The country still faces a real risk of being placed back on the Financial Action Task Force (FATF) gray list, as Bangko Sentral ng Pilipinas Governor Eli Remolona Jr. acknowledged that vulnerabilities remain, particularly given our historical exposure to money laundering risks, even after its removal from the FATF gray list in 2025.
“To be honest, we have a risk. We have a risk that we will return to the gray list, although we are doing what we can to prevent that,” Remolona said in response to questions on whether recent governance issues could raise red flags for global watchdogs.
The BSP chief stressed that safeguarding the country’s standing with the FATF would require sustained effort over several years, not just short-term fixes. He noted that the next formal round of FATF evaluation for the Philippines is expected around 2027.
He added that regulators and enforcement agencies must consistently demonstrate that reforms are being implemented on the ground, not merely written into policy.
When asked whether the ongoing probe into the flood control corruption scandal could affect the country’s risk profile, he underscored that governance, enforcement, and the credibility of institutions are closely watched by international bodies.
Philippine Institute for Development Studies senior research fellow John Paolo Rivera said the controversy raises red flags over possible corruption-related money flows, the strength of enforcement, and the overall credibility of the country’s anti-money laundering and counter-terrorism financing (AML/CTF) regime.
He said that avoiding a return to the gray list would require stronger prosecution of major money laundering and corruption-linked cases, tighter monitoring of politically exposed persons, and better coordination among government agencies.
Further reforms may also be necessary, such as easing bank secrecy for lawful investigations, improving beneficial ownership transparency, and strengthening the supervisory power of regulators.
The country’s efforts against money laundering and terrorism financing is a continuing project that will be tested by the current corruption scandal that has involved billions of pesos being siphoned away by the perpetrators and their cohorts, both in government and the private sector, made possible by loose rules in the banking sector, particularly when it comes to sizeable government contracts that has been an easy target for a system that is riddled with corruption.
Hopefully our country can tighten the rules and close the loopholes further, if not to keep us out of the FATF gray list, but also to make it as hard as possible for the corrupt to plunder our nation’s coffers.*
