Senate approves anti-money laundering (AML) and foreign exchange regulation bills

Senate approves anti-money laundering (AML) and foreign exchange regulation bills

Posted on Feb 12, 2020

Islamabad: Senate approves anti-money laundering (AML) and foreign exchange regulation bills after amendment.

It should be noted that both these bills have already been approved by the National Assembly.

Both of these bills are intended to meet the requirements of the Financial Action Task Force (FATF), and they will now be sent back to the National Assembly to highlight the proposed amendments to the House.

Since June 2018, the FATF has placed Pakistan on the grey list, a category for countries whose mechanism is unable to prevent money laundering and terrorist financing.

The FATF meeting will be revised with reference to Pakistan on February 16, while it is likely that Pakistan will have to settle on the grey list for the next few months.

An anti-money laundering bill approved by the National Assembly authorized investigating officers to arrest money laundering suspects without a warrant, but the Senate rejected the offer.

Another amendment proposed the removal of a proposal to declare money laundering as a cognizable offence.

The Senate approved an increase in fines and also approved changes to the prison term.

After the enactment of this bill, those who commit money laundering will be sentenced to one to 10 years imprisonment while the fine will also increase from Rs 1 lakh to Rs 50 lakh.

Under another amendment, the State Bank of Pakistan's Financial Management Unit (FMU) should immediately provide information about money laundering to foreign entities within the scope, rather than waiting for 'necessary administrative action'. Banks will be obliged to report suspicious transactions within 7 days.

The amendment bill also seeks to empower investigating officers to link property involved in money laundering for six months, compared to the current 3-month period.

Banks will be obliged to file reports of suspicious transactions and failure to do so will result in imprisonment of 5 years and fine of Rs 5 lakh.

The Senate approved most of the amendments proposed by the government in the Foreign Exchange Regulations Act, 1947, except to propose to limit the foreign exchange movement to $ 10,000 only.


Mian Tajamul

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