1. United Nations Security Council Resolutions (UNSCR’s) & CFT Preventative Target Financial Sanctions Measures

2. UNSCR’s
Identify solutions for addressing requirements for effective implementation of UNSCR ‘s 1267, 1373, 2178 & 1540
Provide a forum for fostering communication and
exchange of information between regional key stakeholders responsible for implementing UNSCR’s;
Support increasing awareness of UNSCR ‘s and global standards requirements, to assist Paksitan to develop and implement effective regimes in line with the international standards requirements
Share “best practices” and develop guidelines to increase awareness to support countries’ successful implementation UNSCR’s regimes ;
Enhance domestic cooperation (LEA’s, FIU and Financial Sectors and other CFT stakeholders) and international cooperation between key agencies for implementing UNSCR’s 1373 (domestic)

3. The universal legal regime against CFT & Terrorism
Security Council
resolutions 1373
and 1624
Security Council
resolutions on
Al-Qaida
and the Taliban
( )
Security Council
resolutions 1540
and 1673
(weapons of mass
destruction)
Security Council
Resolutions
2178
(ISIL & Foreign
Terrorist
Fighters)
19 universal
instruments
against
terrorism
FATF Global Standards 40 Recommendations

4. The Universal Legal Framework Against Terrorism
19 international conventions and protocols against terrorism, under the auspices of:
UN IAEA ICAO IMO
Relevant United Nations Security Council resolutions:
Many adopted under Chapter VII of the UN Charter which means that they are legally binding on all UN member states
Through some of the provisions of the conventions and protocols compliance with UNSC resolutions is facilitated
1267 (1999) (2011) and 1989 (2011) (Al-Qaeda and Taliban sanctions regime)
1373 (2001) (Threats to international peace and security caused by terrorist acts)
1540 (2004) (Non-proliferation of weapons of mass destruction)
2178 (2014) Foreign Terrorist Fighters / 2130 ISIS

5. Who Could be Involved? Police or Prosecutor or FIU execute TFS
Without delay Considerations
What is reasonable?
How many agencies?
How many steps?
Approvals required?
How long does each step take?
More than days – usually not acceptable
Who Could be Involved?
UN Advisory or 3rd Party
UNSCR 1373
Could be the same authorities for Implementing UNSCR involved in 1373 processes – designation and implementation
Domestic Situation
Who is the Lead Agency? Could be FIU, LEA, Ministry of Justice(MOJ) or Attorney General’s Office (AGO)
Police, MOJ or AGO ? initiate processes for TFS (1373)
Freezing processes
Depends on Model Country adopts Options 1,2 or 3
Designating persons & identifying assets to freeze pursuant to pursuant to UNSCRs 1373
Who could be involved ** CT Intelligence Agencies, Police, FIU, Customs or International Partners 1 3 2
Committee
Court
Police or Prosecutor or FIU execute TFS

6. How to work together effectively

7. Presentation Title

11. Presentation Title

12. Targeted Financial Sanctions (TFS)
Recommendation 6
Targeted Financial Sanctions (TFS) required in Terrorist Financing UNSCRs
Particularly: UNSCR 1267, 1373, and successor resolutions
Recommendation 7
TFS required in proliferation related UNSCRs
Particularly: UNSCR 1718, 1737, and successor resolutions imposing TFS in context of financing of WMD proliferation
Definition of TFS : “Both asset freezing and prohibitions to prevent funds or other assets from being made available, directly or indirectly, for the benefit of designated persons and entities”

14. UNSCR 1267 (1999) et al.
Impose sanctions against DESIGNATED persons and entities associated with Taliban, Al Qaida, ISIL, Al Nusrah Front etc.
Travel Embargo
Arms Embargo
Financial Sanctions - Asset Freezing
Legally binding on all UN Member States under Chapter VII of the UN Charter
UNSCR 1988 (2012) – Consolidated List on Taliban and Al Qaida split into two -
Al Qaida, and elements of the Taliban
UNSCR 2253 (2015) ISIL Da’esh) and ANF added to the

15. General designation requirements Pursuant to 1373
It is for Member States to determine how to identify and designate persons and entities whose funds and assets are to be frozen pursuant to resolution 1373 (2001).
Member States may adopt: a judicial procedure, in which the freezing decision is made by a judicial authority; or an administrative procedure, in which a decision to designate and freeze is taken by an administrative authority; or a combination of the two.
Designation should be done without delay and without giving prior notice to the designated person or entity.
Designations should be regularly reviewed and due consideration should be given to ensuring fair treatment, including in connection with requests for delisting or for partial “unfreezing” (incl. designations requested by third parties).

16. Recommendation 2: Domestic Cooperation & Coordination
Identification and coordination of relevant competent authorities for effective implementation of UNSCRs 1267, 1373 and combating the financing of proliferation of weapons of mass destruction (1718 and 1737)
Effective mechanisms to coordinate on the development and implementation of policies and activities to address UNSCRs

17. Key Stakeholders Counter Terrorism & Counter Financing of Terrorism

18. Key Agencies that could be involved:
Rec 2: Coordination of Key Agencies for Combating Proliferation Financing and 1267 & 1373
Key Agencies that could be involved:
Export Control & Customs/Border Control
Intelligence Services
Financial Intelligence Units & Financial Institutions
Law Enforcement & Prosecution Agencies
Financial Supervisors
Trade Promotion
Government Policy Departments/Designations
Need to Coordinate on Investigations, Policy Development, Responses to Key Threats

19. R2: Coordination of Key Agencies for Combating Proliferation Financing and 1267 & 1373
Coordination among Justice, Finance, and Ministry of Foreign Affairs for development of all TFS designations.
Coordination among FIU, Law Enforcement, Commerce, and AML/CFT Financial Supervision authorities to take joint action against a proliferation network or 1373 and 1267 situations.
Financial Sectors – banking, MSB’s, DNFPB ’s

20. UNSCR’s Differences between Criminal Procedures
Terrorist
Asset-Freezing
Seizure/blocking/freezing/forfeiture/confiscation
Procedural feature
Administrative/Judicial
procedure
Criminal procedure
Nature
Preventive
Disruptive
Punitive
Scope of funds/assets
Broad
(all)
Limited
(specific)
Legal effect
Restriction of use/disposition (no deprivation of ownership)
Deprivation of property rights
(confiscation)
Evidential threshold
Lower
Higher

21. UNSCR’s in practice
Put in place a legal basis for TFS pursuant to UNSCR 1267.
Receive designations by the Sanctions Committee through the UN delegation.
Disseminate designations to natural and legal entities that may hold targeted funds, including but not limited to FIs, DNFBPs, NPOs and the company registry.
In case of a match, freeze the funds without delay and prior notice. Noncompliance with the obligation will be sanctioned.
The designated authority reports back to the UN that funds have been. The freeze has to be maintained for as long as it is deemed necessary by the UN Sanctions Committee. Countries are not competent to unfreeze funds unless a person has been delisted by the Sanctions Committee.

22. Security Council Resolution 1373
Prevention and Suppression of Terrorist Financing
Criminalization of terrorist financing
Freezing of funds of terrorist individuals and terrorist organisations who plan, facilitate or commit terrorist acts
Prohibition of providing resources for the benefit of terrorist individuals and organisations

23. Terrorist Financing: Adicional Requirements
Security Council Resolution 1373 has an additional obligation to the Convention:
Prohibition of the provision of financial support to terrorist organizations - obligation to suppress funds and services to terrorist organizations

24. Common Features of the UNSCR’s frameworks
All three resolutions impose obligation on Member States to freeze any assets owned or controlled by a designated individual, group or entity
All three resolutions set out freezing mechanisms as preventive measures that can/must be applied also in the absence of any criminal evidence
Freezing measures under all three frameworks apply to all assets, whether movable or immovable of targeted individuals, groups or entities
Freezing measures under all three frameworks must be able to be maintained indefinitely, if necessary. This is in contrast to criminal freezing measures, which are usually temporary in nature and tied to an ongoing criminal investigation, prosecution or court trial.

25. Proliferation financing
UN Security Council resolution 1540 (2004)
- Adopted under the Chapter VII = Binding obligations to adopt legislation to prevent the proliferation of nuclear, chemical and biological weapons, and their means of delivery and establish appropriate domestic controls over the related materials to prevent their illicit trafficking.
- Non-State actors only
Committee – Not sanctions Committee
Committee Expert Group
14 on-going UN sanctions regimes (Somalia and Eritrea, ISIL (Da’esh) & Al-Qaida, Iraq, DR of Congo, Sudan, Lebanon, DPRK, Libya, Afghanistan, (Guinea-Bissau), Central African Republic, Yemen, South Sudan and Mali) – 13 contains asset-freezing
- Proliferation financing & asset-freeze --- DPRK and Iran only
- Designation and de-listing --- by the Security Council or the Committee

26. Targeted financial sanctions related to proliferation
FATF Recommendation 7
Targeted financial sanctions related to proliferation
Countries should implement targeted financial sanctions to comply with U.N. Security Council resolutions relating to the prevention, suppression and disruption of proliferation of weapons of mass destruction and its financing.
These resolutions require countries to freeze without delay the funds or other assets of any person or entity designated by, or under the authority of, the UNSC under the Chapter VII of the UN:

27. Resolution 2178 (2014)
Criminalization of the financing the travel of foreign terrorist fighters (FTFs)
Paragraph 6 (b): “… to finance the travel of individuals who travel to a State other than their States of residence or nationality (FTFs) for the purpose of the perpetration, planning, or preparation of, or participation in, terrorist acts or the providing or receiving of terrorist training”

28. Summary of Flow of National Terrorist Designation and Asset-Freezing Process

29. UNSCR 1267 and 1373-Communication mechanisms, guidance and compliance
Implement effective systems for immediately communicating actions taken under freezing mechanisms to the financial sector and other relevant parties.
Issue clear guidance to financial institutions and other persons or entities that may be holding targeted funds or other assets on what to do in case of a match.
Empower the relevant authority to monitor compliance with relevant laws, regulations and rules, and impose sanctions for non-compliance where appropriate 29

30. SANCTIONING REGIME Sanctions should be effective and dissuasive (a).
Sanctions should be proportionate to the seriousness of a situation (b)
Range of sanctions should be broad (c)
Sanctions should be applied to institutions as well as to senior management (d)

31. SANCTIONING REGIME
(a) Sanctions should be effective and dissuasive.
-Effectiveness should be understood as a regime where sanctions are actively applied by relevant authorities;
-Dissuasiveness is more difficult to define since it refers to a combination of factors comprising effectiveness, proportionality (see below) and nature of sanctions (deterrence).
As set forth in the FATF methodology, countries should ensure that effective, proportionate and dissuasive criminal, civil or administrative sanctions are available to deal with natural or legal persons covered by the FATF Recommendations that fail to comply with national AML/CFT requirements. The methodology however does not define the concepts of effectiveness, proportionality, and dissuasiveness.
It seems that effectiveness should be understood as a regime where sanctions are actively applied by relevant authorities.
Dissuasiveness is more difficult to define since it refers to a combination of factors comprising effectiveness, proportionality (see below) and nature of sanctions. For example, a small fine or a mere reminder to a bank would not be considered as a dissuasive sanction for serious breaches.

32. Questions
Why is it important for Pakistan to pursue Counter Financing of Terrorism (CFT) to effectively combat terrorism? ALL
Why is the effective implementation of the United Nations Security Resolutions (UNSCR) for Counter Financing of Terrorism (CFT) preventative measures to comply with United Nations (UN) obligations and the Financial Action Task Force (FATF) AML/CFT global standards important for Pakistan? The same question for sanctions such OFAC and other preventative sanctions for CFT? ALL
What are the benefits for the country, law enforcement and financial sectors if these measures are properly implemented? What are the risks for the judicial rule of law and financial sectors if the UNSCR’s are not properly implemented? ALL
What role does your agency lead for the effective implementing of the UNSCR’s? ALL
What are the present and future challenges that Pakistan as a country face for effectively implementing of the CFT preventative measures to fully comply with the international standards including the UN and FATF requirements? ALL

33. Thank you !