Welcome to MINISTRY OF LAW AND JUSTICE ANTI-MONEY LAUNDERING AND COUNTER FINANCING OF TERRORISM (AML/CFT) FOR DNFBPS
The Anti – Money Laundering and Countering Financing of Terrorism (AML/CFT) regime seeks to help instill public confidence in the country’s financial systems domestically and globally. The AML/CFT regime in Pakistan is applicable for banks, other financial institutions, financial service providers and the Designated Non – Financial Business and Professions (DNFBPs).
Anti-Money Laundering (AML) and Terrorism Financing – Why do theymatter?
The Financial Action Task Force (FATF) is an inter-governmental body and the international standard setter for anti-money laundering (AML) and countering the financing of terrorism (CFT) and the financing of proliferation of weapons of mass destruction. .
Pakistan’s Designated Non-Financial Businesses andProfessions (DNFBPs)
The global response to the threat of money laundering and terrorist financing is led by the Financial Action Task Force (or FATF). Pakistan is a member of one of the FATF-style regional bodies, the Asia Pacific Group and, as such, has signed up to implement the International Standards on Combating Money Laundering, the Financing of Terrorism and Proliferation Financing.
Understanding Money Laundering and Terrorist Financing Risk in DNFBPs
Money laundering and Terrorist Financing RISK refers to the interaction between threats and vulnerabilities, that make the system vulnerable to abuse by criminals. THREATS refer to people or groups of people, objects or activities with the potential to cause harmvia Money laundering and Terrorist Financing
DNFBP’s Obligations: Preventive Measures and Internal Controls
In order to prevent DNFBPs, including lawyers, from being abused by criminals such as money launderers and terrorist financiers, these businesses must put in place AML/CFT compliance programs. A compliance program is a set of internal policies and procedures developed by an institution in order to comply with AML/CFT laws, rules, and regulations as well as to uphold the institution’s reputation.
What to Expect Under Pakistan’s New AML/CFT Supervisory Regime
Each DNFBP sector has a dedicated AML/CFT regulatory authority to monitor and encourage compliance with AML/CFT obligations. The dealers in precious metals and stone sector as well as the real estate brokers and dealers, builders and developers are supervised by the Federal Board of Revenue.
Which category of lawyers fall within the DNFBPs Regime and what are the AML/CFT Risks Associated with certain activities where lawyers are engaged
Lawyers are key actors in the business and financial world, facilitating vital transactions that underpin the economy in Pakistan and globally. The Financial Action Task Force characterizes lawyers as “Gatekeepers” because they “protect the gates to the financial system,” through which potential users must pass in order to access it.
Customer Due Diligence
• Generally speaking, Customer Due Diligence or Know Your Customer is the act of performing background checks on the customer to ensure that they are properly risk assessed before being onboarded as a client. In this process relevant information about a customer is collected and evaluated for any potential risk to the organization, whereby it might be used for money laundering/terrorist financing activities.