anti money laundering
anti money laundering
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SECTION 1.
Short Title. -This Act shall be known as the
"Anti-Money Laundering Act of 2001.”
SEC. 2.
Declaration of Policy. - It is hereby declared the
policy of the State to protect and preserve the integrity and
confidentiality of bank accounts and to ensure that the Philippines
shall not be used as a money laundering site for the proceeds of any
unlawful activity. Consistent with its foreign policy, the State
shall extend cooperation in transnational investigations and
prosecutions of persons involved in money laundering activities
wherever committed.
SEC. 3.
Definitions. - For purposes of this Act, the
following terms are hereby defined as follows:
(a) "Covered
Institution" refers to: (1) banks, non-banks, quasi-banks, trust entities, and all other institutions and their subsidiaries and affiliates supervised or regulated by the Bangko Sentral ng Pilipinas (BSP);
(2) insurance
companies and all other institutions supervised or regulated by the
Insurance Commission; and
(3) (i) securities
dealers, brokers, salesmen, investment houses and other similar
entities managing securities or rendering services as investment
agent, advisor, or consultant, (ii) mutual funds, close and
investment companies, common trust funds, pre-need companies and
other similar entities, (iii) foreign exchange corporations, money
changers, money payment, remittance, and transfer companies and
other similar entities, and (iv) other entities administering or
otherwise dealing in currency, commodities or financial derivatives
based thereon, valuable objects, cash substitutes and other similar
monetary instruments or property supervised or regulated by
Securities and Exchange Commission.
(b) "Covered
transaction" is a single, series, or combination of
transactions involving a total amount in excess of Four million
Philippine pesos (Php4,000,000.00) or an equivalent amount in
foreign currency based on the prevailing exchange rate within five
(5) consecutive banking days except those between a covered
institution and a person who, at the time of the transaction was a
properly identified client and the amount is commensurate with the
business or financial capacity of the client; or those with an
underlying legal or trade obligation, purpose, origin or economic
justification.
It likewise refers to
a single, series or combination or pattern of unusually large and
complex transactions in excess of Four million Philippine pesos
(Php4,000,000.00) especially cash deposits and investments having no
credible purpose or origin, underlying trade obligation or contract.
(c) "Monetary
instrument" refers to: (1) coins or currency of legal tender of the Philippines, or of any other country; (2) drafts, checks and notes;
(3) securities or
negotiable instruments, bonds, commercial papers, deposit
certificates, trust certificates, custodial receipts or deposit
substitute instruments, trading orders, transaction tickets and
confirmations of sale or investments and money marked instruments;
and
(4) other similar
instruments where title thereto passes to another by en- dorsement,
assignment or delivery.
(d) "Offenders”
to any person who commits a money laundering offense.
(e) "Person"
refers to any natural or juridical person.
(f) "Proceeds"
refers to an amount derived or realized from an unlawful
activity.
(g) "Supervising
Authority" refers to the appropriate supervisory or
regulatory agency, department or office supervising or regulating
the covered institutions enumerated in Section 3(a).
(h) "Transaction"
refers to any act establishing any right or obligation or giving
rise to any contractual or legal relationship between the parties
thereto. It also includes any movement of funds by any means with a
covered institution.
(i) "Unlawful
activity" refers to any act or omission or series or
combination thereof involving or having relation to the following:
(1) Kidnapping for
ransom under Article 267 of Act No.3815, otherwise known as the
Revised Penal Code, as amended;
(2) Sections
3,4,5,7,8 and 9 of Article Two of Republic Act No.6425, as amended,
otherwise known as the Dangerous Drugs Act of 1972;
(3) Section 3
paragraphs B,C,E,G,H and I of Republic Act No.3019, as amended;
otherwise known as the Anti-Graft and Corrupt Practices Act;
(4) Plunder under
Republic Act No.7080, as amended;
(5) Robbery and
extortion under Articles 294,295,296,299,300,301 and 302 of the
Revised Penal Code, as amended;
(6) Jueteng and
Masiao punished as illegal gambling under Presidential Decree
No.1602;
(7) Piracy on the
high seas under the Revised Renal Code, as amended and Presidential
Decree No.532;
(8) Qualified theft
under Article 310 of the Revised Penal Code, as amended; (9)
Swindling under Article 315 of the Revised Penal Code, as amended;
(10) Smuggling under
Republic Act Nos. 455 and 1937;
(11) Violations under
Republic Act No.8792, otherwise known as the Electronic Commerce Act
of 2000;
(12) Hijacking and
other violations under Republic Act No.6235; destructive arson and
murder, as defined under the Revised Penal Code, as amended,
including those perpetrated by terrorists against non-combatant
persons and similar targets;
(13) Fraudulent
practices and other violations under Republic Act No.8799. otherwise
known as the Securities Regulation Code of 2000;
(14) Felonies or
offenses of a similar nature that are punishable under the penal
laws of other countries.
SEC. 4. Money
Laundering Offense. -Money laundering is a crime
whereby the proceeds of an unlawful activity are transacted, thereby
making them appear to have originated from legitimate sources. It is
committed by the following:
(a) Any person
knowing that any monetary instrument or property represents.
involves, or relates to the proceeds of any unlawful activity,
transacts or attempts to transact said monetary instrument or
property.
(b) Any
person-knowing that any monetary instrument or property involves the
proceeds of any unlawful activity, performs or fails to perform any
act as a result of which he facilitates the offense of money
laundering referred to in paragraph (a) above.
(c) Any person
knowing that any monetary instrument or property is required under
this Act to be disclosed and filed with the Anti-Money Laundering
Council (AMLC), fails to do so.
SEC. 5.
Jurisdiction of Money Laundering Cases. -The regional
trial courts shall have jurisdiction to try all cases on money
laundering. Those committed by public officers arid private persons
who are in conspiracy with such public officers shall be under the
jurisdiction of the Sandiganbayan.
SEC. 6.
Prosecution of Money Laundering. –
(a) Any person may be
charged with and convicted of both the offense of money laundering
and the unlawful activity as herein defined.
(b) Any proceeding
relating to the unlawful activity shall be given precedence over the
prosecution of any offense or violation under this Act without
prejudice to the freezing and other remedies provided.
SEC. 7.
Creation of Anti-Money Laundering Council (AMLC).
–The Anti-Money Laundering Council is hereby created and shall be
composed of the Governor of the Bangko Sentral ng Pilipinas as
chairman, the Commissioner of the Insurance Commission and the
Chairman of the Securities and Exchange Commission as members. The
AMLC shall act unanimously in the discharge of its functions as
defined hereunder:
(1) to
require and receive covered transaction reports from covered
institutions;
(2) to issue orders addressed to the appropriate Supervising Authority or the covered institution to determine the true identity of the owner of any monetary instrument or property subject of a covered transaction report or request for assistance from a foreign State, or believed by the Council, on the basis of substantial evidence to be in whole or in part, wherever located, representing, involving. or related to, directly or indirectly, in any manner or by any means. the proceeds of an unlawful activity;
(3) to institute
civil forfeiture proceedings and all other remedial proceedings
through the Office of the Solicitor General;
(4) to cause the
filing of complaints with the Department of Justice or the
Ombudsman for the prosecution of money laundering offenses;
(5) to initiate
investigations of covered transactions, money laundering activities
and other violations of this Act;
(6) to freeze any
monetary instrument or property alleged to be proceed of any
unlawful activity; (7) to implement such measures as may be necessary and justified under this Act to counteract money laundering;
(8) to receive and
take action in respect of, any request from foreign states for
assistance in their own anti-money laundering operations provided in
this Act;
(9) to develop
educational programs on the pernicious effects of money laundering,
the methods and techniques used in money laundering, the viable
means of preventing money laundering and the effective ways of
prosecuting and punishing offenders; and
(10) to enlist the
assistance of any branch, department, bureau, office, agency or
instrumentality of the government, including government-owned and
-controlled corporations, in undertaking any and all anti-money
laundering operations, which may include the use of its personnel,
facilities and resources for the more resolute prevention, detection
and investigation of money laundering offenses and prosecution of
offenders.
SEC. 8.
Creation of a Secretariat. -The AMLC is hereby
authorized to establish a secretariat to be headed by an Executive
Director who shall be appointed by the Council for a term of five
(5) years. He must be a member of the Philippine Bar, at least
thirty-five (35) years of age and of good moral character,
unquestionable integrity and known probity. All members of the
Secretariat must have served for at least five (5) years either in
the Insurance Commission, the Securities and Exchange Commission or
the Bangko Sentral ng Pilipinas (BSP) and shall hold full-time
permanent positions within the BSP.
SEC. 9.
Prevention of Money Laundering; Customer Identification Requirements
and Record Keeping. - (a) Customer
Identification. - Covered institutions shall establish and
record the true identity of its clients based on official documents.
They shall maintain a system of verifying the true identity of their
clients and, in case of corporate clients, require a system of
verifying their legal existence and organizational structure, as
well as the authority and identification of all persons purporting
to act on their behalf.
The provisions of
existing laws to the contrary notwithstanding, anonymous accounts,
accounts under fictitious names, and all other similar accounts
shall be absolutely prohibited. Peso and foreign currency
non-checking numbered accounts shall be allowed. The BSP may conduct
annual testing solely limited to the determination of the existence
and true identity of the owners of such accounts.
(b) Record
Keeping. -All records of all transactions of covered
institutions shall be maintained and safely stored for five (5)
years from the date of transactions. With respect to closed
accounts, the records on customer identification, account files and
business correspondence, shall be preserved and safely stored for at
least five (5) years from the dates when they were closed.
(c) Reporting
of Covered Transactions. - Covered institutions shall report
to the AMLC all covered transactions within five (5) working days
from occurrence thereof, unless the Supervising Authority concerned
prescribes a longer period not exceeding ten (10) working days.
When reporting
covered transactions to the AMLC, covered institutions and their
officers, employees, representatives, agents, advisors, consultants
or associates shall not be deemed to have violated Republic Act No.
1405, as amended; Republic Act No. 6426, as amended; Republic Act
No. 8791 and other similar laws, but are prohibited from
communicating, directly or indirectly, in any manner or by any
means, to any person the fact that a covered transaction report was
made, the contents thereof, or any other information in relation
thereto. In case of violation thereof, the concerned officer,
employee, representative, agent, advisor, consultant or associate of
the covered institution, shall be criminally liable. However, no
administrative, criminal or civil proceedings, shall lie against any
person for having made a covered transaction report in the regular
performance of his duties and in good faith, whether or not such
reporting results in any criminal prosecution under this Act or any
other Philippine law.
When reporting
covered transactions to the AMLC, covered institutions and their
officers, employees, representatives, agents, advisors, consultants
or associates are prohibited from communicating, directly or
indirectly, in any manner or by any means, to any person, entity,
the media, the fact that a covered transaction report was made, the
contents thereof, or any other information in relation thereto.
Neither may such reporting be published or aired in any manner or
form by the mass media, electronic mail, or other similar devices.
In case of violation thereof, the concerned officer, employee,
representative, agent, advisor, consultant or associate of the
covered institution, or media shall be held criminally liable.
SEC. 10.
Authority to Freeze. - Upon determination that
probable cause .exists that any deposit or similar account is in any
way related to an unlawful activity, the AMLC may issue a freeze
order, which shall be effective immediately, on the account for a
period not exceeding fifteen (15) days. Notice to the depositor that
his account has been frozen shall be issued simultaneously with the
issuance of the freeze order. The depositor shall have seventy-two
(72) hours upon receipt of the notice to explain why the freeze
order should be lifted. The AMLC has seventy-two (72) hours to
dispose of the depositor's explanation. If it fails to act within
seventy-two (72) hours from receipt of the depositor’s explanation,
the freeze order shall automatically be dissolved. The fifteen
(15)-day freeze order of the AMLC may be extended upon order of the
court, provided that the fifteen (15)-day period shall be tolled
pending the court's decision to extend the period.
No court shall issue
a temporary restraining order or writ of injunction against any
freeze order issued by the AMLC except the Court of Appeals or the
Supreme Court.
SEC. 11.
Authority to Inquire into Bank Deposits. -
Notwithstanding the provisions of Republic Act No. 1405, as amended;
Republic Act No. 6426, as amended; Republic Act No. 8791, and other
laws, the AMLC may inquire into or examine any particular deposit or
investment with any banking institution or non- bank financial
institution upon order of any competent court in cases of violation
of this Act when it has been established that there is probable
cause that the deposits or investments involved are in any way
related to a money laundering offense: Provided, That
this provision shall not apply to deposits and investments made
prior to the effectivity of this Act.
SEC. 12.
Forfeiture Provisions. –
(a) Civil
Forfeiture. - When there is a covered transaction report
made, and the court has, in a petition filed for the purpose ordered
seizure of any monetary instrument or property, in whole or
in part, directly or indirectly, related to said report, the Revised
Rules of Court on civil forfeiture shall apply.
(b) Claim on
Forfeited Assets. - Where the court has issued an order of
forfeiture of the monetary instrument or property in a criminal
prosecution for any money laundering offense defined under
Section 4 of this Act, the offender or any other person claiming an
interest therein may apply, by verified petition, for a declaration
that the same legitimately belongs to him and for segregation or
exclusion of the monetary instrument or property corresponding
thereto. The verified petition shall be filed with the court which
rendered the judgement of conviction and order of forfeiture, within
fifteen (15) days from the date of the order or forfeiture, in
default of which the said order shall become final and executory.
This provision shall apply in both civil and criminal forfeiture.
(c) Payment in
Lieu of Forfeiture. - Where the court has issued an order of
forfeiture of the monetary instrument or property subject of a money
laundering offense defined under Section 4, and said order cannot be
enforced because any particular monetary instrument or property
cannot, with due diligence, be located, or it has been substantially
altered, destroyed, diminished in value or otherwise rendered
worthless by any act or omission, directly or indirectly,
attributable to the offender, or it has been concealed, removed,
converted or otherwise transferred to prevent the same from being
found or to avoid forfeiture thereof, or it is located outside the
Philippines or has been placed or brought outside the jurisdiction
of the court, or it has been commingled with other monetary
instruments or property belonging to either the offender himself or
a third person or entity, thereby rendering the same difficult to
identify or be segregated for purposes of forfeiture, the court may,
instead of enforcing the order of forfeiture of the monetary
instrument or property or part thereof or interest therein,
accordingly order the convicted offender to pay an amount equal to
the value of said monetary instrument or property. This provision
shall apply in both civil and criminal forfeiture,
SEC. 13. Mutual
Assistance among States. –
(a) Request for
assistance from a Foreign State. - Where a foreign State
makes a request for assistance in the investigation or prosecution
of a money laundering offense, the AMLC may execute the request or
refuse to execute the same and inform the foreign State of any valid
reason for not executing the request or for delaying the execution
thereof. The principles of mutuality and reciprocity shall, for this
purpose, be at all times recognized. "
(b) Power of
the AMLC to Act on a Request for Assistance from a Foreign State.
- The AMLC may execute a request for assistance from a foreign State
by: (1) tracking down, freezing, restraining and seizing
assets alleged to be proceeds of any unlawful activity under the
procedures laid down in this Act; (2) giving information needed by
the foreign State within the procedures laid down in this Act; and
(3) applying for an order of forfeiture of any monetary instrument
or property in the court: Provided, That the court shall not
issue such an order unless the application is accompanied by
an authenticated p copy of the order of a court in the requesting
State ordering the forfeiture of said monetary instrument or
property of a person who has been convicted of a money
laundering offense in the requesting State, and a certification of
an affidavit of a competent officer of the requesting State stating
that the conviction and the order of forfeiture are final and then
no further appeal lies in respect or either.
(c) Obtaining
Assistance from Foreign States. -The AMLC may make a request
to any foreign State for assistance in (1) tracking down, freezing,
re- straining and seizing assets alleged to be proceeds of any
unlawful activity; (2) obtaining information that it needs relating
to any covered transaction, money laundering offense or any other
matter directly or indirectly, related thereto; (3) to the extent
allowed by the law of the Foreign State, applying with the
proper court therein for an order to enter any premises belonging to
or in the possession or control of, any or all of the persons named
in said request, and/or search any or all such persons named therein
and/or remove any document, material or object named in said
request: Provided, That the documents accompanying the
request in support of the application have been duly authenticated
in accordance with the applicable jaw or regulation of the foreign
State; and (4) applying for an order of forfeiture of any monetary
instrument or property in the proper court in the foreign State:
Provided, That the request is accompanied by an authenticated
copy of the order of the regional trial court ordering the
forfeiture of said monetary instrument or property of a convicted
offender and an affidavit of the clerk of court stating that the
conviction and the order of forfeiture are final and that no further
appeal " lies in respect of either.
(d) Limitations
on Request for Mutual Assistance. – The AMLC may refuse to
comply with any request for assistance where the action sought by
the request contravenes any provision of the Constitution or the
execution of a request is likely to prejudice the national interest
of the Philippines unless therein is a treaty between the
Philippines and the requesting State relating to the provision of
assistance in relation to money laundering offenses.
(e)
Requirements for Requests for Mutual Assistance from Foreign
States. - A request for mutual assistance from a foreign
State must (1) confirm that an investigation or prosecution is being
conducted in respect of a money launderer named therein or that he
has been convicted of any money laundering offense; (2) state the
grounds on which any person is being investigated or prosecuted for
money laundering or the details of his conviction; (3) gives
sufficient particulars as to the identity of said person; (4) give
particulars sufficient to identify any covered institution believed
to have any information, document, material or object which may be
of assistance to the investigation or prosecution; (5) ask from the
covered institution concerned any information, document, material or
object which may be of assistance to the investigation or
prosecution; (6) specify the manner in which and to whom said
information, document, material or object detained pursuant to said
request, is to be produced; (7) give all the particulars necessary
for the issuance by the court in the requested State of the writs,
orders or processes needed by the requesting State; and (8) contain
such other information as may assist in the execution of the
request.
(f)
Authentication of Documents. - For purposes of this Section,
a document is authenticated if the same is signed or certified by a
judge, magistrate or equivalent officer in or of, the requesting
State, and authenticated by the oath or affirmation of a witness or
sealed with an official or public seal of a minister, secretary of
State, or officer in or of, the government of the requesting State,
or of the person administering the government or a department of the
requesting territory, protectorate or colony. The certificate of
authentication may also be made by a secretary of the embassy or
legation, consul general, consul, vice consul, consular agent or any
officer in the foreign service of the Philippines stationed in the
foreign State in which the record is kept, and authenticated by the
seal of his office.
(g)
Extradition. -The Philippines shall negotiate for the
inclusion of money laundering offenses as herein defined among
extraditable offenses in all future treaties.
SEC. 14. Penal
ProvisIons. -(a) Penalties for the Crime of
Money Laundering. The penalty of imprisonment ranging from
seven (7) to fourteen (14) years and a fine of not less than Three
million Philippine pesos (Php , 3,000,000.00) but not more than
twice the value of the monetary instrument or property involved in
the offense, shall be imposed upon a person convicted under Section
4(a) of this Act.
The penalty of
imprisonment from four (4) to seven (7) years and a fine of not less
than One million five hundred thousand Philippine pesos (Php
1,500,000.00) but not more than Three million Philippine pesos (Php
3,000,000.00), shall be imposed upon a person convicted under
Section 4(b) of this Act.
The penalty of
imprisonment from six (6) months to four (4) years or a fine of not
less than One hundred thousand Philippine pesos (Php 100,000.00) but
not more than Five hundred thousand Philippine pesos (Php
500,000.00), or both, shall be imposed on a person convicted under
Section 4(c) of this Act.
(b) Penalties
for Failure to Keep Records. The penalty of imprisonment
from six (6) months to one (1) year or a fine of not less than One
hundred thousand Philippine pesos (Php100,000.00) but not more than
Five hundred thousand Philippine pesos (Php500,000.00), or both,
shall be imposed on a person convicted under Section 9(b) of this
Act.
(c) Malicious
Reporting. Any person who, with malice, or in bad faith,
report or files a completely unwarranted or false information
relative to money laundering transaction against any person shall be
subject to a penalty of six (6) months to four (4) years
imprisonment and a fine of not less than One hundred thousand
Philippine pesos (Php 100,000.00) but not more than Five hundred
thousand Philippine pesos (Php500,000.00), at the discretion of the
court: Provided, That the offender is not entitled to
avail the benefits of the Probation Law.
If the offender is a
corporation, association, partnership or any juridical per- son, the
penalty shall be imposed upon the responsible officers, as the case
may be, who participated in the commission of the crime or who shall
have knowingly permitted or failed to prevent its commission. If the
offender is a juridical person, the court may suspend or revoke its
license. If the offender is an alien, he shall, in addition to the
penalties herein prescribed, be deported without further proceedings
after serving the penalties herein prescribed. If the offender is a
public official or employee, he shall, in addition to the penalties
prescribed herein, suffer perpetual or temporary absolute
disqualification from office, as the case may be.
Any public official
or employee who is called upon to testify and refuses to do the same
or purposely fails to testify shall suffer the same penalties
prescribed herein.
(d) Breach of
Confidentiality. The punishment of imprisonment ranging from
three (3) to eight (8) years and a fine of not less than Five
hundred thousand Philippine pesos (Php 500,000.00) but not more than
One million Philippine pesos (Php 1,000,000.00), shall be imposed on
a person convicted for a violation under Section 9 (c).
SEC. 16.
Prohibitions Against Political Harassment. -This Act
shall not be used for political prosecution or harassment or as an
instrument to hamper competition in trade and commerce.
No case for money
laundering may be filed against and no assets shall be frozen,
attached or forfeited to the prejudice of a candidate for an
electoral office during an election period.
SEC. 17.
Restitution. -Restitution for any aggrieved party
shall be governed by the provisions of the New Civil Code.
SEC. 18.
Implementing Rules and Regulations. - Within thirty
(30) days from the effectivity of this Act, the Bangko Sentral ng
Pilipinas, the Insurance Commission and the Securities and Exchange
Commission shall promulgate the rules and regulations to implement
effectively the provisions of this Act. Said rules and regulations
shall be submitted to the Congressional Oversight Committee for
approval.
Covered institutions
shall formulate their respective money laundering prevention
programs in accordance with this Act including, but not limited to,
information dissemination on money laundering activities and its
prevention, detection and reporting, and the training of responsible
officers and personnel of covered institutions.
SEC. 19.
Congressional Oversight Committee. - There is hereby
created a Congressional Oversight Committee composed of seven (7)
members from the Senate and seven (7) members from the House of
Representatives. The members from the Senate shall be appointed by
the Senate President based on the proportional representation of the
parties or coalitions therein with at least two (2) Senators
representing the minority. The members from the House of
Representatives shall be appointed by the Speaker also based on
proportional representation of the parties or coalitions therein
with at least two (2) members representing the minority.
The Oversight
Committee shall have the power to promulgate its own rules, to
oversee the implementation of this Act, and to review or revise the
implementing rules issued by the Anti-Money Laundering Council
within thirty (30) days from the promulgation of the said rules.
SEC. 20.
Appropriations Clause. - The AMLC shall be provided
with an initial appropriation of Twenty-five million Philippine
pesos (Php25,000,000.00) to be drawn from the national government.
Appropriations for the succeeding years shall be included in the
General Appropriations Act.
SEC. 21.
Separability Clause. - If any provision or section of
this Act or the application thereof to any person or circumstance is
held to be invalid, the other provisions or sections of this Act,
and the application of such provision or section to other persons or
circumstances, shall not be affected thereby.
SEC. 22.
RepeaIing Clause. - All laws, decrees, executive
orders, rules and regulations or parts thereof, including the
relevant provisions of Republic Act No. 1405, as amended; Republic
Act No. 6426, as amended; Republic Act No. 8791, as amended and
other similar laws, as are inconsistent with this Act, are hereby
repealed, amended or modified accordingly.
SEC. 23.
Effectivity. - This Act shall take effect fifteen
(15) days after its complete publication in the Official Gazette or
in at least two (2) national newspapers of general circulation.
The provisions of
this Act shall not apply to deposits and investments made prior to
its effectivity.
Approved
This Act which is a
consolidation of House Bill No. 3083 and Senate Bill No. 1745 was
finally passed by the House of Representatives and the Senate on
September 29, 2001.
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