Anti-Money Laundering (AML) in the Philippines

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

The Philippines employs sophisticated anti-money laundering (AML) methods to combat financial crimes. The country's dedication to financial integrity is demonstrated by its compliance with international AML requirements. The Philippines' AML system highly focuses on rigorous client due diligence, constant surveillance of financial transactions, and financial institutions' prompt reporting of suspected activities. These comprehensive actions reflect the country's willingness to combat money laundering effectively.  

Overview of AML in the Philippines  

Money laundering is a severe problem in the Philippines. Illegal drug trafficking in the Philippines has expanded into a billion-dollar industry recently. 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. Increased risk is also associated with recent developments in the online gaming industry. Corruption and sex trafficking are two of the most common ways for criminals to make money.  

Since June 2021, when the Philippines made a high-level political commitment to work with the FATF and APG to strengthen the effectiveness of its AML/CFT regime, the Philippines has taken steps to increase the use of financial intelligence and investigative skills of LEAs tasked with ML investigations and to prioritize asset tracking and confiscation at the point of conviction in criminal cases. The FATF strongly advises the Philippines to implement its action plan to remedy the strategic shortcomings as soon as feasible, as all deadlines expire in January 2023. 

Philippines failed to resolve strategic inadequacies in countering money laundering, terrorist, and proliferation financing

AML 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 AML policy. The government took further steps 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 investigate and prosecute terrorism financing and freeze assets potentially linked to money laundering or terrorism in addition to its usual FIU obligations. This act was updated in 2013.  

AML Regulators of the Philippines

The AMLC is the Philippines' central AML/CTF authority. Consequently, it serves as the Philippines' AML/CTF administrator and manager, financial intelligence department, and primary AML 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)  

  • It helps to safeguard and maintain the dignity of the Philippine financial system, including bank account security.  
  • It prevents the Philippines from being used as a money-laundering base for the profits of illegal activities.  
  • It expands 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)  

  • It aims 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.  
  • It accepts and complies 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.  
  • It aims 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.  

AML Solutions for the Philippines  

AML regulations in the Philippines play a pivotal role in safeguarding the integrity of the nation's financial system. These regulations are designed to combat money laundering activities that can harm the country's economy and security. In the Philippines, entities obligated to adhere to AML regulations can rely on Sanction Scanner's advanced AI-driven AML solutions. We provide tailored tools to help organizations effectively mitigate financial crime risks. You can contact us or request a demo to combat financial crimes in the Philippines.  

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