SENATORS rebuked financial regulators on Thursday for failing to promptly investigate the entry of P19.7 billion ($389.6 million) — suspected to have been laundered by Chinese criminal syndicates — into the Philippine financial system last year.
“This is bureaucracy at its worst form,” Senator Richard J. Gordon told regulators during a hearing investigating the transactions and their links to Philippine offshore gaming operators (POGO).
The lawmaker said the Anti-Money Laundering Council (AMLC), which is headed by Bangko Sentral ng Pilipinas Benjamin E. Diokno, did nothing even after more than 800 transactions.
He also said regulators looked into the money transfers in the first quarter of this year when they happened in the first quarter of last year.
“The money had been spent and circulated around the world and you did nothing,” Mr. Gordon said. “You defeat the purpose of the law.”
Various travelers carried the foreign currencies — $336 million, HK$215 million and 2.7 million yen — and entered the Philippines through the Ninoy Aquino International Airport, the senator said, citing AMLC records.
Aside from the almost P20 billion that entered the country in the first quarter of last year, about $633 million (P32 billion) also suspiciously came in from September last year to March this year, Mr. Gordon said, citing Bureau of Customs data.
The Philippines requires travelers to declare money worth more than $10,000 to airport Customs.
Customs officials must submit the declaration forms to the council within 10 days after the end of every month, AMLC Executive Director Mel Georgie B. Racela told the Senate blue ribbon committee headed by Mr. Gordon.
“We do not have any authority to arrest them or seize the cash,” he said. “They are just subject to further investigation should they violate other existing laws,” he added.
“Wouldn’t you say that the continuous unabated entry of millions and millions and millions of dollars — wouldn’t that be suspicious?” Mr. Gordon asked.
Opposition Senator Franklin M. Drilon said this “defeats the purpose” of the Anti-Money Laundering Act, which also requires banks, insurance companies, casinos and other covered entities to report transactions worth at least P500,000 and suspicious transactions to the AMLC.
Under the law, all transaction records must be kept for at least five years, while financial institutions must observe due diligence in dealing with their clients.
“What happens is these are reported and that’s the end of it because of our bureaucracy,” Mr. Drilon said. “Hundreds of millions can be spent and transmitted within a few seconds and it takes us a few months? I think something is wrong with that.”
Mr. Racela said the process takes months because “intelligence information cannot be shared without validating some facts.” “We cannot establish money laundering if we cannot establish the unlawful activity.”
But Mr. Gordon said the AMLC should have at least questioned frequent carriers of large amounts of cash.
The law has a “suspicious transaction provision” that allows the regulator to probe individuals bringing in huge amounts of cash, Mr. Drilon said.
President Rodrigo R. Duterte will support the Finance department’s push to lift the secrecy of bank deposits for tax evasion and money laundering cases, his spokesman Salvador S. Panelo said at a briefing yesterday.
“If that is the position of the Department of Finance, then certainly the President will support it,” he said.
Mr. Duterte had not decided on whether to ban offshore gaming companies here, Mr. Panelo said.
“If there is anything wrong with the POGO system, then we have to review it, evaluate it and then streamline it, improve it and all the agencies involved must do their job so that any corruption, any unlawful acts can be either neutralized or completely stopped,” he added.
Mr. Gordon earlier said offshore gambling companies here were probably being used as fronts for Chinese spies.
The Immigration bureau earlier said it had revamped workers at Terminals 1 to 3 of the international airport in Manila after the “recent resurgence of unauthorized activities and irregularities” there.
The agency relieved 19 officials and employees allegedly involved in a bribery scheme that allowed the illegal entry of Chinese nationals who end up working in POGOs.
Senator Risa N. Hontiveros -Baraquel had shown a video of incoming Chinese nationals being escorted to an office at the international airport in Manila.
She also showed screenshots of Viber messages among Immigration officers discussing the bribery scheme, as well as a worksheet containing the P10,000 paid by each of the tourists.
An immigration officer earlier told a separate Senate committee some blacklisted foreigners had been granted entry for as much as P200,000.
The Immigration bureau asked the Justice department and National Bureau of Investigation last month to probe corrupt practices at the airport, including human trafficking and escort services. — NPA and Charmaine A. Tadalan