Philippines Takes Final Steps Towards Grey List Removal

The Philippines has achieved a major milestone in its efforts to exit the Financial Action Task Force (FATF) grey list, having addressed all 18 deficiencies in its anti-money laundering (AML) and counter-terrorism financing (CFT) controls. This achievement paves the way for the country to potentially leave the grey list in 2025, pending an on-site evaluation by FATF’s Asia/Pacific Joint Group (APJG) early next year.

Philippines on Track to Exit FATF Grey List After Completing AML/CFT Action Plan

The FATF placed the Philippines on its grey list in June 2021, flagging it for increased monitoring due to weaknesses in its AML/CFT framework. After rigorous efforts to meet FATF standards, the Philippines has now completed the remaining items in its action plan, positioning itself as a strong contender for removal from the grey list.

Key Points:

• The Philippines has completed all 18 requirements of the FATF action plan.
• A visit from the Asia/Pacific Joint Group (APJG) is expected in early 2025, marking the final evaluation phase.
• The Anti-Money Laundering Council (AMLC) and other agencies have bolstered AML/CFT measures, targeting high-risk areas like casino junkets, remittance operators, and non-profit organizations.

Compliance with FATF Standards

Among the final steps addressed by the Philippines were key areas such as risk-based supervision for casinos and Designated Non-Financial Businesses and Professions (DNFBPs), enhancing the effectiveness of the targeted financial sanctions framework for both terrorism and proliferation financing, and ensuring accurate beneficial ownership (BO) information.

The Philippine executive secretary, Lucas Bersamin, who serves as chairperson of the National Anti-Money Laundering and Combating of Terrorism Financing/Counter-Proliferation Financing Coordinating Committee, emphasized the significance of these achievements. “This milestone is a testament to the hard work and coordination across government agencies. It reflects our strong commitment to meeting the FATF’s stringent standards and ensuring the long-term protection of our financial system,” Bersamin said.

Quadcom Investigates Offshore Gaming Funds

In a related move to reinforce financial integrity, the Philippines’ House Quad Committee (Quadcom) is set to summon banks, the Anti-Money Laundering Council (AMLC), and the Philippine Anti-Organized Crime Commission (PAOCC) to a hearing focused on the flow of funds linked to offshore gaming operators.

According to Rep. Bienvenido “Benny” Abante, unusual fund transfers and activity in the stock market could be linked to offshore gaming operators moving their assets ahead of anticipated shutdowns. Abante highlighted concerns over “hidden operations” throughout the country, stating that while only 43 offshore gaming operators are currently licensed, as many as 400 are suspected of operating discreetly, particularly in gated communities and provincial areas.

Next Steps and Anticipated Impact

Following the successful completion of the action plan, the FATF’s APJG will conduct an on-site assessment in early 2025. A positive evaluation could officially remove the Philippines from the grey list, strengthening its standing in the global financial community and reassuring foreign investors.

With the completion of its FATF action plan, the Philippines is one step closer to leaving the FATF grey list. This achievement not only reflects progress in bolstering AML/CFT controls but also reinforces the country’s commitment to financial security and global regulatory standards. As the country awaits the APJG’s final evaluation, the groundwork laid by the AMLC and other agencies represents a robust foundation for a stronger and more transparent financial environment.