The International Monetary Fund (IMF) has called on Pakistan to enforce stricter monitoring of financial transactions in the real estate sector, citing concerns over money laundering and weak regulatory oversight, ARY News reported on Tuesday.
According to sources, the IMF expressed unease over the low number of suspicious transaction reports originating from the real estate industry and other non-financial businesses and professions. The global lender urged Islamabad to take urgent steps to curb trade-based money laundering and address loopholes in beneficial ownership information exchange.
The IMF has raised reservations about Pakistan’s financial monitoring systems, anti-money laundering framework, and banking sector oversight. The Fund is particularly worried that a significant portion of untaxed and undocumented wealth is being channeled into real estate, increasing the risk of illicit financial activity.
In response, the Federal Board of Revenue (FBR) recently conducted raids on several housing societies and launched investigations into concealed sales and undeclared income. The FBR had previously established a monitoring framework for the real estate sector under the Designated Non-Financial Businesses and Professions (DNFBP) regime, which forwards suspicious transaction reports to the Financial Monitoring Unit (FMU). However, the IMF has deemed the DNFBP system’s performance unsatisfactory and called for improved enforcement and compliance measures.
Pakistan has been under international scrutiny to strengthen its anti-money laundering regime. The Financial Action Task Force (FATF) has previously placed Pakistan on its grey list for deficiencies in combating money laundering and terrorist financing. The real estate sector has long been identified as a vulnerable area for illicit financial flows.
The IMF’s latest push aligns with broader efforts to enhance transparency in Pakistan’s property market. Analysts say strict monitoring could help bring undocumented wealth into the tax net and reduce money laundering risks.
For more on anti-money laundering efforts, see FATF and Reuters. Learn about Pakistan’s real estate sector at Wikipedia.
Source: ARY News