MANILA, Philippines – Global money laundering and terror financing watchdog Financial Action Task Force (FATF) has removed the Philippines from its “gray list,” a move that will significantly help overseas Filipinos, including tourists, in their financial transactions as it will reduce international fund transfer requirements.
During its second plenary on Friday, February 21, the Paris-based FATF said it has “removed the Philippines from its increased monitoring following a successful on-site visit.”
In a statement following the FATF’s decision, the Philippine government said that during the on-site visit from January 20 to 22, 2025, it “successfully demonstrated compliance with its action plan” which included:
- Strengthening supervision of designated non-financial businesses, such as lawyers, accountants, real-estate sector and company service providers, and casinos
- Reducing risks associated with casino junkets
- Cracking down on unregistered and illegal money transfer operators
- Improving access to accurate beneficial ownership information for law enforcement agencies
- Increasing investigations and prosecutions related to money laundering and terrorism financing
- Implementing appropriate measures for non-profit organizations to prevent misuse while allowing legitimate activities
- Implementing stricter cross-border measures on all main sea/airports of the country
“The FATF Plenary congratulated the Philippines for the positive progress in addressing the strategic anti-money laundering and countering the financing of terrorism and proliferation financing (AML/CFT/CPF) deficiencies previously identified during their mutual evaluations. The Philippines has completed their Action Plan to resolve the identified strategic deficiencies within agreed timeframes and will no longer be subject to the FATF’s increased monitoring process,” the FATF said in a statement.
The Philippine government called the development “a milestone that underscores the country’s commitment to combat money laundering and terrorist financing.”
It said being on the list of countries under increased monitoring had been a “burdensome process for banks and other financial institutions” as it “discourages correspondent banking relationships and international flows into the country.”
“The Philippines’ exit from the FATF greylist is expected to facilitate faster and lower-cost cross-border transactions, reduce compliance barriers, and enhance financial transparency. These will support business, strengthen the country’s position as an attractive destination for foreign direct investment (FDI), and benefit Filipinos, particularly overseas Filipino workers (OFWs),” the government said in the statement released by the Presidential Communications Office early Saturday, February 22.
“The exit will reduce international fund transfer requirements, benefitting Filipino individuals and businesses,” it added.
There are over 10.7 million Filipinos overseas mostly in North America, the Asia-Pacific, and the Middle East. They remitted a record high of $38.34 billion in 2024, 3% more than the $37.21 billion in 2023. Some of them are not entertained by a number of financial institutions due to the risks involved in dealing with customers from countries on the gray list.
The FATF had again placed the Philippines on the gray list in 2021, and required it to address 18 action items. The country had to be closely monitored by the FATF and had to implement “corrective measures to avoid being placed on the blacklist.” [READ: Philippines lands on global dirty money watchdog’s gray list again]
The government said that even before the Philippines was placed on the gray list, “some foreign regulators were already imposing stringent requirements or fines on financial institutions dealing with entities in the Philippines and other countries deemed to have weak anti-dirty money regimes.”
“This prompted some banks to just avoid doing business with entities in those countries rather than managing possible money laundering or terrorist financing risks,” the government said.
The Philippines’ removal from the grey list “may prompt foreign banks to review and resume their business relationship and transactions with Philippine financial entities.”
Executive Secretary Lucas Bersamin, chairman of the National Anti-Money Laundering/Counter-Terrorism Financing/Counter-Proliferation Financing Coordinating Committee (NACC), said the FATF’s decision “affirms that the Philippines’ AML/CTF/CPF framework aligns with global standards,” and “supports our vision to enhance economic competitiveness for the benefit of our people.”
Bangko Sentral ng Pilipinas Governor and Anti-Money Laundering Council (AMLC) Chairman Eli Remolona Jr. said the achievement was the result of “strong cooperation within the government as well as the private sector,” and “also complements our ongoing efforts to make the financial system a stronger driver of sustainable growth.”
“The private sector — including banks, money service businesses, real estate firms, casinos, legal and accounting professionals, and non-profit organizations — and the Judiciary also played a crucial role in achieving this milestone,” the government said.
The FATF urged the Philippines to continue working with the Asia/Pacific Group on Money Laundering “to sustain its improvements in its AML/CFT system.
“The FATF encourages the Philippines to continue its work in ensuring that its CFT [combating the financing of terrorism] measures are appropriately applied, particularly the identification and prosecution of TF [terrorist financing] cases, and are neither discouraging nor disrupting legitimate NPO [non-profit organization] activity,” it said.
The latest FATF plenary, under the presidency of Elisa de Anda Madrazo of Mexico, was held February 19 to 21 in Paris, France. – Rappler.com