This was stressed by Anti-Money Laundering Council (AMLC) Executive Director Julia Bacay-Abad during the recent AMLA 101 briefing at the Bangko Sentral ng Pilipinas (BSP).
She explained that AMLC will investigate suspected money laundering activity upon the submission of covered transaction reports (CTRs) and suspicious transaction reports (STs) reports by institutions covered by the central bank, the Insurance Commission (IC) and the Securities and Exchange Commission (SEC) -- the three government agencies that compose the AMLC.
These institutions include banks, quasi-banks, foreign exchange dealers, money changers, remittances companies, insurance companies, securities dealers, brokers and investment houses.
Other triggers for an AMLC investigation include newspaper and media reports of unlawful or money laundering activities and citizens' sworn statement about these activities.
AMLC gathers information from reports and data from various government agencies, and information provided by other countries' financial intelligence units (FIU) and foreign law enforcement authorities.
Thus, in the case of the USD 81 million stolen from the Bangladesh Bank (BB), the South Asian country's central bank, and allegedly laundered in the Philippines, Bacay said Rizal Commercial Banking Corporation (RCBC) should have reported it immediately.
AMLA-covered entities are required to report -- on a daily basis -- transactions that involve cash or other equivalent monetary instrument if the amount is in excess of PHP500,000.
Bacay said they received the CTR from RCBC regarding the USD 81 million transaction but they did not consider it unusual because it is small compared to other transactions reported to them and because it is only part of the thousands of reports they receive everyday.
She said AMLC has 28 personnel under its Information Management and Analysis Group (IMAG) but only seven of them are financial analysts who check the CTRs.
She said it is the job of banks' compliance officer to report to AMLC any suspicious transaction because it is the banks that should know whether transactions of their clients are questionable or not.
Among the factors that pertains to suspicious transactions include those that have no underlying legal or trade obligation, purpose or economic justification; those involving clients who are not properly identified; and if the amount involved is not commensurate with the business or financial capacity of the client.
In the case of the transactions coursed through the RCBC Jupiter branch on February 4, 2016, the four accounts that were opened in May 2015 were inactive until it received the funds from the Federal Reserve of New York.
The money was sent to the account of one Michael Francisco Cruz, which received USD 6 million; Jessie Christopher Lagrosas, USD 30 million; Alfred Santos Vergara, USD 19.99 million; and Enrico Teodoro Vasquez, USD 25 million.
Bacay said this should made bank officials suspicious about the transaction.
The BSP learned of the alleged money laundering only on February 11, after BB asked for BSP Governor Amando Tetangco Jr.'s assistance to recover the stolen money.
Bacay said they started the investigation on February 12 but only got a freeze order against suspected bank accounts only on March 1, due to several factors like holidays and weekends as well as following the correct processes.
Amidst the alleged money laundering involving a Philippine-based universal bank and a remittance company, Bacay stressed that the country's AMLA remains firm.
She, however, said that amendments like inclusion of casinos and real estate agents as among the covered entities are needed to further strengthen the law.
She also said that absolute lifting of the bank secrecy law will further help the country's anti-money laundering system.
"Absolute (lifting) will be better," she said but admitted that they "will face an uphill battle" to achieve this.(PNA)