Dr. Ikramul Haq & Abdul Rauf Shakoori
The fourth Financial Action Task Force (FATF) Plenary, held from October 22-24, 2025 in Paris under the Mexican Presidency of Elisa de Anda Madrazo, concluded with a reinforced global commitment to divesting the criminals of their illicit gains and strengthening the integrity of the international financial system.
The meeting brought together delegates from the FATF’s Global Network, representing more than 200 jurisdictions and observers, to deliberate on strategic priorities in combating money laundering, terrorist financing, and proliferation financing. The discussions marked the beginning of a new phase of evaluations under the FATF’s enhanced methodology, reflecting the organization’s focus on measurable outcomes and practical implementation rather than formal compliance alone.
The Plenary adopted the first two mutual evaluation reports under the new round of assessments for Belgium and Malaysia. Both countries were evaluated under the restructured, more time-bound, and risk-based framework that places greater emphasis on effectiveness and measurable results in combating financial crime.
The new evaluation approach assigns each jurisdiction a defined roadmap with key recommended actions to be completed within three years. This time-bound and outcome-oriented model signifies a shift from process-oriented assessments to impact-based accountability. The reports will undergo a global quality and consistency review and are scheduled for publication in December 2025.
The Plenary also delivered important progress on jurisdictions previously under increased monitoring. Burkina Faso, Mozambique, Nigeria, and South Africa were officially removed from the FATF’s “grey list” after demonstrating substantial progress in addressing their strategic deficiencies and fulfilling their respective Action Plans within agreed timelines.
Each jurisdiction underwent a successful on-site visit confirming the sustainability of reforms before their removal from monitoring. Burkina Faso and Nigeria will continue working with the Inter-Governmental Action Group Against Money Laundering in West Africa (GIABA).
Mozambique will continue coordination through the Eastern and Southern Africa Anti-Money Laundering Group (ESAAMLG), and South Africa, as a FATF member, will maintain its collaboration with both FATF and ESAAMLG.
The FATF also reaffirmed its approach to jurisdictions facing serious strategic deficiencies by updating its call for action on Iran, highlighting the organization’s continued attention to jurisdictions posing systemic risks to the global financial system. These actions demonstrate FATF’s balance between recognition of progress and continued vigilance toward persistent non-compliance.
A major development at the Plenary was the adoption of comprehensive new guidance on asset recovery. The FATF recognized that the global level of asset recovery remains unsatisfactory despite widespread legal reforms and institutional development.
The new guidance provides member countries with a practical framework to improve the identification, freezing, confiscation, and management of criminal assets, including assets held abroad. It builds on recently strengthened FATF Standards, offering jurisdictions a broader toolkit to target proceeds of crime and improve international cooperation. The initiative seeks to address one of the most persistent challenges in financial crime enforcement, ensuring that confiscation and recovery of illicit proceeds match the scale of criminal activity.
Another key outcome was the approval of a “Horizon Scan” focused on emerging risks arising from artificial intelligence (AI), including the misuse of generative AI models and deepfakes. The FATF acknowledged the growing potential of such technologies to facilitate new forms of cyber-enabled fraud, identity manipulation, and money laundering.
The Horizon Scan provides case studies and risk scenarios to guide governments and private-sector institutions in developing appropriate safeguards, monitoring mechanisms, and compliance strategies. This forward-looking initiative highlights FATF’s recognition that illicit finance threats evolve rapidly and that emerging technologies require agile and preventive responses.
The Plenary further strengthened the FATF’s Global Network through expanded participation under its Guest Initiative. Jamaica and Nigeria joined Kenya in participating as guests for the first time. This initiative aims to enhance regional engagement, strengthen cohesion across the global AML/CFT community, and promote a shared understanding of challenges faced by different jurisdictions.
Broader representation from various regions ensures that the FATF’s global standards remain inclusive and adaptable to diverse legal, institutional, and economic contexts.
Overall, the October 2025 Plenary outcomes demonstrate the FATF’s strategic direction in several key areas. The first is an intensified focus on effectiveness, ensuring that jurisdictions demonstrate tangible results, not just compliance with formal standards.
The mutual evaluations of Belgium and Malaysia are the first test cases under this philosophy and will serve as benchmarks for future assessments. The second is FATF’s commitment to rewarding progress while maintaining pressure on lagging jurisdictions. The delisting of four countries after rigorous follow-up signals that consistent implementation yields recognition and relief, while continued deficiencies result in sustained scrutiny.
The third priority area evident from the Plenary discussions is the need to enhance asset recovery mechanisms. Criminal enterprises continue to exploit jurisdictional gaps and procedural delays to retain illicit wealth, undermining deterrence.
The FATF’s new guidance encourages member states to take more assertive action, including expanded powers for extended confiscation, improved cooperation between financial intelligence units, and streamlined mutual legal assistance procedures. This development reinforces FATF’s long-term objective by making financial crime unprofitable and ensuring that proceeds of corruption and organized crime are returned to lawful use.
The fourth and increasingly vibrant focus is technological adaptation. As AI tools reshape finance, the FATF’s Horizon Scan urges regulators and private institutions to swiftly address potential AI-related risks. The ability of criminals to create convincing deepfakes or automate identity theft presents real risks for financial institutions, compliance systems, and law enforcement agencies. The FATF’s approach encourages proactive innovation — developing compliance frameworks that use technology to counter technology.
For countries preparing for upcoming mutual evaluations, including Pakistan, the October 2025 Plenary carries important lessons. The new FATF assessment methodology places strict emphasis on timeliness, quantifiable outcomes, and inter-agency coordination. Pakistan, which has previously undergone intense scrutiny under the FATF framework, should internalize these developments and begin early preparation to demonstrate resilience and sustained improvement.
First, Pakistan should align its national anti-money laundering, counter-terrorism financing, and proliferation financing frameworks with the new FATF methodology, focusing on outcomes rather than procedural compliance. This requires establishing measurable indicators for effectiveness, such as conviction rates, asset recovery volumes, and supervisory actions, rather than relying on legislative checklists.
Second, Pakistan should strengthen its asset recovery mechanisms. The new FATF guidance highlights the importance of demonstrating actual recoveries and international cooperation. Pakistan should review its current asset-tracing and confiscation tools, improve inter-agency collaboration, and enhance cooperation with jurisdictions where illicit assets may be held. Practical reforms such as digitized asset registries, expedited judicial processes, and reciprocal enforcement of foreign confiscation orders will be essential.
Third, Pakistan must enhance its understanding and management of emerging technological risks. The FATF’s focus on Artificial Intelligence (AI) and deepfakes implies that countries will be evaluated on their ability to assess, regulate, and respond to such risks. Pakistan should conduct a dedicated national risk assessment covering AI, digital payments, and virtual assets. The development of regulatory sandboxes and capacity building for financial institutions to detect technology-based laundering schemes will be vital.
Fourth, Pakistan should maintain robust coordination among its financial intelligence unit, supervisory authorities, and law enforcement agencies. The examples of jurisdictions removed from the grey list demonstrate that consistent inter-agency cooperation and follow-through on Action Plans are key to achieving and sustaining FATF compliance. Pakistan should document and communicate its progress transparently to the FATF and its regional body, the Asia Pacific Group on Money Laundering (APG).
Fifth, Pakistan must continue to enhance beneficial ownership transparency and ensure the effective implementation of related regulations. FATF evaluations increasingly emphasize practical verification and enforcement rather than formal registration alone. Strengthening public access mechanisms, ensuring data accuracy, and sanctioning non-compliance will be crucial.
Lastly, Pakistan should institutionalize an ongoing system of monitoring and self-assessment that continues beyond the evaluation cycle. By embedding FATF-compliant practices into its financial governance and regulatory systems, Pakistan can reduce future risks of non-compliance, build investor confidence, and reinforce its global credibility.
The October 2025 FATF Plenary represents a significant transition toward a results-oriented and technology-aware global AML/CFT regime. The adoption of new evaluation standards, the delisting of compliant jurisdictions, and the issuance of updated asset recovery and AI guidance collectively signal a new phase of maturity in the global fight against illicit finance.
For Pakistan and similar regions, success in upcoming evaluations requires ongoing implementation, clear results, and responsiveness to financial and technological changes. Therefore, meeting these expectations will not only ensure alignment with FATF recommendations but also strengthen domestic financial integrity, support economic transparency, and enhance international confidence in the stability of national systems.
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Dr. Ikramul Haq, Advocate Supreme Court, specializes in constitutional, corporate, environment, media, ML/CFT related laws, IT, intellectual property, arbitration and international tax laws. He holds LLD in tax laws with specialization in transfer pricing. He was full-time journalist from 1979 to 1984 with Viewpoint and Dawn. He served Civil Services of Pakistan from 1984 to 1996. He established Huzaima & Ikram in 1996 and is presently its chief partner. He studied journalism, English literature and law.
He is Chief Editor of Taxation. He is country editor and correspondent of International Bureau of Fiscal Documentation (IBFD) and member of International Fiscal Association (IFA). He is Visiting Faculty at Lahore University of Management Sciences (LUMS) and member Advisory Board and Visiting Senior Fellow of Pakistan Institute of Development Economics (PIDE).
He has coauthored with Huzaima Bukhari many books that include Tax Reforms in Pakistan: Historic & Critical Review, Towards Flat, Low-rate, Broad and Predictable Taxes (revised & Expanded Edition, Pakistan: Enigma of Taxation, Towards Flat, Low-rate, Broad and Predictable Taxes (revised/enlarged edition of December 2020), Law & Practice of Income Tax, Law , Practice of Sales Tax, Law and Practice of Corporate Law, Law & Practice of Federal Excise, Law & Practice of Sales Tax on Services, Federal Tax Laws of Pakistan, Provincial Tax Laws, Practical Handbook of Income Tax, Tax Laws of Pakistan, Principles of Income Tax with Glossary and Master Tax Guide, Income Tax Digest 1886-2011 (with judicial analysis).
He is author of Commentary on Avoidance of Double Taxation Agreements, Pakistan: From Hash to Heroin, its sequel Pakistan: Drug-trap to Debt-trap and Practical Handbook of Income Tax. Two books of poetry are Phull Kikkaran De (Punjabi 2023) and Nai Ufaq (Urdu 1979 with Siraj Munir and Shahid Jamal).
He regularly writes columns/article/papers for many Pakistani newspapers and international journals and has contributed over 3000 articles on a variety of issues of public interest, printed in various journals, magazines and newspapers at home and abroad.
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Abdul Rauf Shakoori, Advocate High Court, is a subject-matter expert on AML-CFT, Compliance, Cyber Crime and Risk Management. He has been providing AML-CFT advisory and training services to financial institutions (banks, DNFBPs, Investment companies, Money Service Businesses, insurance companies and securities), government institutions, including law enforcement agencies located in North America (USA & CANADA), the Middle East and Pakistan. His areas of expertise include legal, strategic planning, cross-border transactions including but not limited to joint ventures (JVs), mergers & acquisitions (M&A), takeovers, privatizations, overseas expansions, USA Patriot Act, Banking Secrecy Act, Office of Foreign Assets Control (OFAC).
Over his career, he has demonstrated excellent leadership, communication, analytical, and problem-solving skills and has also developed and delivered training courses in the areas of AML/CFT, Compliance, Fraud & Financial Crime Risk Management, Bank Secrecy, Cyber Crimes & Internet Threats against Banks, E-Channels Fraud Prevention, Security, and Investigation of Financial Crimes. The courses have been delivered as practical workshops with case study-driven scenarios and exams to ensure knowledge transfer.
His notable publications are: Rauf’s Compilation of Corporate Laws of Pakistan, Rauf’s Company Law and Practice of Pakistan and Rauf’s Research on Labour Laws and Income Tax and others.
His articles include: Revenue collection: Contemporary targets vs. orthodox approach, It is time to say goodbye to our past, US double standards, Was Due Process Flouted While Convicting Nawaz Sharif?, FATF and unjustly grey listed Pakistan, Corruption is no excuse for Incompetence, Next step for Pakistan, Pakistan’s compliance with FATF mandates, a work in progress, Pakistan’s strategy to address FATF Mandates was Inadequate, Pakistan’s Evolving FATF Compliance, Transparency Curtails Corruption, Pakistan’s Long Road towards FATF Compliance, Pakistan’s Archaic Approach to Addressing FATF Mandates, FATF: Challenges for June deadline, Pakistan: Combating the illicit flow of money, Regulating Crypto: An uphill task for Pakistan. Pakistan’s economy – Chicanery of numbers. Pakistan: Reclaiming its space on FATF whitelist. Sacred Games: Kulbhushan Jadhav Case. National FATF secretariat and Financial Monitoring Unit. The FATF challenge. Pakistan: Crucial FATF hearing. Pakistan: Dissecting FATF Failure, Environmental crimes: An emerging challenge, Countering corrupt practices .
The recent publication, coauthored by these writes with Huzaima Bukhari is
Pakistan Tackling FATF: Challenges & Solutions, available at:
https://aacp.com.pk/book-detail/pakistan-tackling-fatf-challenges-and-solutions-35
https://www.amazon.com/dp/B08RXH8W46