Gov’t, not just BSP, working to exit from FATF’s 'grey list'

Published September 2, 2021, 5:58 PM

by Lee C. Chipongian

Bangko Sentral ng Pilipinas (BSP) Governor Benjamin E. Diokno said the BSP, the Anti Money Laundering Council (AMLC) and the whole of government are working together for the removal of the Philippines from the Financial Action Task Force’s (FATF) “grey list”.

BSP Governor Benjamin Diokno

“The AMLC and the rest of the Philippines is continuously working toward the country’s removal from the FATF ICRG (International Co-operation Review Group) ‘grey list’. Despite the constant adversity brought about by the COVID-19 pandemic and other obstacles, we ultimately pursue a more robust regime not only against financial crime but against other lawlessness related to it,” said Diokno in a webinar, “Good Governance Out of the Grey List: Meeting Global Standards Against Financial Crime and Corruption Prevention”, hosted by business groups including the Makati Business Club on Thursday.

To get out of the FATF watch list, the Philippines must resolve and address 18 ICRG action plan items.

“It must be emphasized that all AML/CTF players, such as law enforcement and government agencies; and covered persons, are required to demonstrate effectiveness to address these 18 action plan items, whichever applicable.

A significant challenge then is ensuring accountability among government agencies on the action plan items that they need to deliver,” said Diokno.

The Philippines is prepared to do this since the National AML/CFT Coordinating Committee or the NACC is already in place since 2018, for a whole of government approach. Diokno is vice-chair of NACC.

Diokno said the AML/CTF legal and institutional framework “is producing the expected results over a sustained period.”

“Thus, the country has been identified as a ‘jurisdiction under increased monitoring’ or, in other words, placed in the ‘grey list’ generally because the Philippines would need time to implement its new AML/CTF laws, regulations, and other relevant issuances to demonstrate their effectiveness,” said Diokno. “Grey-listed jurisdictions, such as the Philippines, must swiftly resolve all identified deficiencies within a timeframe and must report its progress to the FATF frequently, thus, the term ‘increased monitoring’.”

About 63 cases have been filed by the AMLC for the first six months of 2021. These filed cases are on money laundering and terrorism financing cases, civil forfeiture cases, and even administrative cases.

“Through these cases, the AMLC has deprived money launderers and other criminals of over P3.3 billion and various assets, including 121 hectares of real properties that were subject of freeze orders related to terrorism and terrorism financing,” said Diokno.

These freeze orders include a five-hectare land from the United Nations Security Council Resolution-designated individuals frozen in 2019, he said. “In a Council-issued Resolution in March 2021, real property owned by a certain alleged associate of a designated-terrorist group was also subject of a freeze order.

Further, this year, there has been a money laundering case conviction predicated on the violation of the E-Commerce Act in relation to cybercrime,” added Diokno.

Diokno said earlier that 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.

The Philippines has addressed the technical deficiencies with the AML/CTF laws such as the Anti-Terrorism Act of 2020 and amendments to the Anti-Money Laundering Act of 2001.

The Philippines will submit progress reports to the FATF three times a year. The first report will be submitted this month.

The FATF placed the Philippines on its “grey 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.