Wednesday, June 06, 2007

Philippine Anti Money Laundering Law | AMLA

The Philippines is strengthening its laws on anti money laundering in compliance with international banking standards and criminalize money laundering. The scope and meaning of money laundering is broad, but it’s briefly defined as transactions that involve the conversion or transfer of money or proceeds to disguise its illicit or illegal origins and make it appear as coming from legitimate source. The activity is commonly attached to crime syndicates that accumulate enormous amount of money from illegal activities but now also includes terrorist, which uses the money to finance their operations.

Banks in the Philippines are now required to report any suspicious transactions involving large sums of money being moved around by individuals or organizations that appear to have questionable identities and source of funds. Like if a client declares to the bank he is unemployed but large sums of money are being deposited to his account weekly, this sends a clear signal that there is something fishy going on here and should be reported to the Anti-Money Laundering Council (AMLC) for further investigation and the freezing, seizure, forfeiture and recovery of dirty money or property.

But banks are not the only institutions covered by the AMLA. Insurance companies and all other institutions supervised or regulated by the Insurance Commission plus brokers, money changers, investment houses, mutual funds, pre-need companies, foreign exchange corporations, money
payment remittance and other institutions that is supervised and regulated by the Securities and Exchange Commission (SEC). These steps are necessary to ensure that legitimate financial institutions are not used as a place for illegal or unlawful activities such as kidnap for ransom, drug trafficking, smuggling, swindling, plunder and other illegal activities.

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