Phl risks FATF blacklist over AMLC changes

Arroyo bill ‘irresponsible’ – UN envoy

MANILA, Philippines – The Philippines is courting a possible blacklist from the inter-governmental body Financial Action Task Force (FATF) if the proposed bill insulating the Bangko Sentral ng Pilipinas (BSP) from the activities of the Anti-Money Laundering Council (AMLC) is passed into law.

Sources warned the Philippines could again be included in the blacklist of non-cooperative countries if the bill strips the BSP of the chairmanship of the AMLC.

The FATF  – an international body promoting policies to combat money laundering and terrorist financing – had upgraded the Philippines from the “dark grey list” to its “grey list” in June 2012 due to the initiatives of the government to enhance its transparency and accountability mechanisms in financial transactions.

The upgrade also emanated from the signing into law of “An Act to further strengthen the Anti-Money Laundering Law” and the Terrorism Financing Prevention and Suppression Act of 2012.”

The Philippines barely escaped the FATF blacklist after the money laundering scandal wherein $81 million worth of funds from the Bangladesh Bank was laundered in Philippine casinos using listed Rizal Commercial Banking Corp. (RCBC) as conduit.

The BSP imposed a record P1 billion fine on RCBC for various violations while the AMLC filed several criminal cases against the personalities involved in the cyber theft.

Another source pointed out people in power could use AMLC indiscriminately” against political enemies.

Documents from the AMLC played a major role in the impeachment of the late Chief Justice Renato Corona in 2011 and in the filing of plunder raps against former vice president Jejomar Binay.

The AMLC has earned the ire of President Duterte and Justice Secretary Vitaliano Aguirre for allegedly being uncooperative in building up cases against personalities involved in the illegal drugs trade.

BSP Governor Amando Tetangco Jr. who is being groomed for an unprecedented third term chairs the AMLC with the commissioner of the Insurance Commission and the chair of the Securities and Exchange Commission (SEC) as members.

The AMLC is assisted by a secretariat headed by an executive director and consisting of five (5) units – the Office of the Executive Director, Compliance and Investigation Group, Legal Services Group, Information Management and Analysis Group, and Administrative and Financial Services Division.

Meanwhile, United Nations envoy Teodoro “Teddyboy” Locsin Jr. yesterday described as “irresponsible” the proposal of former president Gloria Macapagal Arroyo to ban the Bangko Sentral ng Pilipinas (BSP) governor from supervising the Anti-Money Laundering Council (AMLC).

“It’s the most irresponsible proposal I’ve heard,” Locsin, one of the principal authors of the law creating the AMLC, told the ABS-CBN News Channel.

Locsin said the BSP governor is the most qualified among the three members of the AMLC to supervise the council.

The two other council members are the insurance commissioner and the chairperson of the Securities and Exchange Commission.

Locsin said as a principal author of the AMLC law, he made sure that all its officers are persons of integrity.

He said the financial and banking community trusts the law and those implementing it.

It is proposals like the one pushed by Arroyo that shake the financial and banking system, Locsin said.

He added there is no proof that, as Arroyo has insituated, AMLC members are loyal to former president Benigno Aquino lll and are sabotaging efforts by the Duterte administration to pry into the bank accounts of those it has linked to illegal drugs.

Arroyo, now a congresswoman representing Pampanga’s second district, is a staunch Duterte ally. She reportedly recommended many of the officials Duterte has appointed to the Cabinet and other juicy government posts.

In a statement on Monday, Arroyo said she has proposed a new provision in Bill 731 to ban the BSP governor from supervising the AMLC.

The bill, authored by Representatives Karlo Norgrales of Davao City and his brother Jericho of party-list group Puwersa ng Bayaning Atleta, seeks to amend the Central Bank Act.

Arroyo said while BSP Gov. Amando Tetangco Jr. “has unquestionably served the BSP itself with distinction, his supervision over the AMLC has exposed some problems.”

She said the council “has been acting much on its own with regard to its investigations, without bothering to get specific clearances from the BSP governor.” 

“The AMLC, whose officers were appointed by the previous administration, has demonstrated the potential of being used as a tool of selective justice. In the previous administration, grossly inaccurate information on the alleged bank accounts of then presidential candidate Rodrigo Duterte and other perceived opponents of the officers’ appointing authority were leaked out,” she said.

“In contrast, information is now being withheld from authorized investigators on the bank accounts of certain persons under investigation, who happen to be identified with the previous authority which appointed them, and to whom they seem to owe their allegiance,” she said.

“Therefore, to insulate the BSP officials from the actuations of AMLC, especially the political ones which may be influenced by the council officials’ loyalty to their appointing authority, the BSP should be liberated from the burden of supervising the very rigorous demands of criminal investigation such as those performed by AMLC,” she said.

She added the BSP governor could remain a member of the council. She did not say who would supervise the AMLC.

Justice Secretary Vitaliano Aguirre ll has complained of the alleged lack of cooperation of AMLC officials in his desire to look into the bank accounts of Sen. Leila de Lima and several convicted drug lords.

But some congressmen said Aguirre should follow the law by first filing a case involving a predicate crime with a special division of the Court of Appeals and having such division order the opening of bank accounts.

The AMLC is now authorized to open any bank account on its own, they said.

“Aguirre should know this as a lawyer and justice secretary,” they said. – Jess Diaz