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Senator pushes bill on lifting bank secrecy for officials

Paolo Romero - The Philippine Star
Senator pushes bill on lifting bank secrecy for officials
Escudero said Republic Act (RA) 1405, or the Bank Secrecy Law, was enacted in 1955 to encourage people to deposit their money in banking institutions and discourage private hoarding as part of policies meant to promote economic development.
STAR / Boy Santos, file

MANILA, Philippines — Sen. Francis Escudero has sought the immediate approval of a bill that mandates all government officials and employees to waive their rights under the bank secrecy law.

Escudero said Republic Act (RA) 1405, or the Bank Secrecy Law, was enacted in 1955 to encourage people to deposit their money in banking institutions and discourage private hoarding as part of policies meant to promote economic development.

The law became more stringent in 1974 with the enactment of RA 6426, but it was more for foreign currency deposits.

Exceptions from the secrecy of bank deposits are quite limited and exclusive with RA 1405 having four and RA 6426 with only one, which treats foreign currency deposits with absolute confidentiality, according to the senator.

“The policy intent is quite tenable given that the above laws on bank deposits have passed the test of time and remained unchanged,” he said in his bill.

“However such intent has its own unintended consequences – this is when banks are used as institutions to hide illegal wealth, fund illegal activities, launder money, evade taxes and commit others financial crimes under a statutorily mandated secrecy,” he added.

Escudero explained that it is for these reasons that all countries, except the Philippines, have lifted the secrecy of bank deposits.

He said the government should spearhead the move of lifting secrecy by mandating its officials to waive their rights.

He added that such a move could mitigate graft and corruption in government.

“Verily, any person who has nothing to hide in secret would only welcome this proposal in the name of transparency and accountability,” he said.

BANK SECRECY LAW

SENATOR

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