'Greylist exit no immunity': FATF's warning to Pakistan on terror finance

FATF warns Pakistan that leaving the greylist in 2022 does not stop terror funding risks; country must continue measures to prevent money laundering and terror finance

The Financial Action Task Force (FATF), the international watchdog monitoring terror financing and money laundering, has cautioned Pakistan that being removed from its ‘greylist’ in October 2022 does not make it immune to financial crimes.

 

FATF President Elisa de Anda Madrazo said countries must continue strengthening their systems to prevent criminal activities, including money laundering and terror financing.

 

“Any country that is on the grey list is not bulletproof for actions of criminals, either money launderers or terrorists. So we do invite all jurisdictions, including those who have been delisted, to continue their good work to prevent and deter crimes,” Madrazo said during a press conference in France.

 

Pakistan under regional monitoring

 

Although Pakistan was taken off the FATF greylist in 2022, it remains under follow-up to ensure full implementation of anti-terror financing measures. Since Pakistan is not a FATF member, the Asia Pacific Group (APG) continues to monitor its compliance.

 

Madrazo explained that the list includes countries facing “significant strategic deficiencies” in combating terror financing and money laundering.     

 

India flags Pakistan as high-risk source

 

Her comments come amid reports that terror outfit Jaish-e-Mohammad (JeM) has been using digital wallets to mask financial flows and fund training camps. India’s National Risk Assessment 2022 also identifies Pakistan as a major source of terror financing in the region.

 

A separate FATF report titled ‘Comprehensive Update on Terrorist Financing Risks’ detailed how state-sponsored entities are increasingly involved in terror funding. A study co-authored by India highlighted risks posed by Pakistan’s state-owned National Development Complex, calling the country a “high-risk jurisdiction” for proliferation financing.

 

FATF vows stronger global standards

 

Madrazo reiterated that FATF remains committed to combating terrorist financing worldwide. “Now, as it relates to terrorist attacks, in any place or jurisdiction, the FATF remains committed to continuing to strengthen our standards and the implementation through our assessment and our process to make sure we can benefit the people by having less terrorist financing,” she said.

 

The remarks came after FATF’s fourth plenary meeting held in Paris under Madrazo’s presidency. Delegates from more than 200 jurisdictions and observer organisations met over three days to discuss key global financial crime challenges.

 

The FATF also announced that Burkina Faso, Mozambique, Nigeria, and South Africa have been removed from its list of jurisdictions under increased monitoring after completing their action plans.

 

(With agency inputs)