Between a rock and a hard place

A serious matter seems to be overlooked while the impeachment of SC Chief Justice Renato Corona is going on at the Senate.

This is the need to pass a stronger version of the current Anti-Money Laundering Act (AMLA) and avoid 

FATF logo

blacklisting of the country by the international anti-money laundering watchdog, the Paris-based Financial Action Task Force (FATF).  

The deadline for such action, December 31, 2011, has actually passed us by.

Overseas Filipino Workers (OFWs)

The FATF blacklisted the Philippines in 2000 causing great inconvenience for

Bankers Association of the Philippines (BAP) logo

overseas Filipino workers (OFWs), commercial banks and other money transfer firms.  If a country was blacklisted by the FATF, OFWs remitting money will have to pay additional charges because of additional paper work.  The increase in transactions costs will also apply to banks and other financial firms.

In response to the great outcry over the blacklist, Congress enacted the country’s first anti-money laundering law and created the Anti-Money Laundering Council (AMLC) to implement the law.  However, the law was not acceptable to the FATF since it provided for a large monetary ‘red flag’ threshold.  A ‘red flag’ threshold is the amount in an account that warrants the AMLC’s investigation.  It was soon lowered to half a million pesos (P0.5 million) to the FATF’s satisfaction.

 

Anti-Money Laundering Council (AMLC) logo

However, the FATF now wants a tougher anti-money laundering law.

Accordingly, a new version of a FATF-compliant AMLA has been passed by the House of the Representatives.

House Bill 4275 expands the definition of money laundering and the list of crimes and institutions covered by the law.

The Senate as an impeachment court vs. CJ Renato Corona

The ball is now with the Senate currently engaged in impeaching SC chief justice Corona.  The impeachment has gone on since January and senators earlier nixed plans to have all-day impeachment proceedings.  

At some point, Senate President Juan Ponce Enrile complained that AMLC personnel seemed to be complicit in the leakage of Corona’s bank deposit records from the PS Bank Katipunan branch. This is interpreted by some as a sign that the Senate will balk at or may not be rushed to pass a new AMLA.

Will the senators have enough time and resolve to pass a tougher AMLA? Or should we brace for new sanctions from the FATF?