By Luisa Maria Jacinta C. Jocson, Reporter
THE PHILIPPINES has made headway in its bid to exit the Financial Motion Task Force’s (FATF) “gray list” by next yr because it has “substantially accomplished” its remaining motion items.
“Yes, I believe we passed a vital step,” Bangko Sentral ng Pilipinas (BSP) Governor Eli M. Remolona, Jr. said in a text message.
This after the FATF kept the Philippines in its list of jurisdictions under increased monitoring for “dirty money” risks in its October plenary.
The Philippines has now been on the grey list for over three years or since June 2021.
Nevertheless, the FATF said the country has addressed the remaining deficiencies within the really helpful motion items to enhance its anti-money laundering and counter financing of terrorism (AML/CFT) regime.
“We’re very glad to report and for me to share with you that this week the plenary examined the progress of the Philippines and consider that the Philippines has indeed substantially accomplished this motion plan,” FATF President Elisa de Anda Madrazo said at a press conference late on Friday.
The FATF will conduct an on-site visit to confirm this progress, which is about to happen anytime between now and February 2025.
“An on-site visit implies that a gaggle of experts go into the country to confirm the progress that it has made in order that the FATF can resolve whether to remove it from the grey list or not. We are going to expect a solution on this in February of 2025,” she added.
The on-site assessment may also “confirm if the implementation of AML/CFT reforms has begun and is being sustained, and that the essential political commitment stays in place to sustain implementation in the long run,” the FATF said on its website.
The Anti-Money Laundering Council (AMLC) in a press release said the country is now “closer to exiting the anti-money laundering watchlists by 2025.”
This might pave the best way for Filipinos, particularly overseas employees, to “profit from faster and cheaper remittances and other transactions,” it added.
“Failure to handle the remaining motion plan items would have put the Philippines susceptible to entering the blacklist,” the AMLC said.
“FATF member countries impose restrictions and extra checks, and possibly refusal of monetary transactions with countries within the blacklist. This ends in failed transactions, delays, and costs which may be passed on to the consumers,” it added.
AMLC said that the FATF’s Asia-Pacific Joint Group will visit the country early next yr to “confirm the sustainability of the AML/CTF reforms.”
“That is the ultimate step toward the country’s removal from the grey list,” it added.
The FATF last week said the Philippines has implemented key reforms comparable to “demonstrating that risk-based supervision of Designated Non-Financial Businesses and Professions (DNFBPs) is going on; demonstrating that supervisors are using AML/CFT controls to mitigate risks related to casino junkets; implementing the brand new registration requirements for Money or Value Transfer Services (MVTS) and applying sanctions to unregistered and illegal remittance operators.”
In July, Malacañang issued an executive order mandating all government offices to adopt the National Anti-Money Laundering, Counter-Terrorism Financing, and Counter-Proliferation Financing Strategy 2023-2027.
The FATF also noted the country’s reforms focused on streamlining law enforcement agencies’ access to helpful ownership information and increasing variety of money laundering investigations and prosecutions.
FATF’s Ms. Madrazo said that the Philippines is an “example of the positive impact that this process can have in a rustic.”
“With billions of dollars flowing into the country annually and the sheer volume of cross-border transactions, the progress made by the Philippines could have a big impact in the safety of the international economic system,” she added
Meanwhile, analysts said the country is well on its technique to exiting the grey list, but continued implementation of reforms remains to be needed.
“There may be a great possibility to exit from the list if a transparent warning and data dissemination of the must be compliant to ‘entities with potential’ violations of FATF are done. Continuous monitoring of those entities should be done,” Antonio A. Ligon, a law and business professor at De La Salle University in Manila, said in a Viber message.
However, Chester B. Cabalza, founding president of International Security and Development Center, said that the on-site visit remains to be a “reaffirmation that the country remains to be dangerous for dirty money that should be cleansed.”
“Transparency in our financial records and robust coordination for line government agencies are needed to handle this discrepancy,” he said. “The Philippines has to get out from the grey list to turn out to be more productive and return to a healthy financial environment within the region.”
Leonardo A. Lanzona, an economics professor on the Ateneo de Manila University, said it can be crucial to handle poverty and corruption if it wishes to resolve dirty money risks.
“While the federal government is setting the institutional requirements in moving out of the grey list, the overriding condition that keeps the country within the list stays. This pertains to poverty which shouldn’t be a direct requirement within the list but can not directly influence the required aspects in moving out of the list,” he said in an e-mail.
Mr. Lanzona said poverty contributes to informality and “breeds unregulated transactions and corrupt financial networks that should not allowed by FATF.”
