FATF adds Turkey to Grey List; Pak retained

Global terror financing watchdog, Financial Action Task Force (FATF), retained Pakistan on the ‘Grey List of countries’.

Key Points

  • This time, the watchdog had added three new countries namely Turkey, Jordan & Mali, to the Grey List.
  • As per FATF, there was no question of blacklisting Pakistan for now as Pakistan is cooperating and only four action items remain to be completed.
  • FATF asked Pakistan to investigate and prosecute UN-designated terror terrorists like Hafiz Saeed and Masood Azhar.
  • It also asked Pakistan to address its strategically important deficiencies.

Background

FATF had retained Pakistan on its ‘Grey List’ in June 2021 as it failed to check money laundering, that lead to terror financing.  Pakistan was first placed on the Grey List in June 2018. Since then, it continues to be in this list as it fails to comply with the mandates of FATF.

What does inclusion in the list mean?

With the placing on the Grey list, it has become increasingly difficult for Pakistan to get financial aid from any international institutions like World Bank, International Monetary Fund (IMF), European Union and Asian Development Bank (ADB).

Financial Action Task Force (FATF)

FATF is an intergovernmental organisation. It was founded in the year 1989 following the initiative of G7 grouping for developing the policies to combat money laundering. FATF mandate was expanded in the year 2001, to include terrorism financing.

Objectives of FATF

The key objectives of FATF include:

  1. Setting standards and promote effective implementation of regulatory, legal, and operational measures to combat terrorist financing, money laundering and other related threats.
  2. Generating necessary political will for bringing national legislative and regulatory reforms across these areas.

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