Congress ratified the amendments to the Anti-Money Laundering
Act (RA 9160) on 13 February 2003, but failed to meet
the 12 February deadline of the Financial Action Task
Force (FATF). President Gloria Macapagal Arroyo did not
sign the ratified bill into law since Congress failed
to transmit the enrolled copy of the bill. FATF has extended
the deadline for the new law to 15 March. Otherwise, the
country faces counter-measures from FATF member-countries.
The Philippines remains in the list of 10 Non-Cooperative
Countries and Territories since June 2000. FATF noted
that the country has already complied with 37 out of
its 40 recommendations against money laundering. The
law’s weaknesses lie in the high threshold for
reporting covered transactions; the lack of a reporting
system on suspicious transactions; the requirement for
a court order to inquire or examine bank deposits and
investments; and the non-retroactivity of the AMLA.
On 19 February 2003, legislators motioned to reconvene
the bicameral conference committee to discuss what to
do with the bicameral committee report. Although the
measure sets the threshold at P500,000, as recommended
by FATF, the provision allowing inquiry into deposits
without a court order was limited to accounts involving
transnational crimes—kidnapping for ransom; violations
of the Comprehensive Dangerous Drugs Act of 2002; hijacking,
destructive arson and murder, including those perpetrated
by terrorists. The retroactivity clause was not adopted.
Failure to meet international standards will result
to rigorous screening of OFW remittances; increased
transaction costs for importers and exporters due to
delays; and negative effects on investments as FATF
warns non-financial businesses that transactions with
the country are subject to suspicion.
