Wednesday, April 06, 2016

Dhaka Heist: Despite Lip Service, Manila Capital Controls Remain Shambolic

To outside observers—in this particular case, the inter-government Financial Action Task Force (FATF) based in Paris—the Philippines is reasonably in line with global standards. It has an anti-money laundering law, and it has a dedicated institution (the Anti-Money Laundering Council) to carry out monitoring and enforcement of the law. Where the FATF has expressed concern is in terms of gaps on paper, such as the exemption from monitoring for casinos under the present anti-money laundering act, and all it takes for the Philippines to resolve that sort of concern is a promise to make the appropriate revisions.
It is only when a complaint is raised or some other disaster like the current scandal occurs that it becomes obvious how insufficient the global benchmarks are in terms of providing a realistic assessment. The present anti-money laundering structure is obviously as good as useless, because it completely failed to prevent the 'laundering'—if that is even an appropriate way to describe it—of the Bangladesh Bank's stolen funds. The law says all the right things, yet there is no capacity to enforce it effectively. According to AMLC executive director Julia Abad, the agency only has 28 personnel, only nine of whom are actual financial analysts, to examine the thousands of covered transactions reported each day.

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