Anti-Money Laundering (AML) in the Philippines

AML Country Guide / Anti-Money Laundering (AML) in the Philippines

Money laundering is a severe problem in the Philippines. Illegal drug trafficking in the Philippines has officially expanded into a billion-dollar industry in recent years. Financial organized illegal activity from China, Hong Kong, and Taiwan keeps increasing in the Philippines. According to reports, drugs and weapons trafficking and money laundering through suspected links to organized crime are used to finance terrorist organizations fighting in the Philippines. The profits of government officials' illegal practices are also the origins of laundered funds. Credit cards are used in most drug transactions that pass through the Philippines.

Overview of AML in the Philippines

Because of its rising economy and strategic position along major trafficking routes, the Philippines is particularly vulnerable to money laundering and terrorism funding. Increased risk is also associated with recent development in the online gaming industry. Corruption and sex trafficking are two of the most common ways for criminals to make money. Kidnapping for money, cocaine, and arms trafficking are sources of income for terrorist groups operating in the Philippines. Furthermore, the vast number of money transfers from Filipinos living abroad adds to the AML authorities' tracking responsibility.

Banking in the Philippines

The national bank of the Philippines is the Bangko Sentral ng Pilipinas (BSP). The Central Bank's primary goal is to preserve market stability to promote steady and long-term economic development. The BSP also seeks to foster and maintain monetary stability as well as the national currency's convertibility. The Central Bank is the exclusive body and force in charge of issuing the national currency.

Anti-Money Laundering Laws in the Philippines

The Anti-Money Laundering Council (AMLC) is a Philippine government organization charged with enforcing the regulations of the Republic Act, also known as the "Anti-Money Laundering Act of 2001." (AMLA). This act made money laundering illegal and required financial institutions controlled by the Central Bank to comply with detection, recordkeeping, and reporting requirements. Despite the difficulties, the Philippine government is strengthening its anti-money laundering (AML) policy. The government took further steps in 2019 to improve its FIU and interagency cooperation.

The Philippines should consider new efforts to improve interagency coordination by boosting its financial investigations and criminal convictions. The Council will participate in the investigation and prosecution of terrorism financing, as well as freeze assets potentially linked to money laundering or terrorism, in addition to its usual FIU obligations. This act was updated in 2013.

Anti Money Laundering Regulators in The Philippines

The Anti-Money Laundering/Counter-Terrorism Financing Commission (AMLC) is the Philippines' central anti-money laundering/counter-terrorism financing (AML/CTF) authority. Consequently, it serves as the Philippines' AML/CTF administrator and manager, financial intelligence department, and primary anti-money laundering and anti-terrorist funding law enforcement organization.

According to the following State laws, the AMLC is responsible for implementing the AMLA and TFPSA:

 Anti-Money Laundering Act of 2001 (AMLA)

  • To safeguard and maintain the dignity of the Philippine financial system, including bank account security.
  • To prevent the Philippines from being used as a money-laundering base for the profits of illegal activities.
  • To expand participation in global criminal investigations of individuals engaging in money laundering operations where they are conducted according to Philippine foreign policy.

 Terrorism Financing Prevention and Suppression Act of 2012 (TFPSA)

  • To preserve life, freedom, and properties from acts of terrorism and condemn terrorism and those who aid and finance it; to consider terrorism as openly hostile and harmful to national security and the welfare of the community; and to make terrorism funding a crime against the Filipino people, civilization, and international law.
  • To accept and comply with international obligations to fight terrorism financing, including the International Convention for the Suppression of Terrorist Financing and other formal United Nations Security Council terrorism-related measures.
  • To strengthen the fight against terrorism by blocking and eliminating the occurrence of such offenses through the freezing and theft of property or funds while maintaining human rights protections.

Organizations obliged to comply with AML laws in the Philippines can easily comply with regulations and minimize their risks with Sanction Scanner's AML solutions such as PEP, Sanction, Watchlist Screening, and AML Transaction Monitoring. Request a demo to easily integrate Sanction Scanner into your business in one day through to its powerful API.

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