Proscribed Organizations
August 23, 2017
Madaris Reforms
August 23, 2017

Financial Monitoring Unit (FMU), housed within State Bank of Pakistan is set-up to act as a watch-dog in the domestic, regional and international fight against money laundering and terrorist financing under the Anti-Money Laundering Act, 2010

NACTA has taken a number of initiatives for countering financing of terrorism:

Model Law for NGOs

To substitute multiples laws, governing the functions and registration of NGOs/NPOs & Charities, with one effective law catering to AML/CFT requirements, NACTA has prepared a draft model law for NGOs/NPOs for their effective registration, regulation, audit and enforcement of penal provisions in case of violations with the ultimate aim to protect their misuse for terrorist financing. The draft law will also cater to FATF’s requirements and Pakistan’s obligations there under. The draft has been circulated among all provinces for their feedback. After input of the provinces, it will be submitted to the Government.

Obligatory Cash Declarations:

NACTA has taken the lead role in regulating movement of cash across land and other routes in collaboration with stakeholders like Federal Board of Revenue, State Bank of Pakistan, Anti-Narcotics Force, Federal Investigation Agency & Intelligence Agencies to effectively combat money laundering and terrorist financing.

With the consultation of State Bank of Pakistan (SBP) and Federal Board of Revenue (FBR) Money Declaration Forms have been introduced for both in-bound and out-bound international passengers, in keeping with the international practice where every passenger has to declare the amount of money brought in to or out of the country beyond a certain In this way rules regarding threshold of money are enforced. Customs has been assigned the ask to implement the cash declaration regime with the purpose to enforce SBP’s Rules on currency limits of up to US$ 10,000/visit, the permissible amount of money which can be taken out of country by a passenger.

FIA’s centralized Integrated Border Management System (IBMS) link is being provided to Customs department for effective profiling of passengers and targeted search & seizure of contraband items and illegitimate currency. Work in this regard is under progress and will soon be completed.

FIA (IBMS) has also provided a link to NACTA enabling it to monitor activities of person on Schedule IV of ATA, 1997.

NACTA is also working with the Customs Department for development of an integrated cash declaration data base on all entry/exit points of the country to keep full record of these declarations in respect of every passenger for strict implementation of the SBP Rules regarding the currency limits imposed on inbound and outbound passengers. Monitoring of movement of persons & money through these two steps will go a long way in combating Money Laundering and Financing of Terrorist activities.

Branchless Banking:

The volume of turn over through mobile money transfer/banking is huge and getting bigger with every passing day. Whereas the importance of this system is well understood in the context of financial inclusion, its vulnerabilities and possible underlying risks cannot be ignored. NACTA has put in a lot of effort for stringent controls on Branchless Banking with the aim of making this money-transfer system fully protected against misuse for terrorist financing.

NACTA, after thorough consideration and comprehensive in-house analysis & discussions in the light of views of various stakeholders, has formulated a set of recommendations and has shared the same with SBP for consideration and implementation.

Raising of CFTUs

Countering Financing of Terrorism (CFT) Units in all Counter Terrorism Departments (CTDs) of the provinces have been established for the investigators to always focus on the financial aspect of the investigation as a core and not as an ancillary or in addition to the other tasks during the investigation.

NACTA is consistently encouraging the CTDs and coordinating with them for capacity building of investigators and imparting training to them in the areas of money laundering, terrorist financing, assets tracing and other necessary skills in the realm of financial investigations.

Training modules on CFT are being prepared for making them part of curriculum at all levels of police training to sensitize police officials about the importance of choking funding for terrorists as part of effective counter terrorism strategy.

Task Force on CFT

The Minister for Interior has recently granted approval to the proposal of NACTA regarding raising of a National Task Force on Countering Financing of Terrorism .

The Task Force has representation of all police establishments of Pakistan, ISI, IB, FMU, FBR ANF, NAB, MoF, MoI all Home Departments, FIA, SBP and FATA secretariat. The Task Force has an elaborate mandate with regards to various policy & operational issues, being faced by different departments, enabling it to effectively combat the menace of financing of terrorism and terrorist activities .

The Task Force has started working and its monthly meetings are being regularly held  for appraisal of various AML/CFT related matters in the country.

Implementation of FATF’s recommendations and Preparation for APG’s Mutual Evaluation

NACTA is working in collaboration with all the Police and Counter Terrorism (CTDs) departments of the country for effective implementation of FATF’s recommendations on CFT. Also, the Police set-ups in the provinces have been sensitized and educated about their obligation and role during Pakistan’s Mutual Evaluation by APG ( a regional body of FATF) next year. The CTDs are been engaged continuously for improving the registration of cases of terrorist financing, timely conclusion of investigations and securing convictions from the courts, based on a proactive approach to prevent terrorist incidents by smashing terrorist’s procurement networks through effective financial investigations.

SOP For donation Collection

NACTA has also formulated a detailed SOP/Policy for regulating donation collection (in cash as well as in kind) activities of different NGOs/NPOs and charities in the country. The policy has been shared with all provinces, for implementation through officials of District administration and Police. The purpose is to check illegal fund raising for terrorist financing. Conditions for fund-raising for bona fide purposes are laid down in the SOP.

Alarm-Raising among Provinces on important Occasions

Half of the donations/charities are collected by different organizations during the holy month of Ramadan. Therefore, during this month NACTA has written twice to all the Chief Secretaries and inspectors General of Police of all the provinces to monitor such fund raising activities undertaken by different organizations. Even some of these organizations were identified through sharing of pictures of such activities for the intervention of the provincial governments and enforcement of relevant laws. NACTA repeated the same before Eid-Ul-azha, as hides collection is also a major source of fund raising for different organizations.

Hundi/Hawala

NACTA is continuously engaged with intelligence agencies to monitor and check illegal Hawala operators. Series of meeting have been held, beside regular correspondence & communication, with the stakeholders in this regard. Lists of person involved in illegal forex business have been collected and shared with FIA, for legal action.

As a result, FIA has registered hundreds of cases against such persons involved in illegal transfer of money.

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