Aquino administration not backing yet calls for easing of bank secrecy laws

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THE Aquino administration says it is not supporting just yet calls for the easing of bank secrecy laws, despite the $81-million dirty money wired to the RCBC Branch on Jupiter St., in Metro Manila’s Makati City, an amount stolen from the Bangladesh central bank account with the Federal Reserve of New York.

This develops following recommendations by the Philippine central bank, Bangko Sentral ng Pilipinas (BSP), and the Bureau of Internal Revenue (BIR) that the bank secrecy laws be eased or lifted following the heist, where the stolen money was laundered through the country casinos and banking systems.

“The recommendations from the Bangko Sentral are not very specific at the moment,” Presidential Communications Undersecretary Manolo Quezon III said, adding that these have yet to be finalized with the Philippine and foreign authorities, and that the Senate is still conducting an investigation into the heist.

In a radio interview, Quezon noted that the BSP has asked only that the rules should be stricter. “The Aquino administration and our lawmakers, of course, will wait for the specific recommendations.”


Bank-account holders in the country have absolute right to secrecy as to the details of their deposits in Philippine peso, unless in four circumstances: upon written permission of the depositor; in cases of impeachment; upon order of a competent court in cases of bribery or dereliction of duty of public officials, or unexplained wealth like plunder; and in cases where the money is the subject matter of litigation.

But if the deposits are in a foreign currency, the right of bank-account holders to secrecy is absolute under the Philippine foreign currency deposit law.

Quezon has agreed that the Philippine bank secrecy laws should be amended to address money laundering, considering that even Switzerland, a country that has valued so much the privacy of its bank-account holders for the longest time, is also mulling easing its bank secrecy laws by 2017.

“So far, there is a good example here – which is Switzerland,” he stressed. “They are very strict in protecting the account holders and their deposits. If we are going to follow their stance, I’m sure our lawmakers, the Department of Finance, the BIR, the BSP will be studying this closely, and we’ll learn something from their processes.”

He also said, “I do think there’s one real concern in anything about the bank secrecy law – which would be the security or safety of account holders and, bearing that in mind, I’m sure there will be proper safeguards for that.”

The Anti-Money Laundering Council (AMLC) filed on March 11 a complaint against four holders of RCBC accounts where the stolen $81 million was deposited and also against Maia Santos-Deguito, the bank’s manager in its Jupiter branch. The four account holders, however, were just named John Does since it was found that the identity documents used to open the said accounts were fictitious.

By March 15, the Court of Appeals issued a freeze order on those four RCBC accounts.

The AMLC also asked the help of the United States’ Federal Bureau of Investigation in connection with the multimillion-dollar heist, while the Bangladesh Embassy in Manila has sent communications to the Department of Foreign Affairs, asking it to facilitate their attendance in the Senate investigation.

“The government is taking this very seriously,” Quezon said. “The groundwork is being laid for future reforms that will further improve the system. Heads will roll, especially from the RCBC ranks.”

He added, “We  are working with everyone to ensure there is transparency, and we can prevent this from happening again.” LLANESCA PANTI

LP/BF

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