FATF Seeks Further Clarifications From Pakistan on Action Against Banned Madrasas, Raises Pressure Ahead of Key Review

FATF Seeks Further Clarifications From Pakistan on Action Against Banned Madrasas, Raises Pressure Ahead of Key Review

The Financial Action Task Force (FATF) has asked Pakistan to provide further data and clarifications on steps taken against madrasas linked to banned extremist groups.

Islamabad/Paris: The Financial Action Task Force (FATF), the global watchdog responsible for monitoring money laundering and terror financing, has asked Pakistan to provide extensive additional clarifications, data, and statistics regarding its actions against madrasas and institutions linked to banned extremist organizations. The development adds fresh pressure on Islamabad as it works to avoid being placed on the FATF “blacklist” for failing to meet international counterterrorism financing standards.

According to Pakistani officials, the Paris-based body has sent a detailed questionnaire seeking answers to nearly 150 follow-up questions, just weeks after Pakistan submitted its latest compliance report outlining measures taken to manage terror financing risks and curb money laundering activities. FATF has kept Pakistan on its “gray list” and has warned that failure to meet the remaining action points could result in tougher punitive measures.

Pakistan’s Status on the FATF Gray List

Pakistan has remained on the FATF gray list since June 2018, a designation that places the country under increased monitoring due to strategic deficiencies in its framework for combating money laundering and terror financing. While being on the gray list does not trigger automatic sanctions, it complicates access to international financial markets, increases scrutiny from lenders, and can discourage foreign investment.

In October, FATF warned Pakistan that it must fully comply with 27 action points, including enhanced monitoring of terror-linked organizations, prosecution of designated individuals, and decisive action against institutions used for fundraising or recruitment. According to FATF assessments, Pakistan has so far complied with only five of these points, leaving 22 still under evaluation.

Failure to demonstrate meaningful progress could result in Pakistan being moved to the FATF “blacklist,” a category reserved for jurisdictions considered high-risk and non-cooperative. Such a move could have severe economic and diplomatic consequences.

FATF Seeks More Data and Fresh Evidence

Pakistani officials confirmed that after reviewing Islamabad’s latest submission, FATF’s joint assessment group requested additional information, citing the need for more clarity, updated statistics, and proof of enforcement actions.

“The FATF has responded to our compliance report through email, raising around 150 questions,” a senior official told The News. “Some questions seek additional data, some ask for clarification, while others specifically request details on actions taken against madrasas and institutions affiliated with banned organizations.”

The official added that FATF is particularly interested in verifiable outcomes, not just policy announcements or administrative orders. This includes evidence of asset seizures, criminal prosecutions, regulatory oversight, and long-term monitoring of religious and charitable institutions suspected of links to extremist groups.

Focus on Madrasas Linked to Banned Groups

A key area of FATF’s concern involves madrasas and educational institutions allegedly connected to organizations designated by the United Nations and other international bodies. Officials say the FATF has asked Pakistan to provide updated figures on how many such institutions have been taken over, regulated, shut down, or restructured under state supervision.

According to Pakistani authorities, one of the largest networks under scrutiny belongs to Jamaat-ud-Dawa (JuD), an organization led by Hafiz Saeed, who has been designated a global terrorist by the United Nations and is accused of orchestrating the 2008 Mumbai terror attacks. JuD is widely regarded as a front organization for Lashkar-e-Taiba (LeT), a banned militant group.

Government officials estimate that the JuD network operates around 300 madrasas and schools across Pakistan, along with a range of welfare and charitable institutions.

Government Claims on Takeover of Institutions

In March, Pakistan’s Punjab Police announced that the provincial government had taken control of a significant number of JuD- and FIF-linked facilities. According to official figures, authorities assumed control of:

·         160 madrasas

·         32 schools

·         2 colleges

·         4 hospitals

·         178 ambulances

·         153 dispensaries

These facilities were previously operated by JuD and its charitable wing, Falah-e-Insaniyat Foundation (FIF), which has also been banned.

In addition, officials said that in southern Sindh province, at least 56 madrasas and related institutions run by JuD and FIF were taken over by the state. The government has claimed that these measures demonstrate its commitment to dismantling the infrastructure used by extremist groups to raise funds, recruit members, and gain public legitimacy.

However, FATF appears to be seeking independent verification, long-term compliance mechanisms, and proof that these takeovers have resulted in permanent disengagement from banned groups.

Deadline Looms for Pakistan’s Response

Officials confirmed that Pakistan has been given a deadline of January 8, 2020, to submit responses to the 150 questions raised by FATF. The timing is critical, as the next plenary meeting of the FATF is scheduled to take place from January 21 to January 24 in Beijing.

During this meeting, Pakistan will be given an opportunity to present its case, defend its compliance efforts, and persuade member states that it is making sufficient progress toward meeting FATF requirements.

At the same time, Islamabad is reportedly seeking an extension, requesting that the final evaluation be postponed until June 2020, when a comprehensive FATF review meeting is planned. Pakistani officials argue that additional time would allow the country to fully implement structural reforms and demonstrate sustained results.

International Scrutiny and Diplomatic Stakes

Pakistan’s FATF status has become a key diplomatic issue, particularly as the country seeks economic stabilization and international financial assistance. The gray-list designation has already complicated dealings with global financial institutions and multilateral lenders.

Analysts say FATF’s emphasis on measurable outcomes reflects growing impatience among member states, particularly over Pakistan’s handling of long-standing concerns related to banned groups.

“FATF is no longer satisfied with announcements or symbolic actions,” said a regional security analyst. “They want convictions, asset forfeitures, and irreversible dismantling of terror-linked networks.”

Balancing Domestic Sensitivities and Global Pressure

Within Pakistan, action against religious institutions remains a sensitive issue. Madrasas play a significant role in the country’s social and educational landscape, and authorities must balance counterterrorism obligations with concerns about public backlash and political resistance.

Government officials have maintained that their actions are aimed only at institutions linked to banned groups and that mainstream religious education is not being targeted. However, FATF’s demands suggest that international observers remain unconvinced that enforcement is comprehensive or consistent.

What Lies Ahead

As Pakistan prepares its response to FATF’s 150 questions, the coming weeks are likely to be decisive. A failure to convince FATF members of genuine progress could result in Pakistan facing increased financial isolation at a time when its economy remains under strain.

Conversely, a positive assessment could lead to continued gray-list status with additional time for reforms, or eventually pave the way for removal from enhanced monitoring.

Conclusion

FATF’s request for further clarifications and data underscores the challenges Pakistan faces in convincing the international community of its commitment to combating terror financing. While Islamabad has highlighted steps taken against banned organizations and their affiliated madrasas, FATF’s detailed follow-up questions signal that scrutiny remains intense.

With a critical review meeting approaching, Pakistan now faces a narrow window to demonstrate not just intent, but concrete and sustained action. The outcome of the upcoming FATF deliberations could have lasting implications for Pakistan’s economy, diplomacy, and global standing.

 

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