Analysis of the Anti-Money Laundering Bill Pakistan

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It is agreed that Pakistan needs to enact an anti-money laundering legislation to comply with its international obligations and commitments. However, there is a growing consensus that the Anti-money laundering bill now pending before Parliament to change to accurately incorporate these obligations.

In the wake of 9/11 based efforts against terrorism, and universal desire to eliminate funding opportunities for sponsoring terrorism, it has become imperative for countries to be able to keep track of suspicious money transfers. This requires the assistance of financial institutions and most banks have already developed compliance departments certain Anti Money Laundering (AML) contacts within such departments. However, Pakistan needs to enact proper legislation to ensure such compliance, and the right to investigate, criminalization and prosecution of money laundering offenses

Opening of anti-money laundering law has been Will most top meetings level and Pakistan has been under pressure quick passage of the said law from Western governments, loan granting agencies and other international forums, such as the Financial Action Task Force (FATF) and the Asia Pacific Group (APG).

Furthermore, the resolution of United Nation Security Council 1617, passed under Chapter VII of the UN Charter and therefore binding on all Member States, “Very urges Member States to implement the comprehensive international standards embodied in the FATF Forty recommendations on money laundering and the FATF Nine Special Recommendations on terrorist financing “.

The Financial Action Task Force, the inter-governmental body whose purpose is the development and promotion of national and international policies to combat money laundering and terrorist financing, developed Forty plus Nine Recommendations, which now form the benchmark for anti-money laundering initiatives and actions.

The AML bill is now pending before Parliament for approval and National Assembly Standing Committee on Finance and Revenue (the “Committee”) has already been briefed by Omar Ayub Khan on the said bill earlier this month, and the Committee has also made certain comments on the provisions so far discussed.

committee is likely to discuss the rest of the bill next week and where the provisions of the bill are presently under discussion and the text of the bill has been opened up by the Committee itself to discussion, Research Society of International Law (RSIL) thought it appropriate to conduct a workshop for stakeholders to highlight and discuss their concerns regarding the text of the bill. The said seminar was attended by representatives from 20 organizations, the state and the financial and creative discussion on the subject was initiated.

It is pertinent to mention that the said Committee has not yet been given any legal summary of the bill as such. However RSIL is likely to be invited by the Committee on the finalization of the bill.

eminent lawyer and international expert, Mr. Ahmet Bilal sooft is of the opinion that the bill currently under discussion in Congress travels far beyond minimum compliance. According to him, the bill needs to be changed, otherwise, it will create serious business obstacles that still make the minimum compliance difficult. Resultantly, the end of the day, despite having made a law, the international community will see Pakistan not seriously comply with anti-money laundering measures and commitments. Mr sooft represented Pakistan at the UN General Assembly negotiations on the UN Convention against Corruption (UNCOC), containing provisions on money laundering and also participated in the FATF / APG evaluation in accordance Pakistan.

Pakistan is not only obliged to adopt such a strategy under the UNSC Resolution 1617, but there are other obligations under the UN Convention on Narcotic Drugs, the obligation to provide mutual legal assistance requested by states, international state practice in this regard Under the United Nations and annual reporting anti-money laundering measures by Pakistan under US law. From another perspective, Pakistan, by virtue of being a developing country should try to adopt anti-money laundering and terrorist financing policies to help protect and build its economy.

In this regard RSIL believes there is no need to dwell on the courts of anti-money laundering, as proposed in the bill. The charge of money laundering should be regarded either in the courts that try such offenses or ordinary courts as a stand-alone charge. Other countries have not encouraged up specialized anti-money laundering courts. Moreover, not the FATF recommendations do not need it, then why should Pakistan set up a parallel judicial system for criminal offenses that are intrinsically linked to the existing offenses are tried in the current court?

Further, according to international standards, money laundering should be prosecutable as a stand-alone crime without convicting the offender for the original offense. The proposed law does not comply with this obligation.

RSIL but that the definition of money laundering in the proposed bill is also flawed. The correct definition is contained in the Vienna Convention or the Palermo Convention. The said definitions adopted by the FATF. They scale the role of the main offender and accomplice with penal consequences, but the definition in this bill is overly broad.

RSIL but also that the bill will specifically exclude such remittances that are made for getting income tax fiscal offenses are not on the list of predicate offenses. It is necessary to clarify the provisions of the law if any money cleaning before it enters into force.

Current bill creates a complex and confusing control, both for rendering aid and assistance in money laundering investigations and prosecutions. We are of the opinion that the provisions in question to switch to provisions similar to the one on mutual legal assistance found in Article 46 of the United Nations Convention against Corruption and Article 18 of the UN Convention against Transnational Organized Crime; which together are believed to be accurate legislation Combinations MLA regime.

RSIL team is of the opinion that the Financial Monitoring Unit (FMU), who lived under the proposed bill, which will be allowed to receive reports on suspicious financial transactions from banks, has been unnecessary wide powers defendant, production records and conduct research . Hardly any other country has done so. FATF recommendations also require this. The investigative powers of FMU should be withdrawn and the bill is in harmony with it, otherwise, this will have serious consequences for banks and other financial institutions in the country in terms of compliance and disclosure. Investigations should only be the domain of the prosecution agency that has a functional relationship to the predicate offense.

In addition, most of the provisions of the current bill have been copied from the flawed Indian Act called “The prevention of money laundering Act ‘adopted in 2002. Although, there is no harm in copying the good provisions of Indian legislation the same subject, this particular Indian law has not generally been granted approval internationally and has really faced criticism at international forums such as the Asia Pacific Group (APG), especially at the 2005 APG conference in Australia

There is based RSIL is anti -. money laundering law will be approved quickly because of Pakistan, under international law, is obliged to do so. In this context some proposals Financial Action Task Force (fold more potent) are to be implemented within Pakistan through the compliance departments of financial institutions and other regulations. In short, RSIL position is that the bill will correct and suitably adjusted so as to ensure the smooth implementation of anti-money laundering measures in Pakistan.

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