BSP strengthens measures vs terrorism funding

MANILA, Philippines — The Bangko Sentral ng Pilipinas (BSP) is enhancing the provisions on targeted sanctions related to terrorism, terrorism financing, proliferation of weapons of mass destruction and proliferation financing, as the country ramps up efforts to be removed from the gray list of global dirty money watchdog Financial Action Task Force.

In a draft circular, the BSP will amend certain provisions of the Manual of Regulations for Banks (MORB) and Manual of Regulations for Non-Bank Financial Institutions (MORNBFI).

Under the proposal, the provisions on compliance with the United Nations Security Council Resolution will be deleted.

Instead, the BSP said covered persons should adopt appropriate policies and procedures to implement targeted financial sanctions related to terrorism, terrorism financing, proliferation, and proliferation financial, including the freezing and unfreezing actions, as well as prohibitions from conducting transactions with designated persons.

With respect to designated persons under relevant binding terrorism related resolutions, including United Nations Security Council Resolution (UNSCR) 1373 pursuant to Article 41 of the UN Charter and the Anti-Terrorism, Act, covered persons are required to freeze without delay the property or funds that are in any way related to financing of terrorism or acts of terrorism, as well as property or funds of any person, group of persons, terrorist organization, or association, in relation to whom there is probable cause to believe that they are committing or attempting or conspiring to commit or participating in or facilitating the commission of financing of terrorism or acts of terrorism, as defined under the Terrorism Financing Prevention and Suppression Act of 2012 (TFPSA).

These include property or funds that are owned or controlled by the subject of designation and is not limited to those that are directly related or tied to a particular terrorist act, plot or threat, as well as those that are wholly or jointly owned or controlled, directly or indirectly by the subject of designation.

Others include those that are derived or generated from funds or other assets owned or controlled, directly or indirectly by the subject of designation, as well as of persons or entities acting on behalf or at the direction of the subject of designation.

The BSP said the same action would be applied for proliferation and proliferation financing, including the freezing within hours from the time that the designation and freeze order is published in the Anti-Money Laundering Council (AMLC) website, block or restrain specific properties or funds that are owned or controlled by a designated person from being transacted, converted, concealed, moved, or disposed, as well as prohibit any person or entity from making any funds or other assets available for the benefit of designated persons, unless licensed, authorized or otherwise notified in accordance with the relevant UNSCR.

Under the new rules, the BSP said covered persons should adopt risk-based measures to reinforce and complement the rule-based full implementation of the targeted financial sanction requirements, including sanctions policies and procedures, maintenance of sanctions database, sanctions screening procedures, disposition of matches and handling of freeze order as well as delisting and unfreezing.

In October, the Paris-based FATF decided to retain the Philippines in the list of jurisdictions under increased monitoring as the country failed anew to address strategic deficiencies in its regimes to counter money laundering, terrorist financing and proliferation financing.

After it was included in the gray list anew more than a year ago, the Philippines has worked vigorously to address the deficiencies to meet the January 2023 deadline set by the FATF.