Senate, House to pass changes to anti-money launder law

The Senate votes this afternoon on the two remaining major amendments to the Anti-Money Laundering Act (AMLA) — the provisions on court order and retroactivity — before passing the urgent measure on second and third reading.

The House of Representatives is also scheduled to approve today the proposed changes to the AMLA, otherwise known as Republic Act 9160 — provided it is able to muster a quorum.

House opposition members, led by Minority Leader Carlos Padilla, have vowed to invoke the rule on quorum if the chamber’s attendance is insufficient.

Should the two chambers of Congress opt not to pass the amendments, a confederation of overseas Filipino workers (OFWs) threatened to take revenge by not voting for re-electionist legislators in the 2004 elections.

The National Network of OFW and Families, a confederation of 20 migrant groups, yesterday said lawmakers should amend the AMLA or face the wrath of seven million OFWs and their families when the 2004 elections comes.

Senate Majority Leader Loren Legarda said this afternoon’s session will tackle only the amendments to the AMLA, as the chamber bids to meet the Feb. 12 deadline imposed by the Paris-based Financial Action Task Force (FATF).

The FATF groups more than 50 nations, led by the United States, that are waging a global campaign against "dirty money" and the illegal activities from which it is generated.

Representatives of these nations are holding a plenary session in Paris tomorrow and on Wednesday to discuss the case of the Philippines and a few other nations deemed not cooperating in the campaign.

Sen. Ramon Magsaysay Jr., chairman of the Senate committee on banks and sponsor of the bill, said the amendment on the court order merely modifies and does not repeal the provision of the Bank Secrecy Law on the opening of bank accounts.

"The opening of suspicious bank accounts will effectively prevent the laundering of dirty money, as well as facilitate the prosecution of money launderers," he stressed.

Under present laws, authorities, including the Anti-Money Laundering Council (AMLC), could only freeze suspicious accounts but not open them.

Opening bank accounts need a court order. The proposed amendment would enable the AMLC to open suspicious bank accounts without securing any court order.

Magsaysay said depositors have nothing to fear if they know that their accounts are legitimate.

He said the amendment would authorize the Bangko Sentral ng Pilipinas (BSP), through the AMLC, to inquire into a particular deposit or investment only when there is reasonable ground to believe that an unlawful money-laundering activity is about to be, is being, or has been committed, to establish such offense.

"Only those with highly suspicious accounts will be overly belligerent toward this issue and are expected to rush in transferring their ill-gotten deposits to countries which are uncooperative to the global fight against money laundering," he contended.

Senate President Franklin Drilon is confident that opening suspicious accounts without a court order will not result in capital flight.

"Where would those persons deposit their money? Almost all countries have stringent laws against money laundering," Drilon said.

The FATF has called the AMLA inadequate because of its adherence to the bank secrecy law and its "high" threshold amount of P4 million. A threshold amount is the minimum amount involved in a single transaction that would entail automatic reporting by the financial institution to the AMLC.

The Senate, crossing party lines, voted 11-10 in favor of a threshold amount of P2 million as proposed by Minority Leader Vicente Sotto III.

Court order

Sen. Joker Arroyo leads the opposition to the lifting of a court order to open suspicious accounts. He predicted that more than 11 senators would vote against the lifting.

Arroyo said the BSP is using the threat of FATF-imposed banking sanctions to get the amendments passed.

"What Congress is asking for is for BSP to show the laws of other countries which say in precise language that bank deposits can be opened by them without court intervention. Unfortunately, what the BSP had been exhibiting are self-serving opinions and commentaries... which cannot take the place of the precise text of the foreign laws themselves," he said.

Arroyo added that BSP Gov. Rafael Buenaventura should not use Congress as a convenient excuse for his failure to negotiate better terms with the FATF. – With Mayen Jaymalin, Sammy Santos, AFP