Philippines Directs Gaming Regulator to Review Money Laundering Defenses
Posted on: October 25, 2023, 12:07h.
Last updated on: October 25, 2023, 02:16h.
Philippines President Ferdinand “Bongbong” Marcos Jr. wants his country off an international grey list of jurisdictions reportedly failing to prevent money laundering and terrorism financing activities.
The Financial Action Task Force (FATF) is the world’s global money laundering and terrorist financing watchdog. Established in 1989 and based in Paris, the intergovernmental body sets international standards to prevent illegal activities and the harm they cause to the world.
The Group of Seven founded the FATF, which includes the US, Canada, France, Germany, Italy, Japan, and the European Union. More than 200 countries have signed pledges to adhere to the FATF’s money laundering and terrorism financing safeguards. The Philippines is not one of those countries.
In June, the FATF named the Philippines to its “Increased Monitoring” list. Countries are encouraged to “address strategic deficiencies in their regimes to counter money laundering, terrorist financing, and proliferation of financing.”
The task force explains that when a country is placed under increased monitoring, it means the nation has agreed to “resolve swiftly” its identified deficiencies. The “Increased Monitoring” list is often casually referred to as the FATF “grey list.”
Marcos this week ordered 44 government agencies to take action and adhere to FATF recommendations to better scrutinize large financial movements of money. Among those agencies is the Philippine Amusement and Gaming Corporation (PAGCOR).
PAGCOR is a state-owned entity that regulates commercial casinos in Manila and in the country’s designated freeport zones. PAGCOR is also a gaming regulator, as it runs Casino Filipino venues across the Southeast Asia nation.
Marcos has instructed PAGCOR to participate in the Philippines’ Money Laundering/Terrorism Financing National Risk Assessment (ML/TF NRA). Other government agencies ordered to participate include the country’s bureaus of customers and immigration, the Philippine National Police, and the Department of Finance.
Each agency will send a high-ranking member “who has technical knowledge and operational experience on the matter, and who is fully authorized to decide for or on their behalf,” Marcos’ Memorandum Curriculum read.
The Philippines’ Anti-Money Laundering Council will serve as the lead agency for the ML/TF NRA.
Casino Used Before
The most high-profile case involving a casino in the Philippines being used to move dirty money occurred in 2016 when hackers in North Korea allegedly withdrew $81 million from the Bangladesh Bank’s account at the US Federal Reserve Bank in Manhattan.
The $81 million in illicit transactions were moved through an account with the Rizal Commercial Banking Corporation in the Philippines. From there, the funds were reportedly laundered through several facilities, one being Bloomberry Resorts’ Solaire Resort Casino in Manila’s Entertainment City.
Bangladesh, seeking to recoup its $81 million, has an ongoing lawsuit against RCBC for not knowing their customer. The case has reached the New York Supreme Court. The same court said it lacks jurisdiction over Bloomberry because the company had no involvement in the international facilitation of the fund transfers.
The hackers had initiated withdrawals totaling nearly $1 billion before a Federal Reserve official detected the scheme after noticing that one of the requests was for an entity called the “Shalika Fandation.” The misspelling of “foundation” prompted a closer inspection of the withdrawals, with Bangladesh officials saying they didn’t initiate the transfers.
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