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Metro Manila (CNN Philippines, November 20) – The Philippines may be months away from returning to a global watch list of states with weak rules to protect themselves from dirty money, which would make remittances and international transactions more expensive.
Bangko Sentral ng Pilipinas Governor Benjamin Diokno warned on Friday that the Philippines could fall back on the global “gray list” of nations with loopholes in local regulations on money laundering and terrorist financing (AML-CTF) .
Diokno said that the country’s reputation with the Financial Action Task Force (FATF), a global watchdog that protects against ill-gotten money and criminal proceeds, would suffer if Congress does not pass a law updating the Law against the money laundering of 2001.
“In a recent assessment of the Philippines, the FATF saw loopholes in the country’s laws and regulations on money laundering and terrorist financing,” Diokno said during his GBED Talks media forum on Friday. “If any of the proposed amendments are not approved and implemented by February 2021, the Philippines will be included in the gray list of the FATF International Cooperation Review Group.”
“This will publicly identify the Philippines as a jurisdiction with strategic deficiencies in its AML-CTF regime that presents a risk to the international financial system,” he added.
Senate Bill 1412 and House Bill 6174 seek to further toughen the rules by imposing “targeted financial penalties” on entities that evade anti-money laundering safeguards, such as rapid asset freezes, and explicitly prohibit the financing of the distribution of weapons of mass destruction. Real estate developers and intermediaries must also inform regulators about the purchase and sale of properties.
READ: Criminals use real estate transactions in PH to launder dirty money
The Philippines went off the gray list in 2017 after global regulators saw progress in pushing for local safeguards against dirty money or any cash or wealth obtained through illegal channels. A big change then was the placement of physical and Internet-based casino operators under the command of the Anti-Money Laundering Council or AMLC, following the $ 81 million Bangladesh Bank heist, which saw the money trail disappear. of funds stolen from the central bank of Dhaka. at the gambling tables in Manila.
Going back to the gray list will merit higher costs for transactions with Philippine banks and other institutions, aimed at offsetting the increased risk of money laundering. This is one level above the black list, which are called “high risk” and “uncooperative” states like North Korea and Iran.
Earlier this year, the AMLC also lobbied for the controversial Anti-Terrorism Law to be passed, saying it also covered the gaps that previously allowed terrorist organizations to send, receive, or “clean” money to seed conflict here.
Diokno said he remains “optimistic” that the measures will be approved in time with Malacañang’s push, as they have been certified as urgent by President Rodrigo Duterte.
The Senate is still wrapping up plenary debates on the 2021 national budget, and the AMLC-backed bill is still pending at the committee level. A counterpart measure in the House is still under scrutiny for passage at second reading.
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