Lynch Calls for Philippines to Comply with Anti-Money Laundering Standards Before TPP Consideration

This week, Congressman Stephen F. Lynch (D-Boston), the top Democrat on the House Financial Services Committee Task Force to Investigate Terrorism Financing, led six bipartisan colleagues in a letter calling for the Philippines to be held accountable to international anti-money laundering standards before being considered for membership in the Trans-Pacific Partnership (TPP). Current anti-money laundering law in the Philippines does not cover the gaming industry, allowing money to flow unmonitored through the country's casinos.

A recent New York Times report called attention to deficiencies in the Philippines' Anti-Money Laundering and Combating the Financing of Terrorism (AML/CFT) regime. Since the gaming industry is not covered under AML/CFT law, funds are not able to be traced once they reach a casino. This loophole is a major vulnerability for money laundering. The Financial Action Task Force (FATF), the international watchdog agency that sets international standards for anti-money laundering, has flagged this problem as having the potential to be exploited by terrorist groups.

"Our international anti-money laundering standards are a key tool in combating terrorist financing. The Philippines cannot continue to allow large sums of money to be transferred from their banking system to the gaming industry without the ability to track beneficiaries. This loophole can have grave consequences and poses a major risk for exploitation by criminal organizations and terrorist groups," said Congressman Lynch. "I have serious concerns about the Philippines' eligibility for membership in the Trans-Pacific Partnership if they are blatantly failing to meet established anti-money laundering standards."

The cosigners of the letters are Financial Services Committee Ranking Member Maxine Waters (CA-43), Task Force to Investigate Terrorism Financing Chairman Mike Fitzpatrick (PA-08), Task Force to Investigate Terrorism Financing Vice Chair Robert Pittenger (NC-09), Congressman Keith Ellison (MN-05), Congressman Michael E. Capuano (MA-07), and Congressman Tom Emmer (MN-06).

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