Good news for Pakistan on the FATF front

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Good news for Pakistan on the FATF front

Asia Pacific Group (APG) on Money Laundering has published results of Pakistan’s second Mutual Evaluation follow-up Report on 2 June 2021.

As per the report, Pakistan has achieved a compliant/largely compliant rating in 31 out of 40 FATF Recommendations in Technical Compliance. These results prove the sincerity along with the resolve of the Government in complying with FATF requirements.

These results are also a manifestation of the irreversibility and sustainability of the complete process in bringing Pakistan at par with Global AML/CFT standards. These results are the manifestation of a whole government approach adopted to achieve the same. An upgrade of 21 Recommendations within this short period of time remains unprecedented in FATF history, said a statement issued by the Ministry of Finance.

“This is the parallel scrutiny being undertaken at FATF besides our current action plan,” wrote Minister for Energy, Hammad Azhar, on his Twitter page on Friday. ------------------------------

He informed that this achievement of the upgrade of 20 criteria in less than two years is unprecedented in FATF history for any country.

“This outcome is a result of major legal reforms (14 federal + 3 provincial laws with corresponding regulations),” he said, adding that it is also due to the persistent efforts of the entire FATF team (20 ministries plus organizations).

FATF’s Mutual Evaluation Report (MER) of jurisdictions is assessed in two domains i.e., Technical Compliance/Legal Instruments (40 FATF Recommendations) and Demonstration of Effectiveness (11 Immediate Outcomes). Pakistan’s MER was adopted in October 2019 in which Pakistan was rated compliant and largely complaint in 10 out of 40 FATF Recommendations for Technical Compliance.

After the adoption of MER, Pakistan was placed under Post Observation Period by FATF which expired in February 2021. During the said period, Pakistan carried out major legal reforms with the enactment of 14 Federal Laws & 3 Provincial Laws along with relevant rules and regulations. The laws not only strengthened the systems in Pakistan but also brought in sustainability. Pakistan submitted its report to FATF on its Technical Compliance on 1st October 2020.

APG has acknowledged that Pakistan has made notable progress in addressing the Technical Compliance deficiencies identified in its MER and has been re-rated compliant/largely compliant in 31 out of 40 FATF Recommendations. Pakistan has also submitted re-rating requests to APG on four more recommendations in the next follow-up report which are under review by APG. The technical upgrades achieved will help manifest the achievement of effectiveness in 11 immediate outcomes of the APG MER process. ------------------------------

As a result of this substantial progress, APG has decided to move Pakistan from enhanced (expedited) to enhanced follow-up; and Pakistan will continue to report back to the APG on progress to strengthen its implementation of AML/CFT measures.