Senate rushes passage of AMLA amendments

MANILA, Philippines - The Senate tried to rush the passage of amendments to the Anti-Money Laundering Act (AMLA) last night, but after hours of debates, voting was deferred for today’s session.

The body, however, approved on second reading a bill that seeks to prevent and suppress terrorist financing.

Both the AMLA amendments and the terrorism bills were certified as urgent by President Aquino in light of a threat by the Financial Action Task Force to place the Philippines on its black list if the country fails to pass the measures when the Paris-based FATF holds its plenary session on June 18 in Rome.

Senate Bill 3127, or the proposed terrorism financing prevention and suppression act, seeks to cut the lifeline of terrorists by going after its financiers.

Senate Bill 3009, on the other hand, is one of two bills that would amend the AMLA, specifically by allowing the AMLC to inquire ex-parte into the accounts of persons when there is probable cause that the funds therein are related to money laundering or an unlawful activity or a predicate crime.

Senator Teofisto Guingona III, the sponsor of the bill, said that this proposal “is necessary in light of a lamentable decision of our Supreme Court which ruled that before the Anti-Money Laundering Council can look into an account, it would have to inform the concerned person: a de parte inquiry.”

“As a result, once informed, many have resorted to emptying out their bank accounts before the government can inquire into them. Logic and necessity demand that we allow for an ex parte inquiry,” Guingona said.

The same bill would also empower the AMLC to inquire into the main account and the related accounts, defined as “other bank deposits, investments, or other monetary instruments, owned or controlled by the person whose account is the subject of freeze order, or the funds of which originated from, or were transferred to, such account.”

A third measure, Senate Bill 3213, seeks to broaden the coverage of the AMLA by expanding the list of covered institutions and persons. But this was not tackled during yesterday’s session.

Senate Bills 3213 and 3009 were actually split from a singular bill that was passed by the House of Representatives to amend the AMLA.

If the two other bills are approved today, then the delegations of the Senate and the House of Representatives to the bicameral conference committee would be able to hold a meeting in the evening to reconcile the conflicting versions of their respective bills.

If they are able to conclude this by Wednesday morning, then the reconciled versions could be ratified by both chambers and the bills can then be transmitted to the President for signing into law.

The Asia/Pacific Group on Money Laundering, through its executive secretary Gordon Hook, confirmed this in his letter to Bangko Sentral ng Pilipinas Governor Amando Tetangco last May 18.

“If the Philippines has not taken sufficient action to implement significant components of its action plan by June 2012 (in particular the enactment of the AML amendments and the TF legislation currently before Congress), the FATF will in all likelihood, progress the Philippines to the FATF black list and call upon members to consider the risks arising from the AML/CFT deficiencies in your country,” Hook said.

“The effect of the Philippines being blacklisted would be very serious… On behalf of the APG as a whole, we strongly encourage the Philippines to enact the two bills referred to prior to the next meeting on the FATF in late June,” he added.

The Philippines is currently in the dark grey list of the FATF and if the organization is not satisfied with the progress of the Philippines in addressing its AML/CFT deficiencies, then it would place the country in its black list.

Executive Secretary Paquito Ochoa Jr. wrote a letter to Senate President Juan Ponce Enrile last March calling for immediate action on the AMLA amendment bill and the terrorist financing suppression bill.

According to Ochoa, countries included in the black list jurisdiction will be subjected to financial sanctions by the international community, which would result in delayed OFW remittances, higher charges and intermediation costs on financial transactions of Philippine banks and citizens and thorough scrutiny of Philippine-based transactions, among others.