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MANILA, Philippines – The Philippines’ main gatekeeper against money laundering has filed a complaint against officers of PhilRem Service Corporation, which it said served as the “cleaning house” in the $81-million Bangladesh Bank fund heist.
On Thursday, April 28, the Anti-Money Laundering Council (AMLC) filed a complaint before the Department of Justice (DOJ) against PhilRem president Salud Bautista, chairman and treasurer Michael Bautista, and AML Compliance Officer Anthony Pelejo for violating the Anti-Money Laundering Act (AMLA).
Among the AMLA violations are failure to file covered transaction report as well as knowledge, conversion, use, and possession of the illicit funds, the AMLC told the DOJ.
“PhilRem, acting as a remittance agent, actually commingled the funds and acted as a cleaning house. PhilRem’s role was to make it extremely difficult to trace the source and flow of the funds by avoiding all anti-money laundering measures set by laws and regulations,” the complaint filed by AMLC read.
Hackers broke into Bangladesh Bank’s account with the Federal Reserve Bank of New York on February 4, ordering 35 transfers worth $951 million, bulk of which were to be transferred to the Rizal Commercial Banking Corporation (RCBC) Jupiter branch.
The Federal Reserve Bank did not execute 30 of the 35 transfers due to “lack of details.” But $81 million of the $951 million found its way to fake RCBC accounts. (READ: TIMELINE: Tracing the $81-million stolen fund from Bangladesh Bank)
Money was then consolidated and deposited in a dollar account under the name of William So Go of DBA Centurytex Trading, which was opened on the same day.
From Go’s account, the alleged stolen funds were moved to money transfer company PhilRem.
According to Pelejo, PhilRem made the following transactions as instructed by Go, which was later denied by the businessman:
The AMLC said the participation of PhilRem “is really to wash the funds and conceal the money trail. In fact, the funds could have been directly transferred from the bank account of Go to the bank accounts of the beneficiaries.”
“Transfer of the funds within the banking sector can easily be prevented or tracked. But the services of PhilRem, although unnecessary, are required to make it difficult, if not impossible, to follow its movements after the commingling of funds,” the AMLC said in its complaint.
This was only detected when Pelejo submitted a suspicious transaction report on February 17.
“Sometime towards the end of January 2016, PhilRem was referred to a certain William Go, who was doing business under the name Centurytex Trading, for possible remittance deal. Mr Go incidentally keeps an account with RCBC Jupiter (Business Center),” the transaction report read.
“He needed to remit Philippine peso equivalent of his US dollars to the casino market to take advantage of the heavy influx in the country of Chinese players, mostly in junkets, during the long weekend leading to the Chinese New Year (February 8),” Pelejo added in PhilRem’s report.
In its complaint against PhilRem, the AMLC also said the Bautistas failed to file the mandatory covered transaction reports (CTRs) for the remittances they processed from Go to Kim Wong in the total amount of $13.51 million covering a total of 4 transactions from February 5 to February 14.
AMLC said the foregoing circumstances showed that the Bautistas were aware that the funds were not legitimate when they deliberately ignored the AMLA requirements to know the customer and to record customer information.
“Had they done so, respondent spouses would have personally interviewed the real William Go and discover that the latter was not aware of the existence of the RCBC Account Nos. 9016455240 and 9010270206,” AMLC added. (READ: Ex-S&R owner to sue RCBC manager over heist)
PhilRem even converted and transacted the $81-million stolen funds with another fictitious account, Centurytex, “to make it appear that the spouses and PhilRem were dealing with a business entity, rather than with an individual.”
The Bureau of Internal Revenue on Thursday, April 21, filed a P35.61-million tax evasion complaint against PhilRem. — Rappler.com