THE BANGKO SENTRAL ng Pilipinas (BSP) told banks to tighten their Know Your Customer protocols amid a rise in cases involving carnapping syndicates that acquire vehicles through these financial institutions’ credit facilities under fake identities.

Memorandum No. M-2021-047 signed by BSP Deputy Governor Chuchi G. Fonacier reminded BSP’s supervised financial institutions to strengthen their controls and follow anti-money laundering (AML) regulations to prevent these criminal activities.

It said lenders should tighten their guard via strengthening procedures such as customer identification and verification, ongoing monitoring of customers and their transactions, and suspicious transaction reporting.

The BSP also told banks to ramp up their continuing AML training programs, including those focused on controls for partners and accredited car dealers.

“Carnapping syndicates may sometimes resort to identity theft, using an actual person’s name, address, and company profile, but with a different photo. These may be prevented by reinforcing the conduct of, among others, customer identification and verification procedures as part of the customer due diligence,” the memorandum said.

The BSP memorandum mentioned common schemes done by syndicates, based on information from the Philippine National Police-Highway Patrol Group.

Among these is the rent-pawn or rent-selling scheme, where a vehicle is obtained through a rent or lease contract. The culprit, or the lessee in this case, pawns or sells the vehicles using falsified documents without the consent of the lessor or the registered owner.

Another method is the pasalo scheme, where the culprit, using fake documents, sells a vehicle to a buyer who will assume the remaining obligations for the vehicle.

There is likewise a modus operandi dubbed as “labas casa scheme,” where a person will pretend to be a buyer of a vehicle and get an auto loan from a car dealership using counterfeit papers. The perpetrators will find a buyer for the vehicle using fake documents. — LWTN