BSP Board okays changes in anti-money laundering rules

MANILA-- The Bangko Sentral ng Pilipinas' (BSP) policy-making Monetary Board (MB) has revised the regulations on anti-money laundering (AML) and terrorist financing (TF) in a bid to enhance measures against these crimes.

The measure, approved by the Board last Feb. 23 but released to media only Thursday, calls for a refined customer due diligence procedure and a practical way of sourcing official documents through the use of other reliable and independent source of data and information on customers.

It also introduced the concept of a "restricted account", formulated for the unbanked sector.

Under the restricted account clause, depositors must have a maximum annual total credits of Php 100,000 and "the account shall not be allowed to receive/send foreign remittances."

Identification requirements for people opening a restricted account is basically a valid identification card (ID) but sans this banks need to get the customer's complete name, birth date, source of funds, present and/or permanent address and nationality.

Banks also need to "ensure that it has in its records a clear photograph and signature or thumbprint of the customer."

The BSP, in a press release, said the enhanced anti-money laundering-combating the financing of terrorism (AML/CFT) regulations is among the "ongoing efforts to strengthen the financial system's safeguards against ML and TF balanced against the objective of also promoting financial inclusion of the unbanked."

Among the main factors used for the amendments are the latest revised implementing rules and regulations of the Anti-Money Laundering Act (AMLA) that took effect last January 7, the lessons learned from the recent ML/FT cases, the latest Financial Action Task Force (FATF) recommendations and guidance papers, specifically those that tackled the use of risk-based approach to AML/CFT standards and striking balance between financial integrity and financial inclusion.

"With the advent of new technologies in the financial system, the new rules recognize and allow the use of information and communication technology in the conduct of customer identification subject to implementation of appropriate measures to manage attendant risks," the BSP said.

"Finallly, to realize desired change towards effective implementation, escalation of supervisory enforcement action is introduced in cases of heightened AML/CFT supervisory concerns as reflected in the overall AML risk rating of the covered person," it said adding that covered persons are given six months upon the effectivity of this enhancement to update their AML/CFT policies.

The AML regulations of the manual of regulations for banks and manual regulations for non-bank financial institutions define "covered persons" as entities regulated by the central bank and these include banks, non-banks, quasi-banks (QBs), trust entities, non-stock savings and loans associations, pawnshops, foreign exchange dealers, money changers, remittance and transfer companies, electronic money issuers, and other financial institutions regulated by the BSP through special laws.

Source: Philippines News Agency