The Financial Action Task Force (FATF) has reiterated that Pakistan’s removal from its grey list in October 2022 does not shield the country from ongoing scrutiny regarding terror financing and money laundering. FATF President Elisa de Anda Madrazo, speaking in France after the plenary session, stressed that delisted countries must maintain robust measures to combat illicit financial flows. She highlighted that former greylisted countries remain vulnerable to exploitation by criminals and terrorists, urging continued vigilance and compliance.
Madrazo emphasized that “delisting is not the end of the process,” urging Pakistan to strengthen financial systems and close loopholes exploited by criminals. This warning comes amid reports that terror groups operating from Pakistan, including Jaish-e-Mohammad (JeM), are increasingly using digital wallets and masked financial channels to fund operations and training camps. The FATF’s “Comprehensive Update on Terrorist Financing Risks” flagged these emerging digital financing threats as a significant risk.
India’s 2022 National Risk Assessment has also identified Pakistan as a high-risk source of terror financing, linking some operations to state-affiliated entities such as the National Development Complex (NDC). Inputs from India were reflected in the FATF’s report, which underscored ongoing regional threats from state-sponsored terrorism and proliferation financing. Madrazo reiterated FATF’s commitment to global standards aimed at depriving criminals and terrorists of the funds they rely on.
The Paris plenary concluded with the adoption of mutual evaluation reports under FATF’s updated, results-based assessment framework, which prioritizes measurable outcomes over procedural compliance. In addition, Burkina Faso, Mozambique, Nigeria, and South Africa were removed from the grey list after completing their respective action plans. Pakistan, meanwhile, continues to undergo follow-up evaluation by the Asia Pacific Group (APG) to ensure sustained enforcement of anti-terror financing measures.
