Int’l body wants more teeth in PH anti-money laundering law

MANILA, Philippines—The international Financial Action Task Force (FATF) wants the Philippines to amend anew its recently enhanced law against money laundering, insisting that casinos be included on the list of entities required to report suspicious transactions to regulators.

FATF, which concluded plenary meetings in Paris on Friday, said in a statement posted on its Web site that it decided to keep the Philippines on the list of countries that have manifested significant progress in fighting money laundering but away from its blacklist.

However, the influential body said the Philippines still has to address the particular “deficiency” in the new law if it wants to be declared as a country that is fully cooperative in the global fight against money laundering and terrorist financing.

“The FATF has concerns that the casino sector in the Philippines continues to be unregulated for AML (anti-money laundering) and CFT (countering the financing of terrorism) purposes and is still not subject to AML/CFT requirements, and urges the Philippines to promptly and effectively address this outstanding deficiency,” FATF said.

On February 15, President Benigno Aquino signed into law a bill passed by Congress  putting more teeth to the country’s Anti-Money Laundering law. The amended legislation requires even money changers, dealers of jewelry and precious metals, real-estate companies, and pre-need firms to report to the Anti-Money Laundering Council (AMLC) suspicious transactions for purposes of catching money laundering and terrorist financing activities.

Previously, only banks, other financial institutions, and some professionals, were required to report such transactions to the AMLC.

Despite earlier recommendations to include casinos, the Philippine Congress ended up excluding these entities from those required to report suspicious transactions because of concerns from lobbyists that the inclusion could discourage people from going to casinos.

FATF, however, said including casinos in the reporting requirement is crucial for having a truly progressive anti-money laundering and anti-terrorist financing environment.

FATF said it will soon send representatives to the Philippines to confirm that the reforms that the country has committed to adopt are indeed being undertaken, and to determine progress as far as compliance with the remaining requirement involving casinos is concerned.

“The FATF will conduct an on-site visit to confirm that the process of implementing the required reforms and actions underway to address deficiencies previously identified by the FATF,” the statement added.

At the just concluded plenary meetings, FATF decided against placing the Philippines on its blacklist of uncooperative countries as it recognized the country’s efforts to comply with majority of its requirements.

Among these requirements are the criminalization of money laundering and terrorist financing, the adoption of procedures for freezing of assets believed to have come from terrorist activities and other illegitimate sources, and implementation of tighter rules on financial transparency.

“Since October 2010… the Philippines has made significant progress to improve its AML/CFT regime and has largely addressed its action plan,” FATF said.

It noted, however, that the Philippines, together with several other countries, will continue to be monitored for their progress toward becoming fully compliant with all of the FATF’s requirements.

The Philippines’ AMLC has said compliance with the FATF’s requirements is necessary to avoid the serious repercussions of having the country downgraded to the black list.

Blacklisting by the FATF could mean tighter requirements imposed on nationals of a country when they engage in financial transactions. Such a consequence is seen to adversely affect sending of remittances by the over 10 million estimated overseas Filipino workers.