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The Anti-Money Laundering Council (AMLC) is pushing for more strict due diligence measures on delinquent firms in the Philippines.
After failing to prevent financial crimes and money laundering, the Philippines was put on the Financial Action Task Force’s (FATF) gray list in 2021. Since the country has been trying to improve its financial ecosystem and process to get off the gray list, the Anti-Money Laundering Council (AMLC) has advised the entities in the Philippines to strengthen their security measures, which will ultimately reduce the rate of financial crime and illegal activities.
Bangko Sentral ng Pilipinas’ (BSP) Governor Eli M. Remolona Jr. said, “By February 2024, we will know whether we stay on the list or leave the list entirely, which is what we want,” said Remolona. He added that “there might be a chance that we will go on to the blacklist, but that’s very unlikely. We’re doing everything we can to show that we’re making progress (to get out of the gray list),”
The Anti-Money Laundering Council (AMLC) specifically asked the targeted institutions to improve their “customer due diligence” on their clients and customers. The covered entities include banks, financial institutions, and digital FinTech providers. As per Republic Act 9160, also known as the Anti-Money Laundering Act (AMLA), these institutions must verify their corporate clients and customers. These institutions must verify their clients’ General Information Sheet (GSI) for the due diligence process.
In a report released on October 27th, 2023, the FATF said it “urges the Philippines to swiftly implement its action plan to address the strategic deficiencies as soon as possible, as all deadlines expired in January 2023.” The Philippines was given a one-year extension from January 2023 to January 2024 to improve. This time was given to the country to improve its compliance with the required Anti Money Laundering (AML) and Counter-Terrorist Financing (CTF) measures.
The Securities and Exchange Commission (SEC) also released lists that included non-user corporations and non-compliant organizations eligible for amnesty. RA 11232, the Revised Corporation Code of the Philippines, mandates that companies submit annual financial statements and GIS in order to qualify for the SEC Amnesty Program.
This list includes around 298,335 corporations that could be potentially marked as non-compliant if they fail to submit their GIS three times in a row consecutively within five years.