Amendments to the anti-money laundering act (AMLA) may help to reduce or prevent the incidence of cybercrime in the country’s financial system, according to the current president of Financial Executives Institute of the Philippines (Finex).
George Chua, who is also the President and Chief Executive Officer of Bayan Automotive Industries Corp., noted there has been clamor for the amendment of the anti-money laundering law to include previously exempted institutions.
He said banks are already overburdened with so many reportorial requirements at present that it creates a lot of noise in the system, which leads to difficulty in identifying “red flags.”
Chua was one of the reactors during The Manila Times 4th Business Forum held at the Marriott Hotel in Pasay City on Wednesday, where he discussed two levels of cyberthreats, threats at the bank or institutional level and at the customer level.
“Because when you submit truckloads of documents, whether it is in digital or physical form, the people on the regulator side or the receiving end are also overly burdened by such reports, [and]I do not know how they plan to evaluate the information that they receive,” he explained.
Chua said it is now time for the government to seriously consider the AMLA amendments, saying that hopefully under the new administration “people will become more pragmatic and less bureaucratic.”
“Because if you ask for every bit of information, it is really very hard to sort through massive amounts of data. Unless you have the computing and manpower resources available for that, which we obviously don’t have,” he said.
Strengthening the AMLA
Proposed amendments to the AMLA have been made more urgent by recent financial controversies that have exploited the weakness in the country’s tax and financial system’s legal framework.
A proposal to strengthen the country’s AMLA transmitted was prepared jointly by the Department of Finance (DOF), the Money Laundering Council (AMLC), and the Bangko Sentral ng Pilipinas (BSP).
The proposed amendments will include casinos as mentioned in the Financial Action Task Force (FATF) recommendations. Tax evasion, among other crimes, will be included as a predicate crime to money laundering.
The proposal also seeks to improve the AMLC’s ability to safeguard the financial system from money laundering activities by authorizing the AMLC to issue subpoenas and freeze orders.
The bill also increases the monetary penalty for administrative sanctions.
Among the amendments is the designation of the BSP as the supervising authority over foreign exchange dealers, moneychangers, and remittance and money transfer businesses for purposes of the AMLA.