Islamabad: Pakistan’s Finance Minister Mohammad Aurangzeb has raised serious concerns that the country may once again be placed under the Financial Action Task Force (FATF) gray list due to increasing unregulated financial transactions and suspected links to terrorist funding.
Aurangzeb, addressing officials in Shahbaz Sharif’s government, admitted that nearly 15% of Pakistan’s population is engaged in financial activities without any regulatory oversight. This lack of monitoring, he cautioned, could lead to renewed global scrutiny of Pakistan’s financial system.
FATF Monitoring Terrorist Financing
While the Finance Minister attempted to link the FATF threat with Pakistan’s struggling economy, experts point out that the core issue remains money laundering and terror financing. Reports suggest that funds are still being channeled to banned organizations such as Jaish-e-Mohammed and Lashkar-e-Taiba, groups long accused of orchestrating violence in South Asia.
FATF has been closely monitoring these activities, with particular focus on how hawala networks, cash transfers, and digital payment platforms are being misused to fund extremist groups.
Digital Finance Adds to the Challenge
Aurangzeb warned that if Pakistan fails to regulate emerging digital financial platforms, fintech apps, crypto wallets, and hidden transactions, it may face strict international penalties. “Without immediate reforms, FATF will not hesitate to act,” he said, urging the government to tighten regulatory systems.
Pakistan’s Past With FATF
Pakistan has a troubled history with FATF oversight. In 2018, it was placed on the gray list over terror financing allegations. For four years, Islamabad worked under heavy monitoring and complied with several global standards before being removed from the gray list in 2022.
However, the latest warnings suggest Pakistan risks slipping back into the same situation, which could severely damage its financial credibility and foreign investment prospects.
Expert Opinion
Analysts believe that Pakistan’s economic recovery will face a serious setback if FATF gray-listing returns. “Pakistan cannot afford to be isolated financially again. It must immediately shut down loopholes in digital and informal money transfers,” said a financial security expert quoted by The Pakistan Tribune.
The Road Ahead
With FATF monitoring intensifying, Islamabad’s challenge lies in balancing its economic struggles while addressing global concerns over terror financing. Aurangzeb’s remarks highlight that without urgent reforms, Pakistan’s international financial standing could once again be at risk.
also read – Pakistan’s Foreign Minister Ishaq Dar in Dhaka: Will Pakistan Apologize for 1971? India Watches Closely