The Philippines has been included in a global dirty money watchdog’s “grey list” of countries that will be subjected to increased monitoring to prove its progress against money-laundering and terrorist financing.
The Financial Action Task Force (FATF) released its grey list or jurisdictions that will be under increased monitoring and actively working to “address strategic deficiencies in their regimes to counter money laundering, terrorist financing, and proliferation financing.”
In addition to the Philippines, the FATF added Haiti, Malta, and South Sudan to the grey list.
This comes 16 years after the Philippines was removed from the FATF’s blacklist in February 2005. The Philippines was previously included in the FATF’s blacklist in 2000.
“When the FATF places a jurisdiction under increased monitoring, it means the country has committed to resolve swiftly the identified strategic deficiencies within agreed timeframes and is subject to increased monitoring,” the FATF said.
With its inclusion in the grey list, the Philippines now needs to submit progress reports to the FATF thrice a year.
“Given the recent identification of the Philippines as ‘Jurisdiction under Increased Monitoring’ with serious anti-money laundering/counter-terrorism financing (AML/CTF) deficiencies, the relevant government and law enforcement agencies’ sustained pledge to implement the 18 action plans within the prescribed timelines will be essential to the country’s removal from such list,” the Anti-Money Laundering Council (AMLC) said.
The AMLC emphasized that the Philippines will not yet be subjected to countermeasures.
“It is only when the country fails to meet the deadlines will the FATF call on countries to impose countermeasures against the Philippines. Hence, all government agencies involved should deliver expected outputs on the action plans pertaining to them,” the AMLC said.
The FATF said the Philippines needs to implement its action plan to demonstrate the effectivity of the risk-based supervision of covered non-financial businesses and professions.
To recall, Republic Act 11521 which tightened the country’s Anti-Money Laundering Law was legislated into law by Jan. 29, only days ahead of the Feb. 1 deadline set by the FATF for the country to show tangible progress that it has imposed tighter AML/CTF. The law included new covered persons such as real estate brokers and developers following earlier findings that some dirty money proceeds went into the industry.
The FATF will also be monitoring local authorities’ use of AML/CTF controls to mitigate risks associated with casino junkets or travels granted to prominent players; implementation of new registration requirements for money service businesses, including imposing sanctions for unregistered and illegal remittance operators.
The dirty money watchdog will also assess the streamlining of beneficial ownership information by various law enforcement agencies and ensuring information accuracy, and the increase in the use of financial intelligence and heightened money laundering investigations and prosecutions.
AMLC will likewise monitor whether the Philippines will step up the identification, investigation, and prosecution of terrorism financing cases. They will also gauge the country’s monitoring of non-profit sector activities to ensure they operate within framework against terrorism and proliferation financing.
In July last year, Republic Act 11479 or the controversial Anti-Terror Act of 2020 was legislated to boost measures against terrorism and proliferation financing.