Relevance:
Pakistan is off the ‘grey list’ of the Financial Action Task Force (FATF).
News Summary:
- FATF’s decision on Pakistan came 4 years after it was placed on the increased monitoring (referred to as the Grey List) to curb terror financing and money laundering.
- FATF also removed Nicaragua from increased monitoring jurisdiction.
- Benefits of the FATF de-listing:
- Receive a reputational boost and get a clean bill of health from the international community on terrorist financing.
- Increase in overseas investment in the country.
About FATF:
- Establishment – As an inter-governmental body in 1989
- Secretariat: OECD Headquarters (Paris)
- Aim – To protect the global financial system against money laundering, terrorist financing and financing of proliferation of weapons of mass destruction.
- Composition: 37 member jurisdictions (including India) and 2 regional organisations (Gulf Cooperation Council and European Commission)
- FATF’s International Standards –
- Global anti-money laundering (AML) standards
- Counter-terrorist financing (CFT) standards
About FATF lists:
- Black List:
- Official Name – High-Risk Jurisdictions
- Non-Cooperative Countries or Territories (NCCTs)are put on the blacklist.
- Examples – Iran, Myanmar and North Korea.
- Grey List:
- Official Name – Jurisdictions Under Increased Monitoring
- A safe haven for supporting terror funding and money laundering are put on the FATF grey list.
- Examples – Philippines, Syria, Yemen, the United Arab Emirates
Reference: The Hindu
