The Securities and Exchange Commission (SEC) says it is dedicated to sustaining its reforms to get the Philippines off the Financial Action Task Force (FATF) ‘grey list’.
This commitment follows the FATF 2024 plenary, where the organization confirmed that, although the Philippines remains on the grey list, the country has substantially completed its action plan, consisting of 18 items that have led to increased monitoring since June 2021.
According to the Manila Bulletin, the SEC emphasized that failure to address the remaining action plan items could jeopardize the Philippines’ status, potentially leading to a blacklist designation.
In evaluating the Philippines’ progress, the FATF noted reforms that improve law enforcement agencies’ access to beneficial ownership information, ensuring its accuracy and timeliness, as well as the appropriate treatment of non-profit organizations without disrupting legitimate activities.
The SEC reported its role in implementing key reforms for risk-based supervision of designated non-financial businesses and professions (DNFBPs). Additionally, the FATF recognized an increase in the use of financial intelligence and a rise in money laundering investigations and prosecutions, along with enhanced identification and prosecution of terrorism financing cases.
The SEC has mandated the declaration of beneficial ownership in the General Information Sheets of all corporations, making this information accessible to law enforcement agencies, including the Philippine National Police and the Bureau of Internal Revenue.
In 2021, the SEC prohibited the issuance and sale of bearer shares to promote transparency and prevent the misuse of corporations for illicit purposes.
In the future, the SEC is committed to sustaining its AML/CFT reforms through enhanced supervision, continuous audits, and the integration of beneficial ownership registry initiatives into its strategic plan for 2023 to 2028.
These efforts reflect the SEC’s long-term dedication to safeguarding the financial system against illicit activities while supporting the Philippines’ aim for a complete exit from the FATF grey list.
Countries on the FATF grey list face restrictions and additional scrutiny, resulting in transaction failures, delays, and costs that ultimately affect consumers.
Following its assessment of the Philippines’ compliance, the FATF Asia/Pacific Joint Group plans to conduct an on-site visit early next year. This visit aims to verify the implementation of anti-money laundering and combating the financing of terrorism (AML/CFT) reforms and to ensure they are both underway and sustainable, with ongoing political commitment to these efforts.
SEC Chairperson Emilio B. Aquino highlighted this milestone as a testament to the Philippines’ commitment to combating money laundering and terrorism financing through essential reforms that align with global standards.
The SEC plans to continue investing in digital initiatives and optimizing resources to ensure the long-term viability of these reforms. It also aims to uphold transparency and compliance while collaborating with local and international partners to enhance AML/CFT measures.
