ANTI-MONEY LAUNDERING ACT RA 9160, AS AMENDED BY RA 9194 Flashcards
Covered institutions and their obligations
- Supervised or regulated by the Bangko Sentral ng Pilipinas Banks
2.Supervised or regulated by the Insurance Commission - Supervised or regulated by the Securities and Exchange Commission
- Jewelry dealers who deal with precious metals, and precious stones for transactions in excess of One Million Pesos
- Company service providers which, as a business
- Persons who provide for any of the following services:
a. Managing of client money, securities, or other assets - Casinos, including internet and ship-based casinos with respect to their casino cash transactions related to their gaming operations.
Persons and institutions covered by the Anti- Money Laundering Act are subject to the following obligations:
Customer Identification (“Know Your Client”) - covered and institutions shall:
* Establish and record the true identity of its clients based on official
documents;
* Maintain a system of verifying the true identity of their clients
* For corporate clients, require a system of verifying their legal existence and
organizational structure, as well as authority and identification of all
persons purporting to act on their behalf;
* Absolutely prohibit anonymous accounts, accounts under fictitious names,
and all other similar accounts;
* Allow peso and foreign currency non-checking numbered accounts.
Reporting of Covered and Suspicious Transactions
* Covered institutions and persons shall report to the Anti-Money Laundering Council (AMLC) all covered transactions and suspicious transactions within five (5) working days from occurrence thereof, unless the AMLC prescribes a different period not exceeding fifteen (15) working days
* A transaction should be reported as a suspicious transaction if the transaction in question is determined to be both a covered and suspicious transaction
Record Keeping
* Covered institutions and persons shall maintain and safely store all records of transactions for five (5) years from the dates of transactions;
* For closed accounts, covered institutions and persons shall preserve and store the records on customer identification, account files, and business correspondence for at least five (5) years from the dates when they were closed.
General Rule
General Rule: A covered transaction is a transaction in cash or other equivalent monetary instrument involving a total amount in excess of Php 500,000 within one banking day. Exception: for Casinos or “covered persons under Section 3(a)(8),” a single casino transaction involving an amount in excess of Php 5,000,000 or its equivalent in any other currency.
Suspicious Transactions are transactions with covered institutions, regardless of the amount involved, where any of the following circumstances exist:
a. There is no underlying legal or trade obligation, purpose or economic justification;
b. The client is not properly identified;
c. The amount involved is not commensurate with the business or financial capacity of the client;
d. Taking into account all known circumstances, it may be perceived that the client’s transaction is structured to avoid being the subject of reporting requirements under this Act
e. Any circumstance relating to the transaction which is observed to deviate from the profile of the client and/or the client’s past transactions with the covered institution;
f. The transaction is in any way related to an unlawful activity or offense under this Act
that is about to be, is being or has been committed
Safe harbor provision
No administrative, criminal, or civil proceedings shall lie against any person for having made a covered transaction report or suspicious
transaction report in the regular performance of his/her duties in good faith, whether or not such reporting results in any criminal prosecution under the Anti-Money Laundering Act or any other law. Exemption from Bank Secrecy Laws. When reporting covered or suspicious transactions to the AMLC, covered persons and their officers and employees shall not be deemed to have violated RA No. 1405 (Secrecy of Bank Deposits), as amended, RA No. 6426 (Foreign Currency Deposits Act) and RA No. 8791 (General Banking Law), and other similar laws, provided that confidentiality is observed.
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When is money laundering committed
Persons liable for Money Laundering: 1. Any person; or
2. Any person employed with a covered institution Elements:
1. The monetary instrument or property represents, involves or relates to the proceeds of any
unlawful activity;
2. Knowledge of the offender that the monetary instrument or property represents, involves or
relates to the proceeds of the unlawful activity;
3. The offender commits any of the following:
a) Transacts said monetary instrument or property;
b) Converts, transfers, disposes of, moves, acquires, possesses or uses said monetary
instrument or property;
c) Conceals or disguises the true nature, source, location, disposition, movement, or
ownership of or rights with respect to said monetary instrument or property;
d) Attempts or conspires to commit money laundering offenses referred to in paragraphs
(a), (b), and (c);
e) Aids, abets, assists in or counsels the commission of the money laundering offenses
referred to in paragraphs (a), (b), and (c) above; and
f) Performs or fails to perform any act as a result of which he/she facilitates the offense of
money laundering referred to in paragraphs (a), (b), and (c) above.
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“Unlawful Activity” refers to any act, omission, or series or combination thereof involving or having any direct relation to the following:
- Kidnapping under ransom;
- Sections 4, 5, 6, 8, 9, 10, 12, 13, 14, 15, and 16 of the Comprehensive Dangerous Drugs Act;
- Section 3, paragraphs B, C, E, G, H, and I of the Anti-Graft and Corrupt Practices Act;
- Plunder;
- Robbery and Extortion;
- Jueteng and Masiao punished as Illegal Gambling;
- Piracy on the high seas;
- Qualified Theft;
- Swindling and Other Forms of Swindling;
- Smuggling;
- Violations of the Electronic Commerce Act;
- Hijacking and other violations of the Anti-Hijacking Law and Destructive Arson and Murder;
- Terrorism and Conspiracy to Commit Terrorism
- Financing of Terrorism and offenses punishable under the Terrorism Financing Prevention and Suppression Act;
- Bribery and Corruption of Public Officers;
- Frauds and Illegal Exactions and
- Transactions;
- Malversation of Public Funds and Property; Forgeries and Counterfeiting;
Authority to inquire into bank deposits
The Anti-Money Laundering Council may inquire into or examine any particular deposit or investment, including related accounts, with any banking institution or non-bank financial institution upon order of any competent court.
* The term “related accounts” shall refer to accounts, the funds and sources of which originated from and/or materially linked to the monetary instrument(s) or property(ies) subject of the freeze order(s).
* The order of the competent court must be based on:
1. An ex parte application in cases of violations of the Anti-Money
Laundering Act; and
2. Probable cause that the deposits or investments, including related
accounts involved, are related to an unlawful activity.
No court order shall be required in the following cases:
No court order shall be required in the following cases:
1. Kidnapping for ransom;
2. Sections 4, 5, 6, 8, 9, 10, 12, 13, 14, 15, and 16 of the Comprehensive
Dangerous Drugs Act;
3. Hijacking and other violations of the Anti- Hijacking Law and
Destructive Arson and Murder;
4. Felonies similar to those previously mentioned which are punishable
in other countries;
5. Terrorism and conspiracy to commit terrorism
The Court of Appeals shall act on the application to inquire into or examine any depositor or investment with any banking institution or non- bank financial institution within twenty-four (24) hours from the filing of the application.
Freezing and forfeiture
Who may apply
Upon verified ex parte petition by the AMLC and after determination that probable cause exists that any monetary instrument or property is in any way related to an unlawful activity, the Court of Appeals may issue a freeze order, which shall be effective immediately, directing the concerned covered persons and government agency to desist from allowing any transaction, withdrawal, transfer, removal, conversion, concealment, or other disposition of the subject monetary instrument or property.
Effectivity
The freeze order shall be effective immediately and shall not exceed six (6) months depending upon the circumstances of the case.
On motion of the AMLC filed before the expiration of the original period of the freeze order, the court may, for good cause shown, extend its effectivity. Upon the timely filing of such motion and pending resolution by the Court of Appeals, the freeze order shall remain effective.
Duties of covered institutions
In relation to Freeze Orders, the covered institutions and persons have the following duties:
1. Implement freeze order. Upon receipt the covered institution shall immediately freeze the monetary instrument or property and desist from and not allow any transaction, withdrawal, transfer, removal,
conversion, other movement, or concealment thereof.
2. Freeze and report related accounts.
3. Furnish copy of freeze order to owner or holder.
4. Submit the written detailed return. To the Court of Appeals and AMLC, within twenty- four (24) hours
from receipt of the freeze order, a detailed written return which shall include:
a. Account numbers and/or description of the monetary instruments, property or proceeds involved;
b. Names of the account owners or holders;
c. The value of the monetary instrument, property, or related accounts as of the time they were
frozen;
d. All relevant information as to the nature of the monetary instrument, property or instruments;
e. Any information on the related accounts pertaining to the monetary instrument or property
subject of the freeze order; and
f. The date and the time when the freeze order was served;
5. Freeze all related accounts upon the receipt of the freeze orders and upon the verification of the covered institution that these are accounts related to the monetary instrument or property subject of the freeze order.
Forfeiture Provisions
Civil Forfeiture
Upon determination by the AMLC that probable cause exists that any monetary instrument or property is in any way related to an unlawful activity or a money laundering offense, the AMLC shall file with the appropriate court (through the OSG) a verified ex parte petition for forfeiture.
What is covered by the forfeiture
The forfeiture shall include those other monetary instrument or property having an equivalent value to that of the monetary instrument or property found to be related in any way to an unlawful activity or a money laundering offense, when:
a. with due diligence, the former cannot be located, or
b. it has been substantially altered, destroyed, diminished in value or otherwise rendered worthless by any act or omission, or
c. it has been concealed, removed, converted, or otherwise transferred, or
d. it is located outside the Philippines or has been placed or brought outside the jurisdiction
of the court, or
e. it has been commingled with other monetary instrument or property belonging to either
the offender himself or a third person or entity, thereby rendering the same difficult to identify or be segregated for purposes of forfeiture.
