The lack of any mechanism to investigate suspected cases of trade-based money laundering (TBML) discovered by Pakistan’s Federal Board of Revenue (FBR) is hindering the country’s attempts to avoid being put on the Financial Action Task Force’s (FATF’s) black list.
Pakistan is currently on FATF’s grey list and has been working to avoid being added to the list of countries deemed non-compliant with anti-money laundering (AML) and counter financing of terrorism (CFT) regulations by the global watchdog on AML/CFT.
Pakistan has been asked to address critical deficiencies in its legislation and regulatory environment to establish and execute effective AML/CFT measures and multiple meetings have taken place to implement the 27-point action plan demanded by FATF.
Pakistan is required to deliver on 10 of these action points by January 2019.
No TBML investigation
One area of critical concern is the FBR’s failure to report suspected TBML to any investigating agency.
Another issue is the lack of direct access by the State Bank of Pakistan to data held by commercial banks.
FATF also wants to see addressed the lack of an institutional mechanism to check and report fake bank accounts.
The global AML/CFT watchdog believes these factors have created conditions for money laundering on a phenomenal scale.
Categories: Trade Based Financial crimes News