BSP only collated info: BPI denies being under probe

CEBU, Philippines — The Bank of the Philippines Islands (BPI) denied reports that it is under formal investigation by the Bangko Sentral Ng Pilipinas (BSP) following its alleged link to foreign finance institutions suspected of money laundering scandal.

“There is no formal investigation by the BSP on BPI with respect to Westpac. But, the BSP has requested for certain information regarding Westpac LitePay transactions,” clarified the BPI’s official statement of the issue, through the bank’s Head of Corporate Affairs and Communications Owen Cammayo.

According to Cammayo BPI and Westpac entered into a remittance tie-up arrangement for the use of Westpac's LitePay platform back in 2016. Westpac's clients used this platform to send remittances to the Philippines for BPI to fulfill, whether for credit to the accounts of BPI clients or for those of other Philippine banks. At the time of initiation of the partnership, Westpac made representations and warranties that they are in compliance with all applicable regulations.

From July 2016 to October 2019, a total of only 61,687 transactions were coursed through BPI and credited to various recipient banks in the Philippines.

Of this number, 34 percent was credited to BPI accounts, the second largest in terms of transaction count. Of the 23 million Westpac transactions cited by AUSTRAC, only 0.27 percent was coursed through BPI.

The Ayala-led bank suspended its use of Westpac LitePay on November 24, 2019, immediately upon learning of the Australian authorities' investigations against Westpac.

“The alleged failures of Westpac's LitePay facility are a very serious concern to us. We have always worked closely with the regulators and authorities to ensure continued compliance with both domestic and global money laundering laws and regulations,” Cammayo said.

CNN reported that Westpac allegedly failed to report more than 19.5 million fund transfer instructions in and out of Australia to the Philippines and other parts of Southeast Asia.

The transactions in question supposedly involve money for child exploitation.

Australian regulator AUSTRAC has accused Westpac of breaking the law over 23 million times, as the supposed frequent and low-value payments sent via LitePay — its online remittance platform — trace back to "at least 2013."

Aside from BPI, 10 lenders may be covered by the review, the report said.

The Ayala-led BPI has submitted a partial report to the regulator. The central bank is still verifying the details of the incident, which could last until January 2020.

BSP for its part said it is closely coordinating with the Anti-Money Laundering Council Secretariat and other identified institutions to gather additional information and verify details of the transactions. 

“The duration of the onsite review, which will be a focused look on the remittance transactions and processes, will depend on the extent of information that we will be able to gather,” BSP said in a press statement.