The Philippines’ Anti-Money Laundering Council (AMLC) has reported a decline in money laundering activities following the announcement of a ban on Philippine offshore gaming operators (POGOs).
The ban, announced by President Ferdinand Marcos Jr., is being implemented in response to concerns over the sector’s vulnerability to illicit activities.
In an official statement cited by local media outlet Business World, the AMLC emphasized the high risk associated with the POGO sector, describing it as “highly vulnerable” to money laundering due to its internet-based nature.
A risk assessment conducted by the council in March 2020 highlighted these vulnerabilities, leading to the conclusion that a comprehensive ban on POGOs could mitigate these risks. The council expressed optimism that this ban would decrease the prevalence of money laundering within the gaming industry.
The Philippines has been identified as one of the top five countries in Southeast Asia which experienced a significant increase in money laundering activities between 2018 and 2023.
According to data from Moody’s, money laundering incidents in the country surged by 45 percent from 2022 to 2023. The AMLC’s recent efforts to curb these activities through the POGO ban mark a critical step in addressing this trend.
While the POGO ban is expected to reduce money laundering risks, the AMLC clarified that the remaining concerns highlighted by the Financial Action Task Force (FATF) are unrelated to POGOs. Instead, these concerns focus on mitigating risks associated with junket operations in casinos. Junkets, often involving high rollers who travel to casinos for gambling, have been identified as another potential avenue for money laundering.
The FATF, which has kept the Philippines on its “grey list” of jurisdictions under increased monitoring for money laundering risks for three consecutive years, noted that the country has addressed 15 out of its 18 recommended action items. However, one of the remaining items involves demonstrating that anti-money laundering and counter-financing of terrorism (AML/CFT) controls are effectively mitigating risks within casino junket operations.
To further combat money laundering, the AMLC underscored the importance of implementing stringent AML/CFT controls in the gaming sector. These measures include fit and proper tests on junket operators, enhanced customer due diligence, and regular monitoring of transactions related to junket operations.
The council also urged gaming regulators to enhance their compliance and enforcement efforts to ensure robust anti-money laundering practices.
