Senate feels pressure to amend anti-money laundering law

With the looming blacklisting of the Philippines by the international Financial Action Task Force (FATF), the Senate is feeling the pressure to pass the amendments to the existing Anti-Money Laundering Act (AMLA).

 

"The pressure is on us because if they put us on the blacklist, then we pay the penalty for being downgraded to blacklist," Senator Sergio Osmeña III, chairman of the Senate panel on banks, financial institutions, and currencies, told reporters during an interview on Thursday.

 

Earlier in the week, Malacañang urged the Senate through a letter to approve the Terrorist Financing Suppression Act and Senate Bills 3009 and 3123 which aim to amend the AMLA by May, or else the FATF will put the Philippines on its blacklist.

 

SB 3009 seeks to allow the Anti-Money Laundering Council (AMLC) to inquire into bank deposits based on an ex parte application and allow courts other than the Court of Appeals to issue freeze orders. 

 

SB 3123 seeks to expand the list of entities who shall be required to report financial transactions to the AMLC to include casinos, dealiers, pre-need companies, real estate agents, trust and company providers, among others.

 

On the other hand, the Terrorist Financing Suppression Act seeks to allow authorities to freeze terrorist funds and inquire into bank accounts even without a court order.

 

SB 3009 and the Terrorist Financing Suppression Act are already in the plenary while SB 3123 is still pending at the committee level.

 

"We just hope that these bills become law before the FAFT plenary in june 2012 otherwise the phils would be relegated to the blacklist of vulnerable jurisdictions with strategic deficiencies on anti-money laundering and combatting the financing of terrorists," AMLC executive director Vicente Aquino told reporters on Thursday.

 

He explained that if the Philippines is blacklisted, we should expect "drastic countermeasures or sanctions."

 

"The people [who] will be hit hard or hit hardest are our overseas Filipino workers (OFW) and their families because these sanctions would result in delayed and costly remittances, high intermmediation costs and other charges and these will not also be good for the banking sector," he said. Fears, worries...

 

Osmeña also expressed worry over what would happen to the country's economy if the FAFT warns the other countries about the Philippines.

 

"After a while those banks would say I don't wan to handle your transactions anymore...what happens to our international financial commitments? Investors who have invested here and would have to buy capital goods or would have to remit profits to their mother companies," he said.

 

"It should be easy for us to transfer money from Manila to New York in five minutes...the moment it becomes five hours or 5 days, believe me no one will do business with us," he added.

 

Congressional oversight committee on the AMLA chair Senator Teofisto Guingona III, for his part, said they may still be able to pass the bills when they resume session in May.

 

"Well, I still think naman [na] pwedeng gawin, right after the break... we can speed up everything," he said in a separate interview. The Senate will adjourn session on March 23 and resume on May 7.

 

Osmeña, however, said they probably won't be able to pass it before the deadline.

 

"I would imagine that there's a chance to pass it in June, the President may call for a special session just to pass this into law because the penalties are too painful," he said, adding that they are still bogged down by the impeachment trial. — RSJ, GMA News