The Joint Group of Asia Pacific Group (APG) has informed Pakistan that an assessment of its action plan against eight proscribed terror outfits, including Lashkar-e-Tayyaba and Jaish-e-Muhammad, after it was grey-listed by the Financial Action Task Force (FATF) for terror financing has found that its compliance on 18 of 27 action plans was unsatisfactory.
In its assessment report, sources told The Indian Express, APG specifically demanded stringent actionable steps by Pakistan against Da’esh, Al Qaeda, Jamaat-ud Dawa, Falah-i-Insaniyat Foundation, Lashkar-e-Tayyaba, Jaish-e-Muhammad, Haqqani Network, and persons affiliated with the Taliban, and that its law enforcement agencies show more concrete outcomes on fighting money laundering and terror-financing.
The report, sources said, essentially asks Pakistan to do more until September when the FATF Action Plan is concluded for a final assessment.
This assessment report, which was shared last week with Islamabad, is based on last month’s APG Joint Group meeting in Guangzhou where Pakistan presented its case and provided details of all the actions it had taken in compliance with FATF directions. India’s Financial Intelligence Unit (FIU) Director General was a co-chair at the APG meeting despite Pakistan’s demand for India’s removal from the group while its case was being considered.
While Pakistan will submit its reply to the FATF, it leaves Pakistan with a real danger of being downgraded to the blacklist on terror financing in the upcoming FATF plenary meeting. FATF’s Plenary and Working Group meetings are scheduled to be held in Orlando from June 16 to 21, where such a proposal could be moved.
Pakistan requires votes of at least 15 of FATF’s 36 voting members to move out of the grey list, sources said, and a minimum of three votes to prevent itself from being blacklisted. The FATF plenary meeting at Orlando will decide Pakistan’s future listing even though a formal announcement will only be made at the next FATF plenary scheduled in Paris from October 18 to 23, sources said.
The assessment report assumes significance as FATF had issued a statement in February which stated: “Given the limited progress on action plan items due in January 2019, the FATF urges Pakistan to swiftly complete its action plan, particularly those with timelines of May 2019.”
Besides the economic consequences of being placed on a blacklist, Pakistan has been negotiating a $6-billion loan from IMF to bail it out from low foreign exchange reserves which also seems to be under threat due to the IMF listing. An IMF press release had asked Pakistan to show commitment against money laundering and terror financing, meaning thereby that FATF clearance is mandatory to qualify for the loan programme.
Pakistan was placed on FATF’s grey list for terror financing in June 2018, on a proposal moved by the US, UK, Germany and France. FATF is the global watchdog on anti-money laundering and combating financing terror.