Philippines seen staying in dirty money gray list

MANILA, Philippines — The Philippines is likely to be retained in the gray list or jurisdictions under increased monitoring of global dirty money watchdog Financial Action Task Force (FATF), as the country has yet to prove that it has addressed strategic deficiencies in its regimes to counter money laundering, terrorist financing and proliferation financing.

In a forum hosted by the Tuesday Club at the EDSA Shangri-La Hotel, Bangko Sentral ng Pilipinas Governor and Anti-Money Laundering Council chairman Felipe Medalla said the Philippines has until January next year  to prove that it can enforce measures to counter money laundering and terrorist financing.

“We have clearly missed the first deadline. The first deadline was this January. We are now given a year, until January 2024,” Medalla said.

After it was included in the gray list anew in June 2021, the Philippines has worked vigorously to address the deficiencies to meet the January 2023 deadline set by the FATF.

The FATF wants the Philippines to enhance and streamline law enforcement agencies’ access to beneficial ownership information and take steps to ensure that the information is accurate and up-to-date.

The Philippines, the watchdog said, should also demonstrate an increase in the use of financial intelligence and an increase in money laundering investigations and prosecutions in line with risk.

The Philippines should also demonstrate an increase in the identification, investigation and prosecution of terrorism financing cases, as well as enhance the effectiveness of the targeted financial sanctions framework for both terrorism financing and proliferation financing by demonstrating that designated non-financial businesses and professions understand their obligations.

Medalla said the Philippines needs to show a higher number of prosecutions and convictions.

Medalla said that he met with Justice Secretary Jesus Crispin Remulla for the faster prosecution and conviction of violators of Republic Act 9160 or the Anti-Money Laundering Act (AMLA), as amended.

“We had a meeting with the Department of Justice and they said that if we’re only more diligent in having a system that truly brings out all the real prosecution and conviction, the numbers will be much higher,” Medalla said.

He reiterated that the solution requires a whole of government approach.

The Philippines was included in the black list of the FATF in June 2000 but was removed from the list in February 2005 after the passage of Republic Act 9180 or the Anti-Money Laundering Act (AMLA) of 2001 followed by the creation of the Anti-Money Laundering Council (AMLC) via RA 9194 in 2003.

Since then the Philippines has been in and out of the gray list until it was reincluded in the list of jurisdictions under increased monitoring in June 2021 despite the enactment of RA 11479 or the Anti-Terrorism Act of 2020 as well as RA 11521 that amended the AMLA.

The International Monetary Fund earlier stressed the need for the Philippines to address the deficiencies cited by the FATF to help encourage foreign direct investment inflow into the country.