ISLAMABAD: Acceding to another demand of the International Monetary Fund (IMF), the government has finally allowed banks access to asset declarations of civil servants of BS17-22 as a prior condition for the opening of bank accounts as part of good governance and anti-corruption measures.

Banks will access the asset data of federal employees in the first phase at the time of opening bank accounts, a senior tax official told Dawn on Thursday. The conditionality is expected to extend to provincial employees as well in the next phase.

The official further said that access to assets has no revenue implications. This is a due diligence measure under the anti-money laundering act 2010. However, the banks will keep the information confidential from the public and will not release it at any cost to the general public.

It was an IMF structural conditionality that was agreed upon in the year 2018 that banks are allowed access to the asset declaration of civil servants. In this regard, the Federal Board of Revenue engaged banks before finalising the rules for the purpose.

On the second day of the make-or-break talks with the IMF, the FBR notified rules to be called the Sharing of Declaration of Assets of Civil Servants Rules 2023 through SRO80 of 2023. These rules will apply to federal employees only except the members of the judiciary and armed forces.

IMF set this condition in 2018; information to be kept confidential

Normally, banks ask for a source of income at the time of opening a bank account. In the case of salary, the bank asks for a salary slip as proof. However, in the case of other than salary incomes, the civil servant will declare his/her basic particulars through a one-pager to the bank officer.

The bank officer will then send it to FBR for verification of the assets whether the same has been declared in the declaration of the federal employee or not. A complete set of procedures is notified for this whole correspondence between banks and FBR.

FBR will share a simplified version of the declaration, based on the fields agreed with the State Bank of Pakistan, made by a civil servant in his electronic declaration filed with FBR.

As per the rules, the head of compliance of the bank will use a single authorised email address for the request or receipt of a simplified declaration. Each bank will notify four persons for making correspondence with the FBR for seeking data.

To keep the data confidential, the authorised officials of the bank will submit a declaration to the FBR that he/she will maintain the secrecy of the information that will be provided, and it will not be divulged to any person.

After receiving a request for information, FBR will provide simplified or abridged information, within five working days, through the authorised email. The FBR can deny a request only in exceptional cases, including when the asset declaration has not been filed, the civil servant is not covered under this Ordinance, or for any other similar reason that the FBR is unable to provide the requested information.

The FBR will notify the bank of the decision and the reason for the refusal, within five days from receipt of the request. In case of dispute, FBR’s decision will prevail, being the custodian of information.

The bank will provide bi-annual feedback on the use of information received by the bank as well as on the outcome of customer due diligence in terms of the success of new accounts opened and how the information helped the bank in establishing its client relationship.

Published in Dawn, February 3rd, 2023