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In the grey zone

Can recent action against banned militant groups, including the JuD, help Pakistan avoid black listing by FATF?

In the grey zone
— Photo by Rahat Dar

Does the recent action of the CTD (Counter-Terrorism Department) to book JuD’s (Jamaat-ud-Dawa) top leadership, including its chief Hafiz Saeed and naib emir Abdul Rehman Makki, in nearly two dozen cases on terror financing and money laundering under the Anti-Terrorism Act, 1997, reflect a shift in state policy? Is Pakistan finally taking the FATF warnings seriously?

Pakistan may be put on the FATF’s (Financial Action Task Force) black list at a meeting to be held in October 2019. Should that happen, Pakistan will be the only third country on the black list, along with Iran and North Korea.

“Pakistan does not either appreciate or chooses not to acknowledge the transnational, trans-border terrorist financing risk they face,” said Marshall Billingslea, the outgoing FATF president in a press briefing after the FATF plenary last month in Orlando, US. According to him, Islamabad has failed to meet its commitments in almost every aspect.

The authorities barred JuD chief Hafiz Saeed from leading prayers at the Jamia Masjid Qadsia at Chowburji Chowk earlier this year.

The authorities barred JuD chief Hafiz Saeed from leading prayers at the Jamia Masjid Qadsia at Chowburji Chowk earlier this year.

FATF, the Paris-based anti-money laundering watchdog, placed Pakistan on its grey list in June 2018. It also asked Pakistan to implement an action plan to address the issues of money laundering and terror-financing.

A former head of the NACTA (National Counter Terrorism Authority) and a former inspector general Punjab Police, Khawaja Khalid Farooq, says, “the US is pushing Pakistan to the wall.” He adds, Pakistan’s security index today is far better than 2015 and the state has taken serious steps to reduce financing of terror and money laundering. “Opportunities for the miscreants have been squeezed tremendously.”

“General Javed Bajwa’s latest statement about improving peace and stability in the region to usher in economic prosperity carries hope for the country. It’s an act of valour, as it might result in a security threat for him,” says analyst Khaled Ahmed. Besides, he adds, there is unavoidable reality of the “increasing pressure from international community”.

He further adds, “In the past, the banned groups have been used against India as a part of the policy. Our political leaders have tried on several occasions to alter the policy. They have been unsuccessful in these attempts because of the Pakistan Army’s security and regional strategies.”

Pakistan has been on the FATF grey list between 2011 and 2015. It has also faced the threat of being placed on the black list. Some analysts warn that this time, it will be harder to avoid the black list — because some international powers are no longer willing to help us.

According to Khaled Ahmed, China has asked Pakistan several times in the past to take serious action against those who are involved in terror financing and money laundering. “China has enough evidence on such elements. They have established links with Muslims in Xinjiang province and have been causing security concerns for China.”

According to Farooq, India and the US are using their diplomats to influence other members of the APG and the FATF to put Pakistan on the black list. “It’s hard to believe that despite Afghanistan’s high financing of terror and money laundering rating, it’s still not on the grey list. This shows that both the US and India are loyal to their ally”.

Farooq was referring to the Basel AML Index 2018, published on October 9, and prepared by Basel Institute on Governance. It is an independent annual ranking that assesses the risk of financing of terror and money laundering around the world. The ranking is established by evaluating 14 indicators. According to its 7th edition, Pakistan stands at the 25th position out of 129 countries and it has been 46th in the position in the 6th edition.

The role of Asia Pacific Group (APG) is important. The Group is FATF’s regional body consisting of 42 members, Pakistan being one. India held the rotating co-chair appointment from 2010-2012. It is important to remember that apart from FATF’s 27 points Action Plan, APG has come up with a 40-point action plan based on the commitments given by Pakistan.

Pakistan Institute of Peace Studies (PIPS) director Muhammad Amir Rana, says: “Pakistan must implement the action plan it has proposed. Perhaps the plan was too ambitious in the first place.”

The FATF requires a country to set its own targets and commit to achieve them. Once they are submitted to the task force they must be honoured.

FATF plenary meeting in the US.

FATF plenary meeting in the US.

The appointment of Xiangmin Liu of China as the FATF president from July 1 has raised hopes in Pakistan. “Now is the time for Pakistan to launch an aggressive diplomatic campaign through its Foreign Office to secure support to avoid the grey list,” says Farooq.

Requesting anonymity, a former diplomat, disagrees with Farooq. He says, “The foreign office alone is unable to launch such a campaign because the FATF action plan revolves around the performance of other ministries. Financing of terror and money laundering are areas directly under the supervision of the State Bank of Pakistan, and various law enforcing agencies and the relevant ministries. The Foreign Office can only be useful if the relevant institutions successfully accomplish the tasks and provide the FO accurate information on their progress.”

He regrets that the National Action Plan had not been implemented fully and most of the NAP’s 20 points were yet to be executed. “It’s important to understand that FATF’s action plan is not just about the internal situation in a country but also concerns of the regional and international stakeholders.”

Therefore, he adds, “There is no other way left for Pakistan except to fulfill the commitment in true spirit and within the stipulated time”.

According to Khaled Ahmed, China has asked Pakistan several times in the past to take serious action against those who are involved in terror financing and money laundering. “China has enough evidence on such elements. They have established links with Muslims in Xinjiang province and have been causing security concerns for China.”

Rana is also convinced that despite close relations with China neither Iran nor Pakistan can be certain that Xiangmin Liu will be of any help to Pakistan.

Shehryar Warraich

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The author is a member of the staff and can be reached at [email protected]

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