Duterte signs law strengthening anti-money laundering regulations

President Rodrigo R. Duterte on Friday night signed a law giving authorities more power to go after suspected cases of money laundering, a move that would allow the Philippines avoid being gray-listed by the Financial Action Task Force (FATF).

Republic Act (RA) No. 11521 further strengthens the Anti-Money Laundering Act (AMLA) of 2001, including giving additional powers to the Anti Money Laundering Council (AMLC) and expanding the list of covered persons.

Once published, the law will take effect immediately to allow the Philippines to meet the Feb. 1 deadline set by the FATF to implement tougher action against “dirty money.”

Congress on Jan. 20 ratified the Bicameral Conference Committee report that reconciled House Bill No. 7904 and Senate Bill No. 1945.

Under RA 11521, tax crime involving an excess of P25 million was included in the list of predicate crimes.

The AMLC will be given additional but limited investigative powers, such as the power to apply before a competent court for a search and seizure warrant, and a subpoena.

It also gives AMLC the authority to preserve, manage or dispose of assets pursuant to a freeze order, preservation order or judgment of forfeiture. The AMLC may also implement targeted financial sanctions against the proliferation of weapons of mass destruction and its financing.

Real estate developers and brokers, as well as Philippine offshore gaming operators (POGOs) and their service providers were also included as covered persons under AMLA.

The law also raised the amount for covered transactions to a a single cash transaction involving an excess of P7.5 million or its equivalent in other currencies.

The FATF, a global dirty money watchdog, gave the Philippine government until Feb. 1 this year to enact and implement the changes to the AMLA in order to address gaps in countering money laundering and terrorist financing. The initial deadline was originally set in October 2020, but was extended due to the coronavirus pandemic.

Quirino Rep. Junie E. Cua, who heads the House committee on banks and financial intermediaries, said the law would help the Philippines avoid being included in the gray list of the FATF.

“I am elated that the law has finally been signed. We are now safe from being included in the gray list of FATF,” he told BusinessWorld on Friday night.

The AMLA was first passed in September 2001 and was amended in 2003 to address concerns over the high threshold level for covered transactions, the coverage of institutions and bank secrecy.

Lawmakers then lowered the threshold for covered transactions to P500,000 from P4 million, empowered the central bank to examine deposits or investments with any banking institutions without a court order during a periodic or special examination, and allowed the law to be applied retroactively.

Congress again amended the law in 2012 by allowing the issuance of a freeze order and empowered the AMLC to conduct a bank inquiry within 24 hours after filing a court action. – Kyle Aristophere T. Atienza