New Delhi: Welcoming the ‘grey-listing’ of Pakistan by the global illicit financing watchdog, India hoped on Saturday that Pakistan will honour its commitment on curbing activities of UN-designated terrorists and groups.
At the end of the third plenary meeting, Financial Action Task Force (FATF) president Santiago Otamendi announced the outcomes, which included a separate section on Pakistan.
“FATF has identified Pakistan as a jurisdiction with strategic AML/CFT (anti-money laundering/countering the financing of terrorism) deficiencies,” said the statement.
Inclusion in the ‘grey list’ means that Pakistan’s financial system is seen as a risk for being ineffective in combating terror funding and money laundering. Once placed on the watch list, the country will come under extra scrutiny from the FATF on the implementation of the mutually-negotiated action plan.
Pakistan had previously been on the ‘grey list’ for three years before being removed from the monitoring process in 2015.
The decision to put Pakistan on the ‘grey list’ was taken at FATF’s February plenary, but it came into effect only from June, after the watchdog and Islamabad agreed upon on an ‘action plan’ to address “strategic deficiencies”.
The FATF statement noted that Pakistan had developed “an action plan with the FATF to address the most serious deficiencies”. It pointed out that Pakistan had given a “high level of political commitment” to implement the action plan for removal from the ‘grey list’.
In its response, India welcomed the decision, but also noted that Pakistan has been lax in implementing FATF standards, especially with regard to 26/11 mastermind and UN-designated terrorist Hafiz Saeed, who is being allowed to operate openly.
“Pakistan has given a high level political commitment to address the global concerns regarding its implementation of the FATF standards for countering terror financing and anti-money laundering, especially in respect of UN designated and internationally proscribed terror entities and individuals. The freedom and impunity with which the designated terrorists like Hafiz Saed and entities like Jamaat-Ud-Dawaa, Lashkar-e-Tayabba, Jaish-e-Mohammed continue to operate in Pakistan is not in keeping with such commitments,” said Ministry of External Affairs spokesperson Raveesh Kumar.
He added that India hoped that the “FATF action plan shall be complied with in a time bound manner and credible measures would be taken by Pakistan to address global concerns related to terrorism emanating from any territory under its control.”
The action plan submitted by Pakistan has 26 points, including demonstrating that targeted financial sanctions against all UN-designated terrorists have been implemented.
Pakistan has also committed to taking steps to stop these individuals and groups from raising funds, and freezing their assets.
(8) demonstrating effective implementation of targeted financial sanctions (supported by a comprehensive legal obligation) against all 1267 and 1373 designated terrorists and those acting for or on their behalf, including preventing the raising and moving of funds, identifying and freezing assets (movable and immovable), and prohibiting access to funds and financial services.
UNSC 1267 refers to a resolution passed by the Security Council in 1999 which requires all member states to freeze financial resources of individuals and entities on a list. Two years later, UNSC adopted resolution 1373, which established a counter-terrorism committee and called upon states to deny support to terror groups, including taking effective steps to combat terrorism.
The reference to “comprehensive legal obligation” in the action plan includes pressing charges against and prosecuting these designated terrorists.
The other ‘objectives’ in Pakistan’s action plan include cracking down on “cash couriers” and ensuring that facilities and services owned or controlled by designated terrorists are deprived of resources.
Pakistani foreign office spokesperson Mohammad Faisal said on Friday that inclusion was “nothing new”.
“In February 2018, during the FATF plenary session in Paris, it was agreed that Pakistan will be included in the ‘grey list’ in June 2018. Therefore, what is being reported in media recently is nothing new. It was also agreed in February that an Action Plan would be negotiated between Pakistan and FATF members by June. This has been done. Pakistan will work towards effective implementation of the action plan, while staying in the grey list. A similar situation took place in 2011 when Pakistan was included in the grey list and was taken out in 2015 after it successfully implemented the Action Plan,” said the spokesperson.
On June 8, the action plan was approved by Pakistan’s National Security Council, which includes not just the civilian government but also top military leadership.
Pakistan had taken some steps in the last few months in the run-up to the FATF plenary, which included amending the Anti-Terrorism Act, clamping down on affiliates of the Jamaat-ud-Dawa and approving new regulations.
However, Islamabad’s case was weakened with Saeed publicly entering the ‘mainstream’, with Jamaat-ud-Dawa opening a political office in Lahore and his kin filing nominations to stand for elections.
Jamaat-ed-Dawa chief Hafiz Saeed. Credit: Reuters/Caren Firouz/File Photo
Both Saeed and Lashkar-e-Tayyaba feature in the UN 1267/1989 Committee’s Consolidated List. In 2012, the US treasury department had indicted the Lashkar-e-Tayabba leadership, which includes Saeed’s son Talha Saeed and son-in-law Hafiz Khalid Walid, both of whom are contesting on tickets of the little-known Allah-o-Akbar Tehreek.
The US spearheaded the move which led to the FATF plenary in February assigning Pakistan to the ‘grey list’, despite opposition from some quarters.
On Friday, the US state department spokesperson told PTI that Pakistan needs to take a “number of comprehensive actions on CFT (Combating the Financing of Terrorism) including the raising and moving of funds of UN-designated terrorist groups”.
“We strongly encourage Pakistan to work with FATF and the international community to meet its CFT obligations, including fulfilling its commitments under UN Security Council Resolution 1267 to freeze and prevent the raising and moving of funds belonging to or associated with UN-designated terrorist groups,” added the spokesperson
She welcomed Pakistan’s “high level political commitment” to address the “weakness in its CFT regime”.
China was one of the few countries, along with Saudi Arabia and Turkey, which had opposed the move in February to put Pakistan on the ‘grey list’. However, the US managed to get Saudi Arabia to defect, leaving China and Turkey isolated. This led China to reconsider its position and withdrew its objection, as Beijing’s policy in international organisations has largely been to follow the prevailing consensus. This came as a shock to Islamabad, since China had previously backed Pakistan by not allowing the listing of Jaish-e-Mohammed supremo Maulana Masood Azhar by the UNSC 1267 sanctions committee.
Even as he refused to specifically comment on the decision by the international watchdog, Chinese foreign ministry spokesperson Lu Kang praised Islamabad for having made “enormous efforts and sacrifices”.
“I would like to reiterate that Pakistan has made enormous efforts and sacrifices for the counter-terrorism cause against all odds. The international community should view Pakistan’s counter-terrorism efforts in an objective and impartial way and give Pakistan more recognition and support so as to promote the international counter-terrorism cooperation in a more effective way,” he said.