On Thursday, The State Bank of Pakistan (SBP) and the Securities and Exchange Commission of Pakistan (SECP) signed a Letter of Understanding (LoU) to tighten their joint supervisory role against money laundering and terror financing.
The SBP and SECP have amended the Terms of Reference (ToR) of their Joint Task Force (JTF) on financial conglomerates to further strengthen the supervisory cooperation, inter alia, in Anti-Money Laundering, Combating the Financing of Terrorism and Countering Proliferation Financing (AML/CFT/CPF) supervision at a financial-group level.
The initiative has been taken after the country failed to come out from the grey list of the Paris-based Financial Action Task Force (FATF) which has tightened its grip over Pakistan. Financial circles in Pakistan believe the watchdog discriminates against Pakistan while comparing the financial systems of other regional countries including India and Bangladesh.
Pakistan has another chance to come out from the grey list in June 2021 which is why the two regulators – SBP and SECP – decided to strengthen their role against AML and CFT.