Philippines progresses a little but still on FATF “grey list”

The Philippines remains on the “grey list” of the Paris-based watchdog Financial Action Task Force (FATF), which has called for the country to promptly address any remaining weaknesses in its defenses against money laundering. This designation means that the Philippines is subject to heightened scrutiny, particularly concerning its efforts to rectify specific deficiencies in its systems for combating dirty money and terrorism financing, as outlined by the FATF in a statement issued on Saturday.

This decision represents a crucial moment for President Ferdinand Marcos Jr.’s goal of having the Philippines removed from the grey list by October 2024. The FATF holds plenary meetings in February, June, and October each year.

The FATF recognised the Philippines’ high level political commitment and cited progress. This improvement in our AML/CFT regime is a strong recognition of the government’s efforts in curbing terrorism and terrorism financing incidents in the country. It also sends a positive signal to the international community on the unwavering commitment and continuous progress made by the Philippines in this front.

Matthew David, AMLC Secretariat Executive Director

According to the FATF, the Philippines’ failure to meet the requirements stems from its inability to establish effective risk-based supervision of non-financial sectors and vulnerable professions. These Designated Non-Financial Businesses and Professions include casinos, lawyers, accountants, and real estate agents.

Furthermore, the FATF emphasized that the Philippines must demonstrate the use of credible anti-money laundering and counter-terrorism financing controls, particularly concerning risks associated with casino junkets.

It might take a while to exit the FATF grey list but least there is progress and now a political will to get things done. Exiting the grey list will open up the country to more investments and get a lower risk rating from international business communities. This is turn will also benefit the land based and online gaming industry but having better transparency in how its finances and regulations are being implemented.

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