AMENDMENTS to the Anti-Money Laundering Act (AMLA) and the Human Security Act (HSA) should be passed before October to avoid sanctions from the global anti-money laundering watchdog, according to Bangko Sentral ng Pilipinas Governor and Anti-Money Laundering Council (AMLC) Chairman Benjamin E. Diokno.
The Philippines has been under a 12-month observation period since October to implement reforms, particularly to tighten laws against money laundering and counter-terrorism financing. By October this year, the country will be required to submit a comprehensive progress report to the Asia/Pacific Group on Money Laundering (APG).
“Of course there is a window these last few days [for the passage of the amendments]… Medyo tight na ’yung window na yon…But there is another window which is one month — May to June. But we are confident, heavily endorsed naman siya,” Mr. Diokno told reporters on the sidelines of a forum held in Makati on Tuesday.
The 18th Congress will be on a break from Mar. 14 to May 3.
Finance Secretary Carlos G. Dominguez III said the bills amending the AMLA and HSA will be certified as urgent by President Rodrigo R. Duterte.
“He (Mr. Duterte) confirmed the recommendation to have the BoC (Bureau of Customs) and AMLC vigorously investigate, enhance monitoring, and to certify as urgent pending bills affecting AMLA and the lifting of the Bank Secrecy Law in cases of predicate crime such as money laundering and tax evasion,” Mr. Dominguez told reporters in a Viber message on Tuesday.
Among the amendments to AMLA being pushed are:
• Inclusion of tax crimes; and violations of the Strategic Trade Management Act, relative to proliferation financing of weapons of mass destruction as predicate offenses;
• Inclusion of real estate agents, who engage in buying and selling of real properties;
• Authority of the AMLC to implement targeted financial sanctions;
• Authority of the AMLC to preserve assets subject of freeze orders or asset preservation orders; or authority to retain forfeited assets;
• Expansion of investigative powers of the AMLC, that is, subpoena and contempt powers; and
• Prohibition of injunction against the freeze and forfeiture power of the AMLC.
Meanwhile, House Bill 7141 which seeks to amend the HSA has been pending with the Committee on Public Order and Safety since March 2018. The Senate on Feb. 26 approved on final reading Senate Bill No. 1083, which amends the HSA.
“In relation to the HSA, one of the very important and very urgent MER recommended actions is to amend the legal framework to enable ex parte domestic designations of terrorists, individuals, and organizations; and to implement targeted financial sanctions to stop the flow of funds or assets to terrorists and to stop the use of such funds or assets, pursuant to United Nations Security Council (UNSC) Resolution 1373,” the AMLC said in a statement released on Tuesday.
AMLC said one of the key assessments of the APG’s third mutual evaluation report on the Philippines found that the country had a “relatively strong legal framework with some key gaps in AML/CTF systems and serious risks of financial crime with low levels of effectiveness in combating those risks.”
If the Philippines fails to implement the recommendations set, the country will be identified as a “jurisdiction with strategic deficiencies in its AML/CTF regime that presents a risk to the international financial system.”
“Consequently, our inclusion in the gray list will result to an additional layer of scrutiny from regulators and financial institutions, thereby 1) increasing the cost of doing business; 2) delaying the processing of transactions; and 3) blocking the country’s road to an ‘A’ credit rating,” AMLC said. — L.W.T.Noble