Philippines on the FATF’s gray list since 2021, as it advised the country to take measures to combat money laundering and financial risk.
The Anti-Money Laundering Council (AMLC) said it is continuing to address the strategic deficiencies identified by the Financial Action Task Force (FATF) in its efforts to combat "dirty money" and terrorism funding as the Philippines remained on the latter's "gray list."
“The remaining action plans for the Philippines focus on specific aspects of an effective anti-money laundering and countering the financing of terrorism.” AMLC Executive Director Matthew M. David said.
FATF kept the Philippines on its gray list of jurisdictions since June 2021. It is subjected to increased monitoring for dirty money risks, Business World reported.
Government officials expressed hope that the country will exit the gray list by January 2023.
Measures for money laundering and financial risk
The FATF advised that the country take steps to address money laundering and terrorism funding issues associated with casino junkets and beneficial ownership.
In addition, the country should improve its use of financial intelligence and money laundering investigations and prosecutions in line with risk.
The FATF has acknowledged the Philippines’ effort in combating financial crimes in terms of policies related to nonprofit organizations (NPO) and implementing supervision for targeted financial sanctions.
David said that the government has been addressing identified strategic deficiencies in its anti-money laundering and counter-terrorism financing (AML-CTF) framework through its National AML/CFT Coordinating Committee (NACC).
NACC will continue to work with government agencies to ensure that strategies and processes to address the action plans are in place.
David added that the AMLC will continue to assist the NACC as its secretariat.
FATF also wants the Philippines to streamline access to beneficial ownership information for law enforcement authorities.
“Supervisory agencies likewise have a role in risk-based supervision as guidelines are in place to examine and enforce AML/CFT controls such as a monitoring system to address the risks associated with casino junkets. Further, regulators ensure accurate and up-to-date (beneficial ownership) information.” David explained.
The FATF also noted that the Philippines should improve its detection, investigation, and prosecution of terrorism financing cases, as well as improve the effectiveness of the targeted financial sanctions framework for both terrorism financing and proliferation financing by demonstrating that designated nonfinancial businesses and professions understand their responsibilities.
Bank Secrecy Law
Meanwhile, the Bangko Sentral ng Pilipinas (BSP) said that the proposed changes in the country’s Bank Secrecy Law will also help in improving its efforts in fighting against money laundering.
The law is expected to pass the House of Representatives by next month. Since September 6, House Bill No. 4313, which proposes revisions to Republic Act No. 1405 or the Bank Secrecy Law, has been pending with the House Committee on Banks and Financial Intermediaries.
It aims to give the BSP the authority to investigate deposits for probable fraud, substantial irregularity, or illegal action by bank staff.
The Philippines will have a lot of obligations to work on to get off the FATF's gray list, but with thoughtful and improved strategy and implementation, the country can get off the FATF's gray list and improve its chance of fighting against financial risks.
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