FATF Retains Pakistan In Grey List

  • The Financial Action Task Force (FATF) has decided to retain Pakistan on the “greylist” till the next review of its performance on its recommendations during the June Plenary session.
  • FATF acknowledged Pakistan’s significant progress in combating terrorism, however it was still to fully comply with three of the 27-point action plan.

BACKGROUND

  • During the October-2020 Plenary, due to the Covid-19 pandemic, Pakistan was given an extension for full compliance with the 27-point action plan till February 2021.
  • It had then not fully complied with 6 of the 27 directives.
  • The FATF had issued the 27-point action plan after placing Pakistan on the ‘Grey List’ in June 2018. 
  • The action plan pertains to curbing money laundering and terror financing.

FINANCIAL ACTION TASK FORCE

  • It is an inter-governmental body established in 1989 during the G7 Summit in Paris.
  • The FATF assesses the strength of a country’s anti-money laundering and anti-terror financing frameworks, however it does not go by individual cases.
  • Its Secretariat is located at the Organization for Economic Cooperation and Development (OECD) headquarters in Paris. 
  • The FATF currently has 39 members including India. 
  • The FATF Plenary is the decision making body of the FATF. 
  • It meets three times per year.

LISTS UNDER FATF

  • Grey List: 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.
  • Black List: Countries known as Non-Cooperative Countries or Territories (NCCTs) are put in the blacklist.
  • These countries support terror funding and money laundering activities.
  • The FATF revises the blacklist regularly, adding or deleting entries.

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