Remolona: PH will leave the ‘grey’ list in February 2025

The Philippines is expected to leave the global dirty money watchlist in February after a watchdog found the country acted on previously identified shortcomings, Bangko Sentral ng Pilipinas (BSP) Governor Eli Remolona Jr. said.

“This is a very important step for us,” Remolona told The Manila Times in a text message.

The Paris-based Financial Action Task Force (FATF) said late on Friday that the Philippines – which has been on the ‘grey’ list of jurisdictions under enhanced surveillance since 2021 – has “substantially completed its action plan” to improve the effectiveness of its policies strengthen. anti-money laundering and countering the financing of terrorism (AML/CFT) systems.

An on-site assessment will now follow to “verify that AML/CFT implementation has begun and is continuing and that the necessary political commitment remains in place to support implementation in the future.”

When asked when the Philippines might be removed from the gray list, Remolona said “February.”

FATF President Elisa de Anda Madrazo told reporters on Friday that the on-site assessment would involve a team of experts and that “we will expect an answer on… (whether the country will leave the list) in February 2025.”

The FATF said in its latest assessment that the Philippines has implemented important reforms, including:

– demonstrating risk-based supervision of designated non-financial businesses and professions (DNFBPs, including casinos, brokerage houses and casinos);

– demonstrate that regulators are using AML/CFT controls to mitigate the risks associated with casino junkets;

– implementing the new registration requirements for money or value transfer services and imposing sanctions on unregistered and illegal money transfer companies;

– improving and streamlining law enforcement authorities’ access to beneficial ownership (BO) information, and taking steps to ensure that BO information is accurate and up to date;

– demonstrating an increase in the use of financial intelligence and an increase in money laundering investigations and prosecutions commensurate with the risks;

– demonstrating an increase in the identification, investigation and prosecution of terrorist financing cases;

– demonstrating that appropriate measures are being taken against the non-profit organizations (NPOs) sector (including unregistered ones) without disrupting legitimate activities; And

– increasing the effectiveness of the targeted financial sanctions framework for the financing of both terrorism and proliferation.

When the watchdog kept the Philippines on the gray list for the third consecutive year at its previous meeting in June, it told the country to “implement its action plan quickly” as “all deadlines had passed by 2023.”

In January this year, President Ferdinand Marcos Jr. instructed all relevant agencies to work towards securing an exit in October.

Executive Secretary Lucas Bersamin, who is also chairman of the National Coordination Committee on Anti-Money Laundering and Combating the Financing of Terrorism/Terrorism Financing, said the government is confident that the progress made “during the visit will be confirmed on site”.

“We must continue our efforts to ensure that our reforms are implemented and sustained. Building a resilient AML/CTF (counter-terrorist financing) regime is critical to protect our financial system and economy from illicit activities,” he added.

Inclusion on the gray list means increased FATF oversight and a commitment to promptly resolve identified deficiencies. It is a step forward compared to the blacklisting, which happened to the Philippines in 2000 and led to economic sanctions.

The country only left the “black” list in 2005, following the passage of the 2001 Anti-Money Laundering Act and a subsequent 2003 amendment.

It was placed on the “grey” list in 2010; however, due to the lack of terrorist financing laws and was downgraded to the “dark gray” list in February 2012.

It was later upgraded to the “grey” list in June of that year and was eventually abandoned in 2013 with the passage of the Terrorism Financing Prevention and Suppression Act of 2012.

However, it remained on a watchlist until 2017, when the Casino Act was passed, and after a review in 2018, it was placed back on the “grey” list in 2021.

The FATF currently classifies North Korea, Myanmar and Iran as ‘high-risk jurisdictions with a call to action’, also known as the blacklist.

The category of “jurisdictions under enhanced surveillance” – the gray list – includes Algeria, Angola, Bulgaria, Burkina Faso, Cameroon, Ivory Coast, Croatia, Congo, Haiti, Kenya, Lebanon, Mali, Monaco, Mozambique, Namibia, Nigeria, the Philippines, South Africa, South Sudan, Syria, Tanzania, Venezuela, Vietnam and Yemen.

Senegal was removed from the gray list last Friday, while Algeria, Angola, Ivory Coast and Lebanon were added.