The Philippines’ efforts to exit the Financial Action Task Force (FATF) grey list were unsuccessful in the organization’s most recent plenary session, held from October 21st to 25th in Paris, France.
This session marked the first under the FATF presidency of Elisa de Anda Madrazo from Mexico.
According to a statement released by the FATF, after being placed on the grey list in June 2021, the Philippines made a high-level political commitment to work with the FATF and the Asia/Pacific Group on Money Laundering (APG) to enhance the effectiveness of its anti-money laundering and counter-terrorism financing (AML/CFT) framework.
The FATF noted that, during its October 2024 plenary, the Philippines has substantially furthered its action plan, warranting an on-site assessment to verify the ongoing implementation of AML/CFT reforms and the continued political commitment to sustain these improvements.
The Philippines’ key reforms include several actions to strengthen its AML/CFT regime:
- Establishing risk-based supervision for designated non-financial businesses and professions (DNFBPs);
- Demonstrating the application of AML/CFT controls to manage risks in casino junkets;
- Implementing new registration requirements for money or value transfer services (MVTS) and imposing sanctions on unregistered remittance operators;
- Improving law enforcement access to beneficial ownership (BO) information and ensuring its accuracy and currency;
- Increasing the use of financial intelligence and enhancing money laundering investigations and prosecutions in line with identified risks;
- Identifying, investigating, and prosecuting terrorism financing cases more effectively;
- Implementing appropriate measures within the non-profit organization (NPO) sector, ensuring that these do not disrupt legitimate NPO activities;
- Enhancing the targeted financial sanctions framework for both terrorism financing and proliferation financing.
The FATF emphasized that jurisdictions under increased monitoring, such as the Philippines, are actively collaborating with the organization to address strategic deficiencies in combating money laundering, terrorist financing, and proliferation financing.
The October review saw Algeria, Angola, Côte d’Ivoire, and Lebanon added to the grey list, while Senegal was removed. Meanwhile, the FATF’s “black list” continues to include North Korea, Iran, and Myanmar.
Expected to exit grey list by 2025
After the FATF made an initial determination that the Philippines has significantly completed its action plan, the organization announced that an on-site assessment will take place to verify the progress of AML/CFT reforms in the country and to ensure that the necessary political commitment is maintained for ongoing implementation.
In a related announcement, the Philippines’ Anti-Money Laundering Council (AMLC) indicated that the FATF’s Asia/Pacific Joint Group (APJG) is scheduled to visit the Philippines early next year, marking the final step toward the country’s removal from the grey list.
According to the Philippine News Agency, Executive Secretary Lucas Bersamin emphasized the government’s ongoing efforts to implement and sustain these reforms, noting that a robust AML/CTF regime is essential for protecting the nation’s financial system and economy from illicit activities.
He stated that this achievement reflects the hard work and coordination among various government agencies and demonstrates the country’s strong commitment to meeting the FATF’s stringent standards, ensuring the long-term protection of its financial system. Bersamin expressed confidence that this progress will be validated during the upcoming on-site visit.
