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The IMF’s warning is clear: Pakistan must improve its anti-money laundering frameworks or face more stringent actions
IMF’s recent diagnostic report has revealed that the country continues to face significant weaknesses in its anti-money laundering systems, despite ongoing efforts and reforms.
The International Monetary Fund (IMF) has raised serious concerns over Pakistan’s inability to effectively tackle money laundering and corruption, signalling the risk of major consequences if swift action is not taken.
CNN-News18 has learnt that the IMF’s recent diagnostic report has revealed that the country continues to face significant weaknesses in its anti-money laundering systems, despite ongoing efforts and reforms.
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One of the key points highlighted by the IMF is the underutilisation of ownership data, particularly the beneficial ownership regime, which was introduced to increase transparency and crack down on corrupt practices. This regime was meant to uncover the ultimate owners of companies, helping to prevent front companies from securing government contracts through illicit means. However, the IMF’s report strongly criticised Pakistan for failing to leverage this data effectively in financial investigations, which has created hurdles in addressing corruption and money laundering schemes.
The IMF’s draft report on the Governance and Corruption Diagnostic Assessment has raised alarm bells over the systemic failures that continue to undermine the impact of reforms. Despite the Financial Action Task Force (FATF) pushing for improvements in anti-money laundering (AML) practices, Pakistan has not been able to fully implement measures to disrupt the coordination of corrupt activities.
The IMF noted that although there is some coordination between the Securities and Exchange Commission of Pakistan (SECP) and investigation agencies, the use of beneficial ownership data remains inconsistent. The IMF emphasised that real-time exchanges of this data between agencies like the State Bank of Pakistan (SBP), Federal Board of Revenue (FBR), and other institutions is essential for rooting out corruption.
In its assessment, the fund recommended that Pakistan establish a multi-agency working group to ensure that beneficial ownership information is regularly reviewed in support of anti-corruption investigations. However, the IMF pointed out weaknesses in registry implementation, verification processes, and enforcement as major roadblocks to the success of this framework.
The warning from the IMF comes at a time when Pakistan is already under pressure from the FATF. While Pakistan has made some progress on FATF reforms, the continued inefficiency in addressing corruption and money laundering casts a shadow over the country’s efforts to meet international financial standards. The IMF delegation, which is scheduled to visit Pakistan in September 2025, is expected to scrutinise the government’s progress in implementing the required reforms and addressing these pressing concerns.
The IMF’s warning is clear: Pakistan must improve its anti-money laundering frameworks or face more stringent actions. The financial institution is urging Pakistan to institutionalise reforms that allow for greater transparency, data sharing, and effective enforcement to tackle corruption at the highest levels. The delegation’s visit, followed closely by the FATF’s evaluation, will likely be a critical moment in determining Pakistan’s future standing on the global financial stage.
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Group Editor, Investigations & Security Affairs, Network18
Group Editor, Investigations & Security Affairs, Network18
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