Pakistan eyes more remittances through FATF compliance, curbing hawala 

KARACHI: Pakistan is optimistic that its amendments to anti-money laundering laws will not only contain the illegal practice, but also move to official channels remittance inflows that have been made through hundi and hawala operators.
The amendments to anti-money laundering regulation are in accordance with Financial Action Task Force (FATF) recommendations.
“Under FATF action plan, the FIA (Federal Investigation Agency) is effectively taking action against hawala and hundi operators,” said Mansoor Hassan Siddiqui, director general of the Financial Monitoring Unit (FMU).
“Many people are under investigation and in many cases administrative and monetary punishments have been awarded,” he told Arab News on Monday. 
The South Asian country has amended its anti-money laundering and foreign exchange laws to ensure strict law enforcement. The Foreign Exchange Regulation Act (FERA) was passed in 1947, while the Anti-Money Laundering Act (AMLA) in 2010. Under their amended versions, offenders will face 10 years in prison and Rs5 million in fines. 
The FATF gave Pakistan 27 action items. The country is largely compliant in five and non-compliant in another five. It is partially complaint in 17.
Sidiqqui said that Pakistan had submitted its second round of progress report to the FATF on Jan. 8, 2020. The report will be discussed by the task force’s member countries in Beijing on Jan. 21-22.
“One of the FATF action items is to take action against illegal operators,” he said, adding that in national risk assessments hawala and hundi are identified as “high risk” modes of financing terrorism and money laundering in Pakistan.
FATF has given Pakistan time until February 2020 to implement the action plan or face blacklisting. The country is currently on the FATF’s gray list. According to Siddiqui, Pakistani authorities are optimistic that they had made significant progress in compliance.
Stakeholders say that around 30,000 illegal money changers and hundi or hawala operators are active in the country, discouraging money transfers through more expensive official channels.
“The government’s actions have restricted the movement of currency in the country, as now if someone is carrying $10,000, he will have to seek SBP (State Bank of Pakistan) permission. But still, around 30,000 illegal operators are active,” Malik Bostan, president of the Forex Association of Pakistan, told Arab News.
Reza Baqir, the central bank governor, on Friday also observed that the use of formal channels by overseas Pakistanis for sending money is not growing as much as the use of informal channels. “The reasons for this may be the comparatively higher cost of sending money and the questions asked from the senders,” the SBP governor said while speaking at the Pakistan Banking Awards ceremony in Karachi.
In 2019, a total of 625,203 Pakistanis moved out of the country to find jobs, over half of them in Saudi Arabia. This number was followed closely by the UAE and other Gulf countries. In stark contrast, the number of Pakistanis who found jobs abroad in 2018 was 382,439, according to Bureau of Emigration and Overseas Employment data. 
According to the Ministry of Finance, growth in foreign remittance, which soared to $11.4 billion in July-December, is likely to continue for the rest of the fiscal year. The government’s foreign remittance target for FY2020 is $24 billion, and “it is likely to be achieved,” the ministry said in a statement on Monday.