Thread by @hasaankhawar

1/ #FATF plenary begins today. Final decision to be announced on Feb 25. Till now, #Pakistan compliant/largely compliant on 21 out of 27 actions

Plenary WON’T decide on Pakistan getting of #GreyList. At best, it would approve an on-site visit to happen before June.

2/ I wish Pakistan best of luck in FATF

Pak shown remarkable progress. Very close to meeting all 27 actions. Progress will be acknowledged but less chance to approve on-site visit (I hope I’m wrong)

In June, Pakistan likely to get approval for visit & removal from GL in Oct

3/ View from an objective 3rd party “Pakistan unbelievably close to #FATF finish line. But remaining items are core of the process (how Pak prosecutes ML in connection with terrorism)”

But few caveats related to parallel regular evaluation process for ML. More details later

4/ However, unlike last time, Pakistan’s diplomatic efforts were not as robust & mostly last minute. One reason could be that they didn’t want to go to friends, before achieving progress on key FATF actions. GoP arranged bilateral meetings with a few missions around 8-9th Feb

5/ Pakistan's unaddressed FATF action areas from last time

Demonstrate
-Authorities identifying & investigating widest range of TF activities
-TF investigations & prosecutions target designated persons/entities

6/ Pakistan's unaddressed FATF action areas from last time

Demonstrate
-TF prosecutions successfully result in effective/ proportionate/dissuasive sanctions
-Effective implementation of sanctions against assets of DPs/entities in accordance with UNSC Res 1267 & 1373

7/ Pakistan's unaddressed FATF action areas from last time

Demonstrate:
-Enforcement against violations with obligations deriving from UNSC regulations 1267 & 1373
-Authorities applying focused & proportionate measures to persons/entities identified as vulnerable to TF abuse

8/ But getting out of the grey list doesn’t end this journey for Pakistan. The regular evaluation process for money laundering is on the horizon already. Pakistan will have to deal with both the #FATF as well as the new evaluation process. There could be a few options

9/ Option 1: Deal separately- Finish FATF process. Get off grey list. Celebrate & then deal with other evaluation process

Option 2: Merge two processes (especially if delay in getting off grey list)

Option 1 preferable for Pakistan, provided we get on-site visit approval now

10/ Now regular evaluation process for money laundering

FATF updated consolidated assessment ratings on 18th Feb 2021

Countries assessed against 11 immediate outcomes (IOs) for effectiveness & 40 recommendations for tech compliance

Pak rating based on Oct 19 MER & Sep 20 FUR

11/ Money Laundering Assessment: On 11 IOs, #Pakistan has low effectiveness on 10 and moderate on 1.

No area with substantial or high effectiveness.

On 40 recommendations:
4 non-compliant
25 partially compliant
9 largely compliant
2 compliant

12/ Pakistan’s 4 non-compliant areas in Sep 20 (many improved by now)
R22: No enforceable means for DNFBP non-compliance
R25: No requirement for beneficial ownership info for trusts
R28: No designated supervisors for DNFBPs
R38: Absence of mutual legal assistance framework /END