Date: 09.07.2024

by Sebastian Warowny

Philippines Aims for 2025 Exit from FATF Grey List

The Philippines is working diligently towards exiting the Financial Action Task Force (FATF) grey list, but a complete exit by October remains unlikely. According to Eli Remolona, chairman of the Central Bank of the Philippines and head of the Anti-Money Laundering Council (AMLC), the country might achieve this goal by January next year.

Current Status and Challenges

The FATF added the Philippines to its grey list in June 2021, citing 18 deficiencies in its efforts to combat money laundering (AML), counter the financing of terrorism (CFT), and prevent proliferation financing (PF) related to chemical, nuclear, and biological weapons. One critical issue highlighted was the need for the country to demonstrate that supervisors are using AML/CFT controls effectively to mitigate risks associated with casino junkets.

Government Actions and Progress

Eli Remolona stated that the government has been tightening its monitoring of casino junkets, with the Philippine Amusement and Gaming Corp working actively on this matter. He emphasized significant progress, noting, “We’ve officially fulfilled 15 of the 18 [items of concern].”

In a February update, the Anti-Money Laundering Council reported that President Ferdinand Marcos, Jr. had instructed all relevant government agencies to complete their respective tasks within this year to ensure the country’s removal from the grey list. These tasks are part of the government’s National Anti-Money Laundering, Counter-Terrorism Financing, and Counter-Proliferation Financing Strategy 2023-2027.

Impact of Grey Listing

Jurisdictions on the FATF grey list face increased scrutiny. A research paper by the International Monetary Fund highlighted that such measures can disrupt capital flows. Following a June 28 plenary meeting, the FATF decided to keep the Philippines on its watch list, urging the country to address remaining issues promptly, as all deadlines expired in January 2023.

Data from Moody’s Analytics Inc., cited by BusinessWorld Online, revealed that from 2018 to 2023, the Philippines ranked among the top five countries in Southeast Asia for money laundering activity. The number of reported money laundering incidents in the Philippines increased by 45% from 2022 to 2023.