BISP Enquiries

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Civil Services Preparatory School

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Pakistan
Pakistan Affairs

FATF
Affairs

• The Financial Action Task Force (on Money

Laundering) (FATF), is an intergovernmental
organization  founded in 1989 on the initiative
of the G7 to develop policies to
combat money laundering

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Pakistan
Pakistan Affairs

Objectives
Affairs

• to set standards and promote effective

implementation of legal, regulatory and
operational measures for combating money
laundering, terrorist financing and other
related threats to the integrity of the
international financial system.

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Pakistan
Pakistan Affairs

Procedure
Affairs

• FATF is a "policy-making body" that works to

generate the necessary political will to bring
about national legislative and regulatory
reforms in these areas.
• FATF monitors progress in implementing its
Recommendations through "peer reviews"
("mutual evaluations") of member countries.

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Pakistan
Pakistan Affairs

Recommendations (40+9)
Affairs

• The FATF's 40 ML Recommendations of 1990 are the

primary policies and the Nine Special
Recommendations (SR) on Terrorism Financing (TF).
•  The Recommendations are seen globally as the
world standard in anti-money laundering as well
many countries have made a commitment to put the
Forty Recommendations in place. The
Recommendations cover the criminal justice system
and law enforcement, international co-operation,
and the financial system and its regulation.
• Implement relevant international conventions
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Pakistan
Pakistan Affairs

Recommendations (40+9)
Affairs

1. Criminalise ML and enable authorities to confiscate

the proceeds of ML
2. Implement customer due diligence (e.g., identity
verification), record keeping and suspicious
transaction reporting requirements for financial
institutions and designated non-financial businesses
and professions
3. Establish a financial intelligence unit to receive and
disseminate suspicious transaction reports, and
4. Cooperate internationally in investigating and
prosecuting ML
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Pakistan
Pakistan Affairs

TF
Affairs

• The FATF has issued Special Recommendations

on Terrorist Financing. In October
2001 following the September 11 terrorist
attacks in the United States.
• Among the measures, Special Recommendation
specifically targeted non-profit organizations.
• The Recommendations, and Special
Recommendations were advocated by over 180
countries.
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Pakistan
Pakistan Affairs

Grey List
Affairs

Countries that are considered safe haven for

supporting terror funding and money
laundering are put in the FATF grey list. This
inclusion serves as a warning to the country
that it may enter the blacklist. However, the
country promises and shows will to improve
the situation, monitored through periodic
evaluation.

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Pakistan
Pakistan Affairs

Black List
Affairs

FATF grey lists a country which it considers as a

safe haven for terror funding and money
laundering. ... It is a warning to the country to
tackle the issues. If the country is not actively
tackling money laundering or terror funding, it
is then blacklisted

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Pakistan
Pakistan Affairs

Implications
Affairs

1. No formal international borrowings

2. Financial restrictions
3. International Banking restrictions
4. Financial Isolation
5. Sever economic crunch
6. Hyper Inflation
7. Stagflation
8. International distrust
9. No FDI
10.Collapse
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 THANKS
Thank You

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