Why did the government ban large prize bonds?

The government's ban on high-value prize bonds in Pakistan has been linked to the terms of the Financial Action Task Force (FTAF), which includes anti-money laundering measures. 

A former director general of debit office in the finance division, commented that the work was being done under the terms of the FATF. He said that earlier IMF and World Bank had also asked Pakistan to ban large prize bonds.

Former Debit Official said that high value prize bonds have become the easiest way to launder money. He said that the bonds are used as currency notes for transactions involving illegal transactions. He said that when someone's bond is seized, the people involved in black money buy the bond from them and launder their illicit wealth by paying them money.

He welcomed the ban on prize bonds worth Rs 7,500 and Rs 15,000 and said that it has been banned in the world for a long time and cannot be bought or sold. He said that the ban on Barrier Prize Bonds should be imposed in any case as it is not possible for the person from whose pocket the bonds came out to be the one.

 

He said that registered prize bonds are the correct procedure in which the person in whose name it is issued can re-deposit it in the bank or cash it in case of a prize. He also called it an important step towards documenting the economy and said that it would lead to a better documentation of the economy where the process of laundering black money would stop.

Economist Dr. Shahid Hassan Siddiqui confirmed that prize bonds are the easiest way to launder black money, which should be banned. He said he had been asking the government for five years to take steps in this regard and shut down this source of the black economy.

x