RP reaches agreement on money laundering reform

RP reaches agreement on money laundering reform

Cecil Morella, Agence France-Presse, Manila

Philippines legislators have agreed with an international
financial task force to amend Manila's money laundering law to
escape the imposition of sanctions later this month, officials
announced Tuesday.

Congress has 11 days to pass amendments to the 2001 anti-money
laundering act (AMLA), after the Financial Action Task Force
(FATF) rejected changes introduced last month as inadequate and
threatened to impose sanctions from March 15.

A delegation of experts from FATF member countries, led by a
top anti-terrorism official from the United States and a Japanese
financial intelligence official, held two meetings with Filipino
legislators on Monday.

The strict half-century old Philippines bank secrecy law,
which required judicial approval for inspecting accounts, had
been a key sticking point.

"Based on our discussions, the delegation looks forward to
seeing the new amendments from the Philippine legislature that
will enable the AMLA to meet international standards," a mission
statement said.

Noriaki Mizuno, financial intelligence director of the Japan
Financial Services Agency, told a news conference that if the
Filipino legislators passed what they had pledged, "the countdown
would not be applied."

"We have a breakthrough," President Gloria Arroyo's spokesman
Ignacio Bunye told reporters.

"It seems that we still have to wait and see, but the word is,
we're coming closer to coming up with a satisfactory compromise,"
he added.

Senate president Franklin Drilon said he was confident the
deadline would be met.

A statement from the FATF mission said the delegation believed
"a key breakthrough" had been achieved in the discussions with
legislators.

Both sides agreed that "general concerns about court orders
could be respected" while ensuring regulatory agencies such as
the central bank would be able to have access to account
information without the need for a court order, it added.

Drilon added that freezing of suspect accounts by the anti-
money laundering council (AMLC), the enforcement arm of the money
laundering law, would still require court authorization.

The FATF, formed by major developed economies under the
Organization of Economic Cooperation and Development (OECD), has
placed the Philippines on a global blacklist of 10 "non-
cooperative countries and territories".

The FATF has warned that unless amendments were passed in
time, Manila faced sanctions including increased scrutiny of
international banking transactions, which could affect the
remittances of millions of overseas Filipino workers.

Drilon said the legislators also pledged to act on three other
areas of concern raised by the mission, including allowing the
inspection of suspicious transactions regardless of the amount of
money involved.

The amended law would also "remain silent" on whether the AMLC
could provide information to FATF member countries "regarding
deposits and investments made prior" to the law, leaving it up to
the courts to decide, Drilon said.