Since United Nations through its Securities Council Resolution 1617 requires all UN member State to implement FATF’s AML /CFT Recommendations and Pakistan being member of UN and Asia Pacific Group (APG), a FATF-styled Regional Body is required to adopt FATF Standards as per membership obligations. Henceforth, the reporting entities are obliged to (i) assess the money laundering and financing of terrorism risk that it may reasonably expect to face during its business, i.e., (ii) establishing, implementing and maintaining an AML/CFT programme (procedures, policies and controls) to detect, manage and mitigate the risk of money laundering and the financing of terrorism, (iii) Customer Due Diligence (CDD) (Identification and Verification of Identity) and ongoing CDD, (iv) suspicious transaction reporting, (v) record keeping. Financial Crimes Compliance is a significant ongoing challenge for reporting entities. As regulators (SECP) and Financial Institutions introduce new strategies to detect and prevent financial crime (Money Laundering, Fraud, Cyber Security Crime, Social Engineering, Human and Drug Trafficking, Insider Trading and Computer Fraud Schemes and Embezzlement), criminals develop more sophisticated methodologies to evade legal scrutiny and commit offences-including Fraud, Money Laundering and the financing of terrorism. Reporting entities are expected to participate in the fight against financial crimes, by ensuring compliance with the regulations that authorities put in place -at a risk of potential sever penalties. Financial Crimes Compliance is a significant international concern: global cost of compliance in the financial sector alone is estimated to be around $180-$200billion per annum. To prevent the possible use of NBFCs as a conduit for money laundering or terrorist financing activities, we will help Elphinstone in adopting the following:
