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Pakistan is reported to have removed around 1,800 terrorists from its watch list, including that of the 2008 Mumbai attack mastermind and LeT operations commander Zaki-ur-Rehman Lakhvi, ahead of a new round of assessments by the global anti-money-laundering watchdog FATF.

The so-called proscribed persons list, which is maintained by Pakistan’s National Counter Terrorism Authority or NACTA, is intended in part to help financial institutions avoid doing business with or processing transactions of suspected terrorists.

Background

  • Pakistan is working to implement an action plan that has been mutually agreed to with the Paris-based The Financial Action Task Force (FATF), part of which involves demonstrating effective implementation of targeted financial sanctions.
  • Currently placed on the FATF’s ‘grey list’, Pakistan has been scrambling in recent months to avoid being added to a list of countries deemed non-compliant with anti-money laundering and terrorist financing regulations, a measure that officials here fear could hurt its economy, which is already under severe strain.
  • It is possible that these removals are part of Pakistan’s action plan to implement the FATF recommendations.

What is FATF?

  • Financial Action Task Force on Money Laundering
  • Is an intergovernmental organization founded in 1989 on the initiative of the G7 to develop policies to combat money laundering
  • In 2001 its mandate expanded to include terrorism financing.
  • It monitors progress in implementing the FATF Recommendations through “peer reviews” (“mutual evaluations”) of member countries
  • The FATF Secretariat is housed at the OECD headquarters in Paris.
  • The objectives of the FATF are to set standards and promote effective implementation of legal, regulatory and operational measures for combating money laundering, terrorist financing and other related threats to the integrity of the international financial system.
  • The FATF is, therefore, a “policy-making body” which works to generate the necessary political will to bring about national legislative and regulatory reforms in these areas
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