Senate to ease bank secrecy law vs terrorism, corruption

MANILA, Philippines - The Senate is headed toward amending or repealing the bank secrecy law as a means to counter terrorism and corruption as well as promote transparency in government, Sen. Francis Escudero said yesterday.

The Senate committee on banks, financial institutions and currencies, which Escudero chairs, heard yesterday several bills to amend the bank secrecy law or Republic Act 1405. Officials from the Bangko Sentral ng Pilipinas (BSP), Bankers Association of the Philippines (BAP), Rural Bankers Association of the Philippines and the Anti-Money Laundering Council (AMLC) attended the hearing.

“We’ll relax or repeal that (bank secrecy law) – definitely the direction is headed towards that. So the law can’t be used for terrorism, can’t be used by criminals and by those abusive and thieves in government or in the private sector,” Escudero told reporters after the hearing.

He said in case the law will just be amended, private individuals may be covered under specific cases only – like when one is seeking a compromise in tax arrears, or in estate cases when bank deposits of a deceased need to be uncovered.

He said the Senate may also pass a law that would mandate all government officials to sign a waiver in favor of the BSP, Bureau of Internal Revenue, Securities and Exchange Commission and the Office of the Ombudsman when filing their statements of assets, liabilities and net worth.

During the hearing, BSP Governor Amando Tetangco Jr. backed the proposed amendments to counter money laundering. He said there are only two countries in the world with bank secrecy laws – the Philippines and Lebanon.

BAP managing director Cesar Virtucio, however, said Switzerland also has one, which it expects to repeal next year anyway.

Exclude public officials?

One of the amendments proposed by Senators Panfilo Lacson and Leila de Lima and Senate President Aquilino Pimentel III was to exclude government officials from the law.

Lacson also filed a separate bill seeking to allow authorities to examine bank accounts of suspected drug pushers and their financiers.

“The concern is really that since many countries have already lifted their bank secrecy regulations, the Philippines might attract dirty money or laundered money because of the existence of bank secrecy laws here,” Tetangco said.