Southeast Asia continues to be targeted by global financial regulators. The latest red flag has been raised by the European Union which has chosen to keep the Philippines and Cambodia on its list of countries that are struggling to enforce up-to-date anti-money laundering controls and pose a threat to businesses and consumers.
Watch Out for Gamblers from Cambodia and the Philippines
The European Commission updated its list of such countries last week, retaining much of its last assessment. Cambodia had a recent falling out with the United States over comments by the US State Department that the country was failing to maintain tight control over financial transparency.
The EU has reiterated its position towards Cambodia and the Philippines, among others, as countries that have shortcomings in enforcing AML policies. As a result, gaming properties that are based in the European Union would need to be extra cautious when accepting customers from any of the named locations.
Countries such as the Philippines are already on the Financial Action Task Force (FATF) list, which has explained the overall negativity towards Western-led financial sanctions and regimes. However, the EC has confirmed that it would be happy to work with the financial authorities of the countries it has on its list in order to ensure that they are compliant with a global order of things.
The Commission further motivated its selection of countries to be put on the list based on comprehensive criteria. This included but wasn’t limited to due diligence measures, various suspicious financial transactions, reports of money laundering, and a country’s own track record with tackling such issues and any documented and provable deficiencies in addressing the problems outlined in the report.
More Needs to Be Done to Address Underlying Issues
The report is carried out once every several years with the next date set for 2025. The Commission is already looking into possible mitigation factors and ways to improve the overall state of money-laundering in each of the named countries. Both the Philippines and Cambodia are some of the biggest countries when it comes to localized gambling, but both countries seem to be firmly embedded on the FATF list.
AML and CFT policies have been failing for both, independent auditors have argued, making the threat of the processing of illegal funds through the gambling industry ever more likely. The Philippines in particular is trying to stem the tide of a crime wave associated with the e-sabong contests in which several police officers have already been implicated.
Meanwhile, Cambodia continues to be cited as a place where human traffickers thrive and prey on victims from the region, forcing them into labor in inhumane conditions and often as part of gambling and telephone scams.