In a massive setback to Pakistan, the Asia-Pacific Group of the Financial Action Task Force (FATF) has downgraded Pakistan and placed it under the list of blacklisted countries.
The Asia-Pacific Group, one of the nine regional affiliates of FATF, has placed Pakistan in the enhanced expedited follow-up list for its failure to meet its standards.
Pakistan was adjudged as non-complaint in 32 of the 40 compliance parameters. Despite collective efforts, Pakistan could not satisfy the 41-member plenary to upgrade it from grey-list and instead placed the nations under black-list.
Pakistan now faces the challenge of avoiding being placed under FATF’s overall black list in October. It was earlier placed in the ‘grey list’ by FATF.
The FATF plenary had formally placed Pakistan in the grey list in June 2018 after the country could not secure a minimum of three votes. On May 3, Finance Minister Arun Jaitley said India will ask the FATF to put Pakistan on a blacklist of countries that fail to meet international standards in stopping financial crime.
Earlier, the FATF said that Pakistan failed to complete its action plan on terror financing. It warned Islamabad to meet its commitment by October or face action, which could possibly lead to the country getting blacklisted.
The decision to blacklist Pakistan was taken by the APG during its meeting in Canberra, Australia. This was based on a five-year mutual evaluation of Pakistan’s progress on upgrading its systems in areas of financial and insurance services and sectors.
On Wednesday, Pakistan had submitted the compliance report on its 27-point action plan to the FATF. Pakistan’s contentions on improving its grading in different parameters also did not get any support at APG’s meeting.