‘Not bulletproof’: FATF warns Pakistan not to drop its guard on terror financing despite greylist exit

Global watchdog says removal from greylist doesn’t make Pakistan “bulletproof” against money laundering and terror funding.

The Financial Action Task Force (FATF) has warned Pakistan that its removal from the global watchdog’s greylist in October 2022 doesn’t make it immune to money laundering or terror financing concerns.

FATF President Elisa de Anda Madrazo said that every country, including those recently delisted, must continue to tighten safeguards against illicit financial activities.

“Any country that is on the greylist or has exited it is not bulletproof against criminal actions, whether by money launderers or terrorists,” Madrazo said during a press conference in Paris. “We invite all jurisdictions, including those who have been delisted, to continue their good work to prevent and deter crimes.”

Pakistan remains under follow-up monitoring

While Pakistan was removed from the FATF greylist in 2022 after meeting key compliance benchmarks, it continues to face follow-up reviews by the Asia Pacific Group (APG), a regional body that monitors the implementation of anti–money laundering (AML) and counter–terror financing (CTF) frameworks.

Pakistan is not a member of FATF, but the APG ensures Islamabad continues aligning with FATF’s global standards.

The greylist, formally called the list of jurisdictions under increased monitoring, includes countries with “strategic deficiencies” in curbing financial crimes and terror funding.

Fresh worries after digital terror funding reports

Madrazo’s warning comes amid reports that Pakistan-based terror groups such as Jaish-e-Mohammad (JeM) have turned to digital wallets and crypto channels to finance operations while concealing money trails.

India’s National Risk Assessment 2022 has already identified Pakistan as a high-risk source of terror financing, underlining persistent threats despite formal FATF compliance.

A recent FATF report titled “Comprehensive Update on Terrorist Financing Risks” noted rising instances of state-sponsored terrorism and flagged Pakistan’s National Development Complex as a proliferation risk in South Asia.

FATF’s broader crackdown on illicit finance

The FATF’s fourth plenary meeting, held in Paris under Madrazo’s presidency, reiterated its goal of cutting off funding channels for global criminal networks. Delegates from more than 200 jurisdictions participated in the three-day session.

The plenary also approved the first two mutual assessments under FATF’s new time-bound and risk-based framework, focusing on results achieved by countries like Belgium and Malaysia in tackling money laundering and terror financing.

In addition, Burkina Faso, Mozambique, Nigeria, and South Africa were removed from the greylist after completing their respective Action Plans.

‘Remain vigilant’ message to all countries

Reaffirming FATF’s global mission, Madrazo said the body would continue strengthening its evaluation processes to ensure effective prevention of terror financing.

“FATF remains committed to strengthening standards and ensuring implementation so we can protect people by reducing terrorist financing worldwide,” she said.

(With inputs from ANI)