Govt to address deficiencies in anti-money laundering system
islamabad — Finance Minister Asad Umar has said that the government will address all 27 deficiencies pointed out by the Financial Action Task Force (FATF) in the country’s anti-money laundering system earlier this year.
Addressing the Senate on Friday, Umar said that the National Executive Committee (NEC) headed by him, will review the action plan so as to handle the deficiencies related to currency smuggling and alleged terror financing by proscribed organisations in Pakistan, reports Xinhua news agency.
On June 30, the FATF formally put Pakistan in a grey list and identified it as a country with “strategic deficiencies” in its anti-money laundering and counter-terrorism financing regime, notifying the steps the country must take to address the shortcomings.
Pakistan made a commitment to the action plan, which it would implement over the next 13 months. Failure to negotiate the action plan could lead Pakistan to the blacklist.
The deficiencies identified in Pakistani anti-money laundering and counter-terrorism financing regime include inadequate monitoring and regulatory mechanisms, low conviction rate on unlawful
transactions, poor implementation of UN Security Council resolutions and cross-border illicit movement of currency by terrorist groups.
Umar told the Senate that a FATF delegation visited Pakistan from August 13 to 16, but the visit was not linked with the review of implementation status.
He said the first review meeting would be held in Jakarta on September 11 and 12.
“The government is taking steps to overcome the deficiencies identified by the FATF,” said the minister, adding that Pakistan had reservations about the procedure used for putting the country on the grey list and that there is no chance of any kind of immediate sanctions on Islamabad.
Asad Umar said the government
had decided in principle to launch diaspora and Sukuk bonds besides other initiatives to improve the flow of remittances to the country.
The finance minister said decisions regarding securing loans from the International Monetary Funds (IMF) or other institutions would be taken after consulting parliament.
He pointed out that exports witnessed a decline while imports surged continuously over the last five years, and the government had to obtain loans to fill the gap. “Our effort is to address the root-causes of the loans.”
Asad Umar said that Prime Minister Imran Khan would chair a meeting on Monday to discuss issues relating to currency smuggling and money exchanges. “We have to take definite actions before the next meeting of Financial Action Task Force (FATF).”
The finance minister said the overall situation of remittances’ growth was satisfactory about four years ago, however the situation seemed very bad now.
One of the main reasons in decline of flow of foreign remittances was fiscal and labour reforms introduced in Saudi Arabia and Oman which had affected overseas Pakistanis in these countries, he said.
Responding to a question regarding the involvement of money changers in the illegal means of money transferring, Asad Umar said the area of financial growth was very important for the government.
He informed the Senate that a system of mobile money transferring was being launched which needed to be advertised to get rid of the issues being faced during the money changing process.
Asad Umar said that a meeting would be held next week with the Federal Board of Revenue (FBR) officials to discuss implementation of the reforms strategy.
The minister said that currently one million people were filing their tax returns and there was a potential to further enhance the figure to about three million. — IANS, APP