EDITORIAL - Limited mandate

Long before the terrorist attacks in the United States on Sept. 11, 2001, a brother-in-law of Osama bin Laden operated a charity organization in the Philippines. The brother-in-law is back in the Middle East and his charity is now seen by security officials as a front for financing terrorist activities in the country. Yet Philippine authorities have been slow in imposing regulations that will allow the anti-money laundering police to act on bank deposits and transactions suspected of being utilized for terrorist financing.

A similar problem hampers efforts to stop drug trafficking. The country’s extensive and poorly policed coastlines make it an ideal destination or transshipment point for all types of contraband, from guns to drugs and commercial items. Loopholes in the law have contributed to the popularity of the Philippines for international drug trafficking operations, including the recruitment of Filipinos, mostly women, to serve as drug mules in countries such as China.

The Anti-Money Laundering Council, created a decade ago when the country was forced to comply with international rules or face sanctions, has raised these problems several times in fulfilling its mandate. Apart from the limited coverage of the Anti-Money Laundering Act of 2001, the Supreme Court also ruled that the financial intelligence unit must first secure a court order before it can look into certain suspect bank accounts, including those believed to be used for terrorist financing. The FIU, however, can ask the Court of Appeals for an ex parte freeze order on the accounts before securing the court order to look into the deposits. In certain crimes, the AMLC can look into a suspicious bank account only after notifying its owner, which council members say defeats the purpose of the law.

Washington has taken notice. In the 2011 International Narcotics Control Strategy Report released last Friday, the US State Department took note of the loopholes and said they went against the international standard in controlling the flow of funds to terrorist organizations.

Terrorism and drug trafficking are not the only crimes that the AMLC wants to curb through a stronger law. The council has submitted to Congress proposed amendments to the Anti-Money Laundering Act that will strengthen the campaign against crimes including bribery and corruption, carjacking and fraud. Those proposals must be given priority by Congress.