Pakistan to continue to be on FATF’s ‘Gret List

Context

Pakistan will continue to be on the "Grey List" of countries under increased monitoring of the Financial Action Task Force (FATF).

Pakistan was placed in the grey list, or list of countries under increased monitoring, in June 2018.

FATF was established in July 1989 by the G7 Summit at the Arche de la Defense in France as part of the group’s efforts to curb drug trafficking.
The FATF is headquartered in Paris and has two official languages: English and French.
It also has a French name: Groupe d’action financière (GAFI).

It periodically lists out countries and jurisdictions that are identified as having strategic deficiencies in their regimes to counter money laundering.
The list is referred to as the FATF grey list.
The FATF is involved in reviewing money laundering and terrorist financing techniques and constantly strengthens its standards to address new and emerging risks.

What is the FATF Grey List?

The FATF GREY list is prepared by the Financial Action Task Force (FATF), an intergovernmental body formed to combat money laundering.
The FATF grey list is the agency’s official list of countries and jurisdictions that are identified as having strategic deficiencies in their regimes to counter money laundering, terrorist financing, and proliferation financing.
Unlike the blacklisted ones, the grey list countries actively work with the FATF to address strategic deficiencies in their regimes.
These countries are mandated to periodically report on the progress made in addressing the identified strategic deficiencies, while the FATF closely monitors the progress of their agreed action plans expeditiously and within the proposed timeframes.

It creates a negative impact on the economy of the listed country.
Their transactions on the international level are closely monitored and thoroughly scrutinised.
Some countries may also stop economic relations with a grey-listed country.

The FATF blacklist is the agency’s official list of “Non-Cooperative Countries or Territories” (NCCTs) which it judges to be non-cooperative in the global fight against money laundering and terrorist financing.