Its about the topic with some brief knowledge about cases of Pakistan with political icons involved.

1. Anti-Money laundering

2.  DEFINITION OF
MONEY LAUNDERING

3. PROCESS OF MONEY LAUNDERING

4. Process of Money Laundering
Placement Layering Integration

5. How much money is laundered every year?
 Since money laundering is an illegal activity therefore one can only
estimate the amount of money laundered every year.
 The United Nations Office for drugs and crime, for example, had stated
in 2012 that the aggregate size of money laundering in the world could be
somewhere between 2-5% of the world’s gross domestic product
(UNODC)
 This is $800 billion - $2 trillion in current US dollars.

6. Regulatory Authorities
 United Nations
 FATF (Financial Action Task Force)
 IMF
 World Bank

7. Pakistan’s Position Regarding Anti-Money
Laundering Laws
Acts and Ordinances Passed of AML Laws Uptil 2014
 The Control of Narcotic Substances Act of 1997
 National Accountability Ordinance of 1999
 Anti-Terrorism Act of 2002
 In 2010, the State Bank of Pakistan (SBP) passed the Anti-Money Laundering Act. The
Act thereby replaces the 2007 AML Ordinance.
 Oct 12 2013 Ordinance was passed (further amendments)
 The Financial Action Task Force (FATF) has given timeframe till June 2014 to Pakistan
to amend further the money laundering laws as well as Anti-Terrorism Act to
incorporate the content of the ordinance before the February 2014 meetings.
 Pressure by FATF to Convert Ordinance in to Permanent legislation through the
parliamentary process.

8. The Sharif brothers (Hudaibiya Paper
Mill)
 Nawaz sharif and Shahbaz sharif were accused of laundering
money worth $35 million. This case was initiated after the military
coup in 1999.
 This revelation was given by the Sharif brothers’ close associate
Ishaq dar.
 Ishaq dar gave a 43 page confessional statement before the
District Magistrate Lahore on 25th April 2000.Dar was produced
before the court by FIA.
 Dar, in his statement had admitted that he had been handling the
money matters of the Sharif family and he also alleged that Mian
Nawaz Sharif and Mian Shahbaz Sharif were involved in money
laundering worth at least $14.886 million.
 Interestingly, Ishaq Dar also implicated himself by confessing in
the court that he along with his friends Kamal Qureshi and
Naeem Mehmood had opened fake foreign currency accounts in
different international banks.

9. Continued…..
 He said that the entire amount in these banks finally landed in
the accounts of Hudaibiya Paper Mills Limited.
 Senator Ishaq Dar was the main witness against Nawaz and
Shahbaz Sharif in the case.( Waada ma’af gawah)
 The statement by Senator Ishaq Dar is irrevocable as it was
recorded under section 164 of the Criminal Procedure Code
(CrPC).
 The Hudaibiya Paper Mills case is still
pending in the National Accountability
Bureau.

10. Asif Ali Zardari (Mr 10%)

11. Asif Ali Zardari
 In 2003, a Swiss investigative magistrate decided he had
evidence of Zardari and Bhutto after pursuing a money trail from
offshore companies in the Caribbean to banks in Geneva to a
jewelry shop here.
 In his 2003 verdict, the Swiss judge connected Zardari to a chain
of corruption that began with two Swiss companies, Cotecna and
SGS. (Container inspection equipment)
 As part of a secret deal, the judge found, the Swiss contractors
funneled $11.9 million in bribes into three offshore firms in the
British Virgin Islands and ultimately into bank accounts in
Geneva.
 The judge found that Zardari owned the third company, Bomer
Finance, which received about $8 million, and that “Bhutto
shares with her husband the assets” and “has power of
disposition” over the company, according to the documents.

12. Continued….
 Zardari is accused of using illicit funds to acquire the 365-acre
Rockwood estate, a $6.5-million property featuring a Tudor-
style mansion and two adjoining farms in the Surrey district.
 In 1995, a leading French military contractor, Dassault Aviation,
agreed to pay Mr. Zardari and a Pakistani partner $200 million
for a $4 billion jet fighter deal that fell apart only when Ms.
Bhutto’s Government was dismissed.
 In the largest single payment investigators have discovered, a
gold bullion dealer in the Middle East was shown to have
deposited at least $10 million into an account controlled by Mr.
Zardari after the Bhutto Government gave him a monopoly on
gold imports that sustained Pakistan’s jewelry industry.
 In 1994 and 1995, he used a Swiss bank account and an
American Express card to buy jewelry worth $660,000 —
including $246,000 at Cartier Inc. and Bulgari Corp. in Beverly
Hills, Calif., in barely a month.

13. International Cases
 Birmingham CASE:A gang of 32 men who laundered more than
£180 million for drug traffickers have been jailed for a total of 140
years.
 A total of £160 million flowed through the firm’s accounts
between September 2008 and March 2011.
 HSBC CASE :Mexico's Sinaloa cartel and Colombia's Norte del
Valle cartel between them laundered $881 million through HSBC
and a Mexican unit, the U.S. Justice Department said.
 HSBC Holdings Plc agreed to pay a record $1.92 billion in fines
to U.S. authorities for allowing itself to be used to launder a river
of drug money flowing out of Mexico and other banking lapses.

14. International Laws on money
laundering

15. The Financial Action Task Force
 Inter-governmental body established in 1989 by the Ministers of
its Member jurisdictions
 In collaboration with other international stakeholders, the FATF
also works to identify national-level vulnerabilities with the aim of
protecting the international financial system from misuse.

16. Members of FATF
 France
 Germany
 Greece
 Gulf Cooperation
Council
 Norway
 Portugal
 Russia
 Singapore
 South Africa
 South Korea
 Spain
 Sweden
 Hong Kong
 Iceland
 India
 Ireland
 Italy
 Japan
 Luxembourg
 Mexico
 Netherlands
 New Zealand
 Switzerland
 Turkey
• Argentina
• Australia
• Austria
• Belgium
• Brazil
• Canada
• China
• Denmark
• European
Commission
• Finland
• United Kingdom
• United States

17. Primary functions of FATF
 Identify the risks, and develop policies and domestic
coordination;
 Pursue money laundering, terrorist financing and the financing of
proliferation
 Apply preventive measures for the financial sector and other
designated sectors
 Establish powers and responsibilities for the competent
authorities (e.g., investigative, law enforcement and supervisory
authorities) and other institutional measures
 Facilitate international cooperation

18. Recommendations
1. Assessing risks and applying a risk-based
approach
2. Money laundering offence
3. Non-profit organizations
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19. European Requirements
 The European Federation of Accountants (FEE) has a Money
Laundering Task Force, which coordinates AML policy for the
profession across Europe, including lobbying the European
Commission and FATF. FEE has issued a survey on the
implementation of the Third Money Laundering Directive in
September 2009, and a Fact Sheet on money laundering and the
fight against organized crime in October 2003.
 The European Union's current requirements are as laid out in
the Third Money Laundering Directive

20. US requirements
 The United States of America has strict federal AML systems and
procedures requirements on banks and certain other financial
institutions, which tend to have extra-territorial effect, through
requirements for US banks to control their relationships with
correspondent and shell banks. As at August 2009, it has not
introduced systems and procedures requirements on law or
accountancy firms.

21. Anti-Money Laundering Law of
Pakistan

23. AMLA ‘10
 On 27 March 2010, the Federal Government of Pakistan
promulgated the Anti-Money Laundering Act, 2010.

24. Offence of Money Laundering:
 (i) acquires, converts, possesses or transfers
property, knowing or having reason to believe that
such property is proceeds of crime; or
 (ii) renders assistance to another person for the
acquisition, conversion, possession or transfer of, or
for concealing or disguising the true nature, origin,
location, disposition, movement or ownership of
property, knowing or having reason to believe that
such property is proceeds of crime.

25. • Which Court has Jurisdiction?
• Appeal to High Court
• Non-Cognizable and Non-Bailable
• Corporate Liability

26. OVERSIGHT INSTITUTIONS:
• National Executive Committee
• General Committee

27. INVESTIGATION, PROSECUTION
AND ADJUDICATION
• Search of Persons
• Surveys
• Investigation
• Arrest

28. Drawbacks of Anti-Money
Laundering Laws
 These laws have become expensive and intrusive
 Adverse affects on population, NGOs, public
remittances of the third world countries
 Costly for the banking and financial sector

29. The Western Union Case
 Giving the task of spying on the customers
 Transforming the WU model into its liabilities
 73 changes into its system

30. Minimizing the Risk of Money
Laundering
 No individual state has power to curb down money
laundering
 The most prominent international organization in this
respect is probably the Financial Action Task Force
(FATF)

31. Cont’d
 The measures given by FATF on banking
sector are:
 Identify and do background checks on depositors.
 Build an internal taskforce to identify laundering clues
 Financial institutions should not keep anonymous
accounts or accounts in obviously fictitious

32. Cont’d
 Financial institutions should, in relation to
politically exposed persons, in addition to
performing normal due diligence measures:
 Have appropriate risk management systems to
determine whether the customer is a politically
exposed person.
 Obtain senior management approval for establishing
business relationships with such customers.
 Take reasonable measures to establish the source of
wealth and source of funds.
 Conduct enhanced ongoing monitoring of the
business relationship.

33. Cont’d
 Financial institutions should maintain, for at
least five years, all necessary records on
transactions, both domestic or international,
to enable them to comply swiftly with
information
 Financial institutions should pay special
attention to all complex, unusual large
transactions, and all unusual patterns of
transactions, which have no apparent
economic or visible lawful purpose

34.  If a financial institution suspects or has
reasonable grounds to suspect that funds are the
proceeds of a criminal activity, or are related to
terrorist financing, it should be required, directly
by law or regulation, to report promptly its
suspicions to the financial intelligence unit (FIU).

35. THANK YOU!!!!!!!!