Recently, the Financial Action Task Force (FATF) reviewed Pakistan’s performance in curbing money laundering and other terror financing activities. Under a unanimous decision by the committee, the FATF decided to keep Pakistan on its grey list but ruled out the possibility of black listing Pakistan as a majority of the conditions under the original plan have been met.
The FATF justified its decision on the findings that Islamabad did not meet the more strategic and significant condition that includes the nomination of entities and individuals who need to be placed on the United Nations’ list of terrorist organizations. In addition, Pakistan has to complete two more points on the action plan to get off the grey list. According to FATF President Marcus Pleyer, Pakistan has largely addressed 30 items on the FATF recommendation plan, however, it still needs to address the remaining two crucial action points.
Previously, Pakistan took several steps towards improving its efforts in the area of anti-money laundering and financing of terrorist organizations. The government enacted several legislative amendments including the registration of property dealers with Designated Non-financial Businesses and Professions (DNFBPs).
The property and the larger real estate sector is perceived as a harbour of terror financing and money laundering activities. However, the sector holds immense potential to accelerate economic growth in the country. The government should introduce measures that can regulate the sector to ensure transparency and increase investor confidence.