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No. 65 - November 15, 2001
Anti-Money Laundering Act Signed
Congress took only six days to have the Anti-Money Laundering
Bill (SB 1745 and HB 3083) read, amended, and signed into
law by the President as RA 9160. This is one day before the
Financial Action Task Force's (FATF) non-negotiable 30 September
deadline to pass the bill or face sanctions by the international
banking and investment community. This would have meant an
even bigger blow to the country's already ailing economy.
The law was ratified on 29 September, but not
without contention from oppositionists who feel that due to
the haste taken by both Houses, RA 9160 has loopholes that
will give offenders means of getting away with their money-laundering
activities.
Congressional Vote Record
The House passed HB 3083 on third reading on 27 September
with 125 representatives voting in favor of the bill, and
17 against (Reps. Hussin Amin, Bellaflor Angara-Castillo,
Agapito Aquino, Rozzano Rufino Biazon, Gabrielle Calizo, Joaquin
Chipeco, Enrique Garcia, Jr., Constantino Jaraula, Celso Lobregat,
Abraham Kahlil Mitra, Carlos Padilla, Gilbert Remulla, Rolex
Suplico, Emmylou Taliño-Santos, Cynthia Villar, Georgilu
Yumul-Hermida, and Ronaldo Zamora). There were no abstention.
In voting against the bill, Reps. Padilla
and Lobregat explained that while they subscribe to the wisdom
of the measure, it nevertheless "suffers from constitutional
infirmity." Padilla said the consideration of the measure
should not be tied up with the FATF deadline but rather with
the Vienna Convention of 1988 which was used as reference
point of the President's urgent certification of HB 3083.
Rep. Suplico added that the 30 September deadline was a form
of blackmail on the Philippines while Rep. Remulla believed
that since Congress was rushed, not all issues were threshed
out in the deliberations.
At the Senate, 19 senators voted in favor of the Anti-Money
Laundering Bill (SB 1745): Senators Edgardo Angara, Joker
Arroyo, Robert Barbers, Rodolfo Biazon, Renato Cayetano, Noli
de Castro, Franklin Drilon, Gregorio Honasan, Robert Jaworski,
Panfilo Lacson, Loren Legarda-Leviste, Ramon Magsaysay, Jr.,
Blas Ople, Sergio Osmeña III, Francis Pangilinan, Aquilino
Pimentel, Jr., Ralph Recto, Vicente Sotto III, and Manuel
Villar, Jr. There were no negative votes and no abstention.
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Anti-Money Laundering Act Of 2001
Major Conflicting Provisions at Bicameral Conference
Committee
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House Bill 3083
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Senate Bill 1745
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RA 9160
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Predicate Offenses or unlawful activities
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Four:
• Qualified kidnapping
• Violations of sections 3,4,5,7 and 8 of Dangerous
Drugs Act of 1972
• Violations under Section 3, paragraphs B,C,E,G,H
and I of Anti-Graft and Corrupt Practices Act
• Felonies or offenses of a similar nature of
other countries
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Thirteen:
• Qualified kidnapping
• Violations of sections 3,4,5,7,8 and 9 of Dangerous
Drugs Act of 1972
• Violations under Section 3, paragraphs B,C,E,G,H
and I of Anti-Graft and Corrupt Practices Act
• Robbery and extortion
• Jueteng and Masiao
• Piracy
• Qualified theft
• Swindling
• Smuggling
• Violations of E-Commerce Act of 2000
• Fraudulent practices under Securities Regulation
Code of 2000
• Terrorism
• Felonies or offenses of a similar nature as
the above that are punishable under the penal laws of
the country where the felony or offense was
committed
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Fourteen:
• Kidnapping
• Violations of sections 3,4,5,7,8, and 9 of Article
2 of Dangerous Drugs Act of 1972
• Violations under Section 3, paragraphs B,C,E,G,H,
and I of Anti-Graft and Corrupt Practices Act
• Plunder
• Robbery and extortion
• Jueteng and Masiao
• Piracy on the high seas
• Qualified theft
• Swindling
• Smuggling
• Violations under the Electronic Commerce Act
of 2000
• Hijacking; destructive arson and murder, including
those perpetrated by terrorists against non-combatant
persons
• Fraudulent practices
• Felonies or offenses of a similar nature that
are punishable under the penal laws of other countries
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Threshold Amount of Covered Transactions
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In excess of P5 million or foreign currency equivalent
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In excess of P3 million or foreign currency equivalent
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In excess of P4 million especially cash deposits and
investments
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Numbered Bank Accounts
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BSP will conduct quarterly random testing to ensure
true owners are known to banks concerned
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Prohibited except under Foreign Currency Deposit System
Act
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Prohibits anonymous accounts, accounts under fictitious
names, and all other similar accounts; but allows numbered
accounts for peso and foreign currency non-checking
accounts; however, the banks must know the account holder's
identity for these types of accounts
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Additional Exemptions from Bank Deposit
Secrecy Laws
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Any competent court by ex parte order can freeze a
transaction for a period of ten days to allow AMLU with
the concurrence of at least 5 members of the MB to inquire
into a deposit or investment after establishing probable
cause. Does not allow bonds to quash court orders
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AMLC or MB required to notify depositor of freeze order
and ask for explanation within 72 hours, but should
seek ex parte from the court when freeze order exceeds
20 days. Only the Supreme Court may restrain lower court's
order.
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No court shall issue a temporary restraining order
or writ of injunction against any freeze order issued
by the AMLC except the Court of Appeals or the Supreme
Court
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Fine for Crime of Money Laundering
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Optional with 7-14 years in prison; not less than P1
million but not more than twice the value of the monetary
instrument or property concerned
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Combined with 7-14 years in prison; not less than P3
million but not more than twice the value of the monetary
instrument of property involved
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Combined 7-14 years in prison; not less than P3 million
but not more than twice the value of the monetary instrument
or property involved
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Implementing Body
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Anti-Money Laundering Unit (BSP to appoint a lawyer
as Executive Director of Secretariat for a 4-year term)
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Anti-Money Laundering Council (BSP Governor, Insurance
Commissioner, SEC Chair) and the Monetary Board
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Anti-Money Laundering Council (BSP Governor, Insurance
Commissioner, SEC Chair)
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Powers
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Can issue subpoena duces tecum and ad testificandum
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Can freeze bank deposit for up to 20 days when it examines
or looks into an account upon determination of probable
cause
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Can freeze any deposit or similar account related to
an unlawful activity for a period not exceeding 15 days
but cannot look into an account without a court order
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