Bangko Sentral ng Pilipinas (BSP) Governor Benjamin E. Diokno said Thursday, (July 1) that the Philippines will actively pursue its exit from the ‘grey list’ of the global anti-money laundering watchdog, Financial Action Task Force (FATF), and will closely monitor its impact on the economy.
“We are confident that the Philippines will exit the grey list by January 2023,” said Diokno. He also said that the BSP and the government “will actively work with the FATF and will swiftly resolve the identified deficiencies within the time frame through the cooperation of all agencies concerned.”
Diokno said that so far, they have not observed any impact or changes in the cost of doing cross-border banking due to the recent FATF’s statement on the country’s increased “dirty money” monitoring.
“(The) BSP will continue to monitor developments in this space and closely engage the industry to provide necessary guidance and assistance to our supervised financial institutions,” he said during his weekly “GBED Talks” online.
Diokno said the FATF has already noted the government’s progress on a number of its mutual evaluation report or MER-recommended actions to “improve technical compliance and effectiveness including addressing technical deficiencies on targeted financial sanctions.”
“It is for this reason that the mere inclusion of the Philippines in the list of jurisdictions under increased monitoring or the grey list did not automatically mean the imposition of countermeasures,” he said.
The BSP chief said the Philippines has addressed the technical deficiencies with the anti-money laundering/counter-terrorism financing or AML/CTF laws such as the Anti-Terrorism Act of 2020 and amendments to the Anti-Money Laundering Act of 2001.
Diokno said there are no pending bills or legislative measures in the pipeline as “Congress has already delivered what was required of them.”
Even the proposed changes to the bank deposits secrecy law has already been recognized by FATF, especially since the Anti-Money Laundering Council (AMLC) is exempted from the restrictions of the said law. The AMLC also has an unimpeded access to bank account information due to the latest version of the AMLA.
The Philippines will submit progress reports to the FATF three times a year, in January, May and September. The first report will be submitted in September.
“Should the Philippines fail to meet the deadlines in accomplishing the 18 action items (plans), the FATF may consider calling on countries to impose countermeasures against the Philippines,” said Diokno.
The FATF placed the Philippines and other countries on its jurisdictions with strategic deficiencies watch list on June 25.
The last time the Philippines was on the grey list was in 2013. It was even on the FATF “black list” in 2000, before the AMLA when the country has no anti-money laundering legal framework.
The year 2010 was the first time the Philippines landed on the grey list and was even downgraded to the “dark grey list” in 2012 for failing to comply with some provisions.
By 2017, the Philippines was removed from the FATF watchlist up until last Friday, when it was grey-listed once more.