Financial Crime World

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Pakistan’s Struggle to Combat Terrorism Financing and Financial Crime

The country’s efforts to combat terrorism financing and financial crime have been deemed “partially compliant” by international watchdogs, according to a recent report. The Mutual Evaluation 2019, conducted by the Financial Action Task Force (FATF), assessed Pakistan’s implementation of technical requirements aimed at preventing the misuse of its financial system for terrorist activities.

Assessing Risk and Applying Risk-Based Approach

Pakistan has been found partially compliant in assessing risk and applying a risk-based approach to prevent money laundering and terrorism financing. The country needs to strengthen its risk assessment process and ensure that it is effectively applied across all sectors.

  • Strengthen risk assessment process
  • Ensure effective application across all sectors

National Cooperation and Coordination

The report highlights Pakistan’s limited national cooperation and coordination between different agencies, which hinders the effectiveness of its anti-money laundering and combating the financing of terrorism (AML/CFT) efforts.

  • Improve national cooperation and coordination between agencies
  • Enhance information sharing and collaboration

Money Laundering Offence

Pakistan has been found partially compliant in criminalizing money laundering. While it has made some progress, the country needs to strengthen its laws and regulations to prevent the misuse of its financial system for illegal activities.

  • Strengthen laws and regulations to prevent money laundering
  • Improve prosecution and sentencing for money laundering offenses

Terrorist Financing Offence

The report notes that Pakistan has not yet fully criminalized terrorist financing. The country’s legal framework lacks clarity and specificity, which hinders the effective prosecution of terrorist financing cases.

  • Strengthen laws and regulations to prevent terrorist financing
  • Improve prosecution and sentencing for terrorist financing offenses

Targeted Financial Sanctions

Pakistan has been found partially compliant in implementing targeted financial sanctions related to terrorism and terrorist financing. While it has made some progress, the country needs to improve its process for identifying and sanctioning individuals and entities involved in terrorist activities.

  • Improve process for identifying and sanctioning individuals and entities involved in terrorist activities
  • Enhance transparency and accountability in financial sanctions

The report highlights several areas where Pakistan needs to improve its efforts to combat terrorism financing and financial crime. The country’s AML/CFT regime requires significant strengthening to ensure that its financial system is not used to fund illegal activities.

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