopted to review the performance. Rather than going by mere statistics, if the member nations take cognisance of the inaction in cases like 26/11 Mumbai attacks, Pulwama attack and the Daniel Pearl murder case, an explanation may be sought from Pakistan,” a government official told The Hindu. He added that the decision by U.S. and European countries would be key.

At the plenary next week, Pakistan needs at least 3 of 39 members to keep it off the blacklist, and the support of 12 of 39 members to exit the “greylist”.

Last week Pakistani media reported that Foreign Minister Shah Mehmood Qureshi had telephoned his counterparts in several countries including Turkey, Malaysia and Saudi Arabia, in an effort to “apprise” them of steps taken by Pakistan to comply with the FATF’s demands. On Sunday, Mr. Qureshi even claimed that Pakistan would be off the FATF greylist “soon”.

In the past two months, the Imran Khan government has brought eight new laws to parliament in an effort to enhance its rating with the FATF.

However, it is the support of the United States, considered crucial, that has not yet swung in favour of Pakistan, despite some hopes in Islamabad that cooperation in pushing talks between the Taliban and the Afghan government would help its chances at the FATF.

The six points of failure in the FATF’s 27-point action list include Pakistan’s lack of action against charitable organisations or NPOs (Non-profit organisations) connected to terror groups banned by the UN Security Council, and delays in prosecution of banned individuals and entities like Lashkar e Toiba chief Hafiz Saeed and LeT operations chief Zaki Ur Rahman Lakhvi, as well as Jaish-e- Mohammad chief Masood Azhar.

While Saeed was sentenced in February this year to 11 years in prison for terror financing, and remains behind bars, the Pakistan government claims the others are “untraceable”.

There have been few convictions of terror commanders of UN-designated entities affiliated to the Al Qaeda and the Haqqani network, and Pakistan has been found non-compliant in cracking down on terror financing through narcotics and smuggling of mining products including precious stones.

The FATF process has also shown concern about 4,000 names that were on Pakistan’s Schedule-IV list under the Anti-Terrorism Act (ATA) being dropped in 2019.

Meanwhile, Pakistan’s chances at exiting the greylist suffered another blow as the APG released its evaluation of Islamabad’s actions in complying with the FATF, clearing it on only about 11 of 40 parameters. The APG review, that only takes into account actions taken until February 2020, decided to recommend Pakistan be kept in “expedited (enhanced) Follow Up (EEFU), which means more regular scrutiny of its government’s progress, in addition to its FATF greylist commitments.

The greylist refers to countries that are “monitored jurisdictions”, while the blacklist refers to countries facing a “call to action” or severe banking strictures, sanctions and difficulties in accessing loans. In February this year, the FATF had threatened Pakistan with a potential blacklist in a sternly worded note that said, “All deadlines in the action plan have expired.”

Your email address will not be published.