BSP outlines new rules, penalties for money launderers

MANILA, Philippines – The Bangko Sentral ng Pilipinas (BSP) will impose stiffer penalties on individuals found to be guilty of money laundering.

BSP Deputy Governor Chuchi Fonacier issued Circular Letter 2017-048 earlier this month, outlining revised implementing rules as well as tougher sanctions for all BSP-supervised personnel found to have violated Republic Act 9160 or the Anti-Money Laundering Act (AMLA) of 2001.

The circular supersedes Anti-Money Laundering Council (AMLC) Resolution 51 released in 2007.

The new rules were designed "to ensure that the Philippines shall not be used as a money laundering site for the proceeds of any unlawful activity."

Under these new rules, the AMLC can impose penalty and non-penalty measures on BSP-supervised personnel, ranging from a fine, reprimand, or warning to "other measures as may be necessary and justified to prevent and counteract money laundering."

Fines, gravity of violations

The AMLC will determine the appropriate amounts for fines, which would be capped at P500,000 per violation. The total fine should also not exceed 5% of the asset size of the respondent.

The fines are classified based on the financial capability of covered persons:

Fines for micro covered persons range from P5,000 per violation for light cases to as much as P50,000 for grave offenses, while fines for the Large B category range from P50,000 to as high as P500,000 per violation.

The new rules also categorize the gravity of the violation – light, less serious, serious, major, and grave.

The grave cases involve pending money laundering investigations and prosecution of cases.

Major cases involve the total disregard of customer due diligence, record-keeping, or transaction reporting requirements.

Serious cases, meanwhile, involve those that have major impact on the AMLC's ability to prevent or counter money laundering and terrorism financing.

Less serious violations hamper or delay the exercise of the AMLC's compliance and investigation functions, while light violations involve cases that have no immediate impact on the discharge of the AMLC's mandate.

The Philippine financial system came under international scrutiny last year when $81 million stolen from the Bangladesh Bank was laundered through the Rizal Commercial Banking Corporation (RCBC), which was subsequently fined a record P1 billion by the BSP.

Earlier this year, casinos also officially become covered by the AMLA. –