Turning the tide: How the Philippines broke free from the FATF grey list

In a significant move that will positively impact both global financial stability and local innovation, the Philippines has officially been removed from the Financial Action Task Force (FATF) “grey” list (viz. jurisdictions under increased monitoring). This is a momentous achievement for the country, reflecting the progress made in enhancing its anti-money laundering (AML) and counter-terrorism and counter-proliferation financing (CTF & CPF) frameworks.

At Azentio, we operate in a space where compliance is critical, and we are incredibly proud of the role we play in supporting organizations through AMLOCK, our advanced anti-money laundering (AML) solution. With the Philippines now being recognized for its robust efforts in strengthening its financial regulatory frameworks, there are both challenges and opportunities for businesses in the region, especially in the tech sector.

What is the FATF grey list and why does it matter?

The FATF is an international body that sets global standards for AML and CFT measures, ensuring that nations comply with these rules to prevent financial crimes such as money laundering and the financing of terrorism. Countries that fail to meet FATF’s standards are placed on the grey list, signalling that they have deficiencies in their frameworks and need to take corrective actions.

Being on this list can have significant consequences for a country’s economy. For example, it can lead to:

• Reduced foreign investment: Investors tend to shy away from markets where financial crime risks are perceived to be high.
• Increased scrutiny from global financial institutions: Banks and financial institutions may face difficulty in establishing connections or may have to pay higher compliance costs to ensure that they are not exposed to these risks.
• Slower economic growth: Limited access to international markets and capital can stifle growth in various sectors.

On the flip side, being removed from the grey list is a huge win. It signals to the world that the country has made significant strides in reforming its financial systems and strengthening its compliance infrastructure, which fosters trust, boosts investment, and opens doors to international partnerships.

The Philippines’ journey to removal: Key steps and progress

The Philippines’ path to being removed from the grey list in February 2025 was the result of several key actions aimed at aligning with global financial regulations. Some notable steps include:

1. Legislative and regulatory reforms: The Philippines introduced amendments to the Anti-Money Laundering Act (AMLA), particularly focusing on improving the regulation of real estate transactions and the gaming sector (casino junkets), two areas that had previously been highlighted by FATF for high risk of abuse in money laundering schemes. These changes were made to close loopholes and ensure better monitoring.
2. Strengthened financial intelligence: The Philippine government ramped up its enforcement by empowering its Anti-Money Laundering Council (AMLC), which now has greater authority to investigate and monitor suspicious financial activities. This also included ensuring better cooperation between financial institutions and government agencies.
3. Increased international cooperation: The Philippines made concerted efforts to improve its collaboration with international financial institutions and other governments to exchange critical information on financial crimes. This has been pivotal in combating cross-border money laundering and terrorism financing activities.
4. Effective risk-based supervision of Designated Non-Financial Businesses and Professions (DNFBPs).
5. Implementation of new registration requirements for money transfer services and applying sanctions to unregistered and illegal remittance operators
6. Focus on the NPO sector: Appropriate measures taken with respect to the NPO sector (including unregistered NPOs) without disrupting legitimate NPO activity
7. Enhancing the effectiveness of the targeted financial sanctions framework for both terrorist and proliferation financing.

These reforms, coupled with effective implementation, were key factors in the FATF’s decision to remove the Philippines from its grey list.

Comparing global efforts: How do other countries stack up?

The journey of the Philippines is not unique. Several countries have either been removed from the FATF grey list recently, while others remain or have been added to the list. Here’s a comparative look:

Removed from the FATF grey list:

• Botswana: In 2020, Botswana was removed from the grey list after implementing measures such as strengthening its legal framework for combating money laundering and financing terrorism. The country enhanced its regulatory oversight in the financial sector, focusing on improving compliance reporting and monitoring systems.

Countries recently added to the FATF Grey List:

• Laos: Laos was added to the (FATF) grey list in February 2025 due to concerns over the country’s struggles in tackling financial crimes, specifically in areas like risk-based supervision, financial intelligence analysis, and money laundering investigations and prosecutions
• Nepal: FATF has included Nepal in the grey list in February 2025 citing Nepal’s failure to fully implement necessary legal, policy, and structural reforms to combat money laundering and terrorist financing.

Countries Still on the FATF Grey List:

• Yemen: Struggling with political instability, Yemen remains on the grey list due to severe gaps in its regulatory and financial infrastructure.
• Vietnam: Vietnam has taken regulatory action such as Law No. 14/2022/QH15 (“Law 14”), tightening up previous legislation and further aligning Vietnam with international standards but remains on the grey list due to deficiencies in weapons proliferations risks,

The role of technology in compliance: A look at AMLOCK

At Azentio, we’ve long recognized the importance of helping organizations tackle financial crime in a compliant and efficient way. Our AMLOCK solution, a next-gen AML platform, is specifically designed to help businesses manage risk, ensure compliance, and stay ahead of the curve in detecting suspicious activities. With AML regulations becoming more complex, especially in countries like the Philippines, leveraging technology has never been more critical.

Here’s where AMLOCK steps in:

• Advanced transaction monitoring: AMLOCK provides enhanced monitoring of financial transactions, automatically identifying patterns that could indicate money laundering or terrorist financing activities. This is vital for countries like the Philippines, where there’s a need for constant vigilance.
• Enhanced data analytics: With the power of AI and machine learning, AMLOCK can quickly process vast amounts of data to detect trends and anomalies, reduce false positive alerts, making the identification of high-risk activities faster and more accurate.
• Compliance automation: AMLOCK helps businesses automate much of the compliance process, reducing the burden on manual oversight and ensuring that they meet the strictest global standards without missing a beat.

By equipping businesses with the right tools to detect, manage, and mitigate risk, AMLOCK not only supports compliance but also plays a role in safeguarding financial systems from criminal activity.

Looking ahead: Opportunities for the Philippines and beyond

The Philippines’ removal from the FATF grey list is a testament to the country’s growth, resilience, and commitment to global financial standards. But it’s also a turning point for businesses in the region, particularly in the tech and financial sectors. With improved compliance standards, businesses can now operate with greater confidence, attracting more investment and opening the door for international partnerships. This would have a positive impact on the economy allowing over 12 million overseas Filipinos access to faster and cheaper remittance charges with down the line benefits including better peso exchange rate for importers and greater access to credit.

At Azentio, we’re excited about the future. We believe that with the right compliance solutions, such as AMLOCK, organizations in the Philippines, and across the globe, can continue to innovate and grow while ensuring that they are operating within the bounds of the law.

This milestone is just the beginning. As the Philippines continues to enhance its financial integrity, we’re looking forward to being part of the journey by helping businesses stay compliant and ahead of the curve with advanced tech solutions like AMLOCK.

Final thoughts

The removal of the Philippines from the FATF grey list is an exciting and positive development, both for the country and for the wider global economy. It’s a testament to the progress the Philippines has made in strengthening its financial systems, and the role of technology in making this happen cannot be underestimated.

At Azentio, we’re proud to support this ongoing progress with AMLOCK, and we look forward to helping businesses navigate the complex landscape of financial compliance with cutting-edge solutions.

Here’s to a future where compliance, innovation, and growth go hand in hand.