The Philippines is on track to getting out of the “gray list” of global money laundering watchdog, the Paris-based Financial Action Task Force (FATF), by January 2025.
Bangko Sentral ng Pilipinas (BSP) Governor Eli M. Remolona Jr. said Monday, July 8, that by October this year, they should have already completed the 18 action items that FATF has required the country to implement to be delisted from the gray list. The gray list is the common name for the list of jurisdictions that FATF closely monitors for dirty money issues.
“We’ve made very big progress. We have 18 action items to fulfill. We've officially fulfilled 15 of the 18. This had become classified as largely addressed and we still have three more action items to work on,” said Remolona in an economic forum hosted by the Economic Journalists Association of the Philippines (EJAP) with San Miguel Corp.
He revealed that in the recent meetings, FATF has informed the Philippines through its financial intelligence unit, the Anti Money Laundering Council (AMLC) which is chaired by Remolona, that they are “making good progress”.
“I think by October we should be able (to have) largely addressed (the) three remaining items. We don't get out of the gray list by October. Once we’ve been told we have largely addressed those three remaining items, there's an exit process that then ensues,” he explained.
“If that works out, you have to come there in January to check whether what we said is true. If that works out, then we will exit in January (2025),” said Remolona.
He added that “in October they decide whether we have fulfilled the 18 (action items). And then between October and January, they check. January is the exit date.”
A recent statement from the FATF dated June 28 has noted that the Philippines is still on the watchlist. The country is one of the 21 jurisdictions under increased monitoring with updates that are working actively with FATF to address deficiencies to counter money laundering, terrorist financing, and proliferation financing.
The FATF reviewed the country’s progress report last February 2024.
In its own statement, the AMLC said the Philippines has addressed items in its International Co-operation Review Group (ICRG) action plan. The ICRG analyzes high-risk jurisdictions and recommends specific actions to deal with the money laundering and terrorism financing risks.
The FATF has reiterated that since June 2021, the Philippines has made “a high-level political commitment” to work with the FATF and the Asia/Pacific Group on Money Laundering (APG) to strengthen the effectiveness of its anti-money laundering (AML) and combating financing of terrorism (CFT).
“(The) Philippines has taken significant steps towards improving its AML/CFT regime, including by demonstrating an increase in ML (money laundering) investigations and prosecutions in line with risk; enforcement of beneficial ownership transparency obligations and law enforcement access to those beneficial ownership data records; and that risk-based supervision of DNFBPs (designated non-financial businesses and professions) is occurring,” said FATF.
The FATF added that the Philippines “should continue to work on implementing its action plan to address its strategic deficiencies”. These include the following: demonstrating that supervisors are using AML/CFT controls to mitigate risks associated with casino junkets; applying cross-border measures to all main sea/airports including detection of false declarations of currency and confiscation action in line with risk; and demonstrating an increase in the prosecution of terrorist financing cases in line with risk.
The AMLC said the Philippines will indeed continue to work on implementing its action plan to address remaining deficiencies, such as those identified by the FATF.
The original deadline given the Philippines to implement action plans was January 2023. After a year of extension or until January 2024, the country sought another extension to address the deficiencies.
Last January, Malacanang ordered concerned or relevant government agencies implementing AML/CFT measures to expedite efforts in “addressing deliverables set by FATF within the year.” Besides AMLC, the National Anti-Money Laundering/Counter-Terrorism Financing/ Counter-Proliferation Financing Coordinating Committee (NACC) makes sure there is a unified approach among relevant agencies in enforcing action plans as per the FATF requirements.
As of June 28, there are 21 countries under the gray list with updated statements from the FATF including the Philippines. The other countries are Bulgaria, Burkina Faso, Cameroon, Croatia, Democratic Republic of Congo, Haiti, Mali, Mozambique, Nigeria, Senegal, South Africa, South Sudan, Tanzania and Vietnam.
Meanwhile, FATF said Kenya, Namibia, Syria and Yemen deferred their reporting. The FATF also announced that Monaco and Venezuela has been added to the gray list while also removing Türkiye and Jamaica.
The Philippines has been one of jurisdictions closely watched by FATF since June 25, 2021. As a watchlisted country, it means the Philippines is subject to increased monitoring and is required to actively work with the FATF. Failure to be removed from the gray list will have an impact on the country’s financial reputation on a global scale.