BSP disseminates Anti-Money Laundering Council Guidance on Sanctions Screening

The Bangko Sentral ng Pilipinas (BSP) has disseminated the AMLC Guidance on Sanctions Screening – A 2022-2023 Thematic Review of the Effectiveness of Customer and Transaction Screening Systems of Covered Persons in Targeted Financial Sanctions (TFS) Implementation.


The Anti-Money Laundering Council (AMLC) recently conducted a comprehensive review of the customer and transaction screening systems employed by covered persons to ensure compliance with targeted financial sanctions (TFS). This assessment comes as the country strives to strengthen its regulatory framework in line with international standards. With the Philippines on the Financial Action Task Force’s “grey list,” the AMLC recognizes the urgency of enhancing its measures to combat money laundering and counter-terrorism financing.


The review by the AMLC aimed to evaluate the effectiveness of customer and transaction screening systems implemented by covered persons in enforcing TFS regulations. The scope of the assessment encompassed financial institutions, designated non-financial businesses, and professions, including lawyers, accountants, and real estate agents. With a keen focus on reducing vulnerabilities, the AMLC scrutinized the screening systems’ capacity to identify and mitigate the risks associated with individuals or entities subject to targeted financial sanctions. These sanctions often involve individuals or organizations linked to money laundering, terrorism financing, or other illicit activities.


The Thematic Review conducted by the AMLC on customer and transaction screening systems in the country identified several trends and observations, which include: (a) insufficient screening processes; (b) technology gaps; (c) lack of competent personnel; (d) inconsistent risk-based approach; (e) inadequate documentation and record-keeping; and (f) delayed or inadequate reporting.  Moreover, AMLC identified that it is how a system is used by the Covered Person and not the actual system itself that provided outstanding results against their peers. The above mentioned trends and observations underscore the need for Covered Persons to enhance their screening systems.


To address these areas of concern, the AMLC outlined key supervisory expectations that would serve as guidelines for covered persons to improve their compliance measures and ensure the integrity of the financial system. The AMLC emphasizes the following points:


  • Comprehensive Screening Procedures: Covered persons should implement robust and thorough screening procedures to identify and prevent transactions involving individuals or entities subject to targeted financial sanctions (TFS). This includes conducting ongoing customer due diligence and screening against relevant watchlists and sanction databases.
  • Adequate Technology Infrastructure: Covered persons need to invest in appropriate technology infrastructure to support efficient and accurate screening processes. This includes utilizing up-to-date screening software, maintaining comprehensive databases of relevant watchlists, and regularly updating systems to ensure effectiveness.
  • Competent Personnel: Covered persons must have competent and trained personnel responsible for conducting screening and overseeing compliance measures. Adequate training and awareness programs should be implemented to ensure employees are equipped with the necessary knowledge and skills to identify and handle TFS-related risks.
  • Risk-Based Approach: Covered persons should adopt a risk-based approach to customer and transaction screening, taking into account the nature of their business, customer profiles, and geographical risks. This enables a more focused and targeted screening process that prioritizes higher-risk transactions and entities.
  • Documentation and Recordkeeping: Covered persons must maintain accurate and up-to-date documentation and records of their screening processes. This includes documenting the results of screenings, justifying any decisions to proceed with transactions involving potential matches, and retaining records for the required period as per applicable laws and regulations.
  • Reporting Suspicious Transactions: Covered persons should promptly report any suspicious transactions or activities to the appropriate authorities, as prescribed by law. Timely reporting plays a crucial role in combating money laundering and terrorist financing.


This comprehensive review assumes greater significance as the Philippines strives to address the challenges posed by money laundering and terrorism financing. The Guidance Sanctions Screening as conducted by the AMLC highlights its commitment to working closely with covered persons, regulatory bodies, and relevant stakeholders to ensure the effective implementation of targeted financial sanctions.


The full issuance can be accessed here.

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