ISLAMABAD: The Securities and Exchange Commission of Pakistan (SECP) has introduced amendments to the Anti-Money Laundering and Countering Financing of Terrorism (AML/CFT) Regulations 2020.

       The notified amendments aim to enhance the scope of regulations to effectively combat financial crimes, control money laundering and combat terror financing while ensuring the integrity of its financial system.

       The amendments are the outcome of the National Risk Assessment 2023, in which SECP conducted a self-assessment of its regulatory framework against the criteria used in the FATF Assessment Methodology for assessing technical compliance of its AML/CFT regulatory framework.

       The amendments, introduced post-stakeholder consultation, demonstrate SECP’s commitment to enhancing the country’s regulatory framework and aligning it with international best practices.

       The amendments primarily focus on expanding the regulatory framework to encompass measures specifically tailored for Customer Due Diligence (CDD) requirements related to bank account opening of mentally disordered persons.

       Under the revised regulations, an account will be classified as dormant after three years of inactivity, as opposed to the previous threshold of five years.

       Furthermore, the updated provisions encompass guidelines regarding the reliance on third parties for CDD, as well as specific requirements applicable to the foreign branches of regulated entities and their subsidiaries.

       Published in Dawn, September 27th, 2023