KARACHI – The Pakistan Stock Exchange (PSX) has issued a significant directive, compelling stock brokers to file Suspicious Transaction Reports (STR) with the Financial Monitoring Unit (FMU) as part of efforts to combat money laundering and financing terrorism.
This development comes in alignment with clause 14(8) of the Securities and Exchange Commission of Pakistan (Anti Money Laundering and Countering Financing of Terrorism) Regulations, 2018.
In a notification released on Wednesday, the PSX invited TRE Certificate Holders to adhere to this crucial regulation. The regulation mandates that “regulated persons without disclosing the contents of STRs, shall intimate to the commission on a bi-annual basis the number of STRs reported to FMU, and the regulated persons shall ensure that a status report (indicating the number of STRs only) shall reach the AML Department within seven days of the close of each half-year.”
In accordance with this directive, all TRE Certificate Holders are advised to submit the STR Filing Status Report for the half-year ending on December 31, 2018, to the Securities and Exchange Commission of Pakistan (SECP), with intimation to the exchange, no later than January 18, 2019.
The PSX emphasized that TRE Certificate Holders must ensure the submission of each status report bi-annually within seven days of the end of each half-year. This regulatory initiative serves as a proactive step to bolster Pakistan’s financial system against illicit financial activities.
One critical aspect emphasized by the directive is that even if a TRE Certificate Holder has not filed any STR with FMU during the reporting period, they are still required to report this as ‘nil’ within the stipulated time frame. This provision ensures complete transparency in the reporting process, highlighting that even the absence of suspicious transactions must be documented for regulatory oversight.
The move by the PSX underscores the ongoing commitment of regulatory authorities in Pakistan to enforce strict measures to combat money laundering and the financing of terrorism. The importance of reporting suspicious transactions cannot be understated, as these reports play a pivotal role in identifying and preventing financial crimes.
By requiring TRE Certificate Holders to adhere to these regulations, the PSX is proactively strengthening the financial regulatory landscape in Pakistan, demonstrating its commitment to international standards of anti-money laundering (AML) and countering the financing of terrorism (CFT).
This development also brings more accountability to the financial sector, as the exchange’s involvement in the reporting process adds an additional layer of scrutiny and compliance assurance.
The PSX’s decision to make these regulations known to TRE Certificate Holders serves as a reminder to all stakeholders that compliance with AML and CFT regulations is not just a legal requirement but also a collective responsibility to maintain the integrity of the financial system.
In conclusion, the PSX’s directive to compel stock brokers to file Suspicious Transaction Reports with FMU for AML and CFT compliance reflects a commitment to maintaining the highest standards in the financial sector. By enforcing these regulations, Pakistan’s regulatory authorities aim to create a more transparent and secure financial environment, safeguarding the nation’s financial system from money laundering and the financing of terrorism. This development underlines the need for ongoing vigilance and cooperation in the battle against financial crimes.
