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Flashcards in RFBT - ANTI -MONEY LAUNDERING ACT OF 2001 Deck (48)
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1
Q

What is AMLA?

A

Anti-Money Laundering Act

2
Q

What is RA 9160?

A

“Anti-Money Laundering Act of 2001”

3
Q

What republic acts amended RA 9160?

A

RA 9194, 10167, and 10365.

4
Q

What is money laundering?

A

Money Laundering is a crime whereby the proceeds of an unlawful activity are transacted, thereby making them appear to have originated from legitimate sources.

5
Q

Al-amanah Bank failed to report to AMLC the covered and suspicious transaction of Abdullah. Is Al-amanah guilty of money laundering?

A

Yes, because money laundering is also committed by any covered person who, knowing that a covered or suspicious transaction is required under this Act to be reported to the Anti-Money Laundering Council (AMLC), fails to do so.

6
Q

What are the covered transactions in AMLA?

A
  1. ) Transactions in cash or other equivalent monetary instrument EXCEEDING PHP 500,000.
  2. ) A transaction EXCEEDING PHP 1,000,000 in cases of jewelry dealers, dealers in precious metals and stones.
  3. ) Single casino cash transactions involving an amount IN EXCESS OF PHP 5,000,000
7
Q

What are suspicious transactions as mentioned in AMLA?

A

Suspicious transactions are transactions with covered institutions regardless of the amounts involved, where any of the following circumstances exist:

  1. ) No underlying LEGAL OR TRADE OBLIGATION/PURPOSE/ECONOMIC JUSTIFICATION.
  2. ) Client is not properly identified
  3. ) The amount involved is NOT COMMENSURATE with the BUSINESS/FINANCIAL CAPACITY of the client.
  4. ) Taking into account all known circumstances, it may be perceived that the CLIENT’S TRANSACTION IS STRUCTURED IN ORDER TO AVOID BEING THE SUBJECT OF REPORTING REQUIREMENTS UNDER THE ACT.
  5. ) Any circumstances relating to the TRANSACTION WHICH IS OBSERVED TO DEVIATE FROM THE PROFILE OF THE CLIENT and/or THE CLIENT’S PAST TRANSACTIONS WITH THE COVERED INSTITUTION.
  6. ) Transaction is in a way related to an unlawful activity or offense under AMLA that is about to be, is being, or has been committed.
  7. ) Any transaction that is similar or analogous to any of the foregoing.
8
Q

What are covered persons under AMLA?

A
  1. ) Banks/non-banks/trust entities/dealers/pawnshops/other entities SUPERVISED AND REGULATED BY BANGKO SENTRAL NG PILIPINAS
  2. ) Insurance and pre-need companies and others supervised by INSURANCE COMMISSION.
  3. ) Security dealers/brokers/investment houses and other similar persons supervised by SECURITIES AND EXCHANGE COMMISSION.

Below are the Designated Non-Financial Businesses and Professions (DNFBPs):

4.) JEWELRY DEALERS IN PRECIOUS STONES AND METALS who, as a business, trade in such for transactions EXCEEDING PHP 1,000,000.

  1. ) Company service providers including CPAs and Lawyers who provide any of the following services to 3rd persons:
    a. ) Acting as formation agent of juridical persons
    b. ) Acting as director/secretary/partner of juridical persons
    c. ) Providing registered office/business address/accommodation/correspondence/administrative address for a company or partnership
    d. ) Acting as a nominee shareholder for another person

6.) Persons who provide any of the following services including CPAs and Lawyers:
a.) Managing of client money/securities/assets
b.) Management of bank/savings/securities accounts
c.) Organization of contributions for the
creation/operation/management of companies.
d.) Creation/operation/management of juridical persons or
arrangement, and buying/selling business entities.

  1. ) Land Registration Authority and all of its Register of Deeds on all real estate transactions EXCEEDING 500,000.
  2. Casinos (Internet and ship-based casinos) for single transactions exceeding 5,000,000
9
Q

Are lawyers and accountants acting as independent legal professionals IN RELATION TO INFORMATION concerning their clients included in “covered persons”?

A

No, because it would compromise client confidence/ the attorney-client relationship, PROVIDED that these lawyers and accountants are AUTHORIZED TO PRACTICE IN THE PHILIPPINES and shall CONTINUE TO BE SUBJECT TO THEIR RESPECTIVE CODES OF PROFESSIONAL CONDUCT/RESPONSIBILITY.

10
Q

What is AMLC?

A

Anti-money Laundering Council refers to the financial intelligence unit of the Republic of the Philippines TASKED TO IMPLEMENT AMLA.

11
Q

What are “Independent legal or accounting professionals”?

A

These are lawyers and accountants working in a private firm or as a sole practitioner who by way of business provides purely legal, notarial or accounting services to their clients.

12
Q

What is a “Politically Exposed Person” (PEP)?

A

It refers to an individual who is or has been entrusted with prominent public position in

(a) the Philippines with substantial authority over policy, operations or the use or allocation of government-owned resources;
(b) a foreign State; or
(c) an international organization.

The term PEP shall include immediate family members, and close relationships and associates that are reputedly known to have:

  1. Joint beneficial ownership of a legal entity or legal arrangement with the main/principal PEP; or
  2. Sole beneficial ownership of a legal entity or legal arrangement that is known to exist for the benefit of the main/principal PEP.
13
Q

What are the unlawful activities listed in AMLA?

A

Unlawful Activity refers to any act or omission, or series or combination thereof, involving or having direct relation, to the following:

  1. ) Kidnapping for ransom
  2. ) Comprehensive Dangerous Drugs Act of 2002
  3. ) Anti-Graft and Corrupt Practices Act
  4. ) Plunder
  5. ) Robbery and Extortion
  6. ) Jueteng and Masiao
  7. ) Piracy on the High Seas
  8. ) Qualified Theft
  9. ) Swindling
  10. ) Smuggling
  11. ) Violations of Electronic Commerce Act of 2000
  12. ) Hijacking under Anti-Hijacking Law, Destructive Arson and Murder
  13. ) “Terrorism” and “Conspiracy to Commit Terrorism”
  14. ) “Financing of Terrorism” under the “Terrorism Financing Prevention and Suppression Act of 2012”;
  15. ) “Bribery” “Corruption of Public Officers”
  16. ) “Frauds and Illegal Exactions and Transactions”
  17. ) “Malversation of Public Funds and Property”
  18. ) “Forgeries” and “Counterfeiting”
  19. ) Violations of the “Anti-Trafficking in Persons Act of 2003
  20. ) Violations of “Revised Forestry Code of the Philippines, as amended”
  21. ) Violations of the “Philippine Fisheries Code of 1998”
  22. ) Violations of the “Philippine Mining Act of 1995”;
  23. ) Violations of the “Wildlife Resources Conservation and Protection Act”
  24. ) Violations of the “National Caves and Cave Resources Management Protection Act”;
  25. ) Violation of the “Anti-Carnapping Act of 2002, as amended”;
  26. ) Violation of “Codifying the Laws on Illegal/Unlawful Possession, Manufacture, Dealing In, Acquisition or Disposition of Firearms, Ammunition or Explosives”;
  27. ) Violation of the “Anti-Fencing Law”;
  28. ) Violation of the “Migrant Workers and Overseas Filipinos Act of 1995, as amended”;
  29. ) Violation of the “Intellectual Property Code of the Philippines, as amended”;
  30. ) Violation of the “Anti-Photo and Video Voyeurism Act of 2009”;
  31. ) Violation of the “Anti-Child Pornography Act of 2009”;
  32. ) Violations of the “Special Protection of Children Against Abuse, Exploitation and Discrimination”;
  33. ) Fraudulent practices and other violations under “Securities Regulation Code of 2000”;
  34. ) Felonies or offenses of a nature similar to the aforementioned unlawful activities that are punishable under the penal laws of other countries.
14
Q

What is the composition of the Anti-Money Laundering Council?

A
  1. ) Governor of the BSP as CHAIRMAN
  2. ) Commissioner of the INSURANCE COMMISSION as MEMBER
  3. ) Chairman of the SEC as MEMBER
15
Q

What are the powers of the AMLC?

A
  1. To require and receive covered or suspicious transaction reports from covered persons;
  2. To issue orders addressed to the appropriate Supervising Authority or the covered person to DETERMINE THE TRUE IDENTITY of the owner of any monetary instrument or property subject of a covered or suspicious transaction report, or request for assistance from a foreign State, or believed by the AMLC, 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 any unlawful activity;
  3. To institute civil forfeiture proceedings and all other remedial proceedings through the OFFICE OF THE SOLICITOR GENERAL
  4. To file complaints with the Department of Justice or the Office of the Ombudsman for the prosecution of money laundering offenses and other violations under the AMLA;
  5. To investigate suspicious transactions and covered transactions deemed suspicious after investigation by the AMLC, money laundering activities and other violations of the AMLA;
  6. To file with the Court of Appeals, ex parte, through the Office of the Solicitor General:a. a petition for the freezing of any monetary
    instrument or property that is in any way related to
    an unlawful activity; orb. an application for authority to inquire into or
    examine any particular deposit or investment,
    including related accounts, with any banking
    institution or non-bank financial institution.
  7. To formulate and implement such measures as may be necessary and justified under the AMLA 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 as provided in the AMLA.
  9. To develop educational programs, including awareness campaign on the pernicious effects, the methods and techniques used, and the viable means of preventing money laundering and the effective ways of prosecuting and punishing offenders;
  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.
  11. To impose administrative sanctions for the violation of laws, rules, regulations, orders, and resolutions issued pursuant thereto.
  12. To require the Land Registration Authority and all its Registries of Deeds to submit to the AMLC, reports on all real estate transactions involving an amount in excess of Five Hundred Thousand Pesos (Php500,000.00) within fifteen (15) days from the date of registration of the transaction, in a form to be prescribed by the AMLC. The AMLC may also require the Land Registration Authority and all its Registries of Deeds to submit copies of relevant documents of all real estate transactions.
16
Q

What is the jurisdiction of Regional Trial Courts over money laundering cases?

A

The regional trial courts shall have jurisdiction to try money laundering cases committed by private individuals, and public officers not covered by the jurisdiction of the Sandiganbayan.

17
Q

What is the jurisdiction of SANDIGANBAYAN over money laundering cases?

A

The Sandiganbayan shall have jurisdiction to try money laundering cases committed by public officers under its jurisdiction, and private persons who are in conspiracy with such public officers.

18
Q

What is meant by “Probable Cause” in AMLA?

A

“Probable Cause” refers to such facts and circumstances which would lead a reasonably discreet, prudent or cautious man to believe that any monetary instrument or property sought to be frozen, inquired into or preserved is in any way related to any unlawful activity and/or money laundering offense.

19
Q

How is money laundering committed?

A

Money laundering is committed by:
A. Any person who, knowing that any monetary instrument or property represents, involves, or relates to the proceeds of any unlawful activity:

  1. transacts said monetary instrument or property;
  2. converts, transfers, disposes of, moves, acquires,
    possesses or uses said monetary instrument or property;
  3. conceals or disguises the true nature, source, location,disposition, movement or ownership of or rights with respect to said monetary instrument or property;
  4. attempts or conspires to commit money laundering
    offenses referred to in (1), (2) or (3) above;
  5. aids, abets, assists in or counsels the commission of the money laundering offenses referred to in (1), (2) or (3) above; and
  6. performs or fails to perform any act as a result of which he facilitates the offense of money laundering referred to in (1), (2) or (3) above.

B. Any covered person who, knowing that a covered or suspicious transaction is required under the AMLA to be reported to the AMLC, fails to do so.

20
Q

How shall money laundering cases and its related unlawful activity be prosecuted?

A

Independent Proceedings. - The prosecution of money laundering and the unlawful activity shall proceed independently. Any person may be charged with and convicted of both money laundering and the unlawful
activity.

21
Q

The AMLC shall act _______ in discharging its functions.

A

Unanimously.

22
Q

Who shall assist the AMLC in discharging its functions?

A

The AMLC Secretariat. - The AMLC shall be assisted by the AMLC Secretariat in the discharge of its functions.

23
Q

What is the composition of the AMLC secretariat?

A

The AMLC Secretariat shall be headed by an
Executive Director who shall be appointed by the AMLC for a term of five(5) years. He must be a:
1.) Member of the Philippine Bar,
2.) At least thirty-five (35) years of age,
3.) Must have served for at least five (5) years either at the BSP, the SEC or the IC,
4.) Of good moral character, unquestionable
integrity and known probity.

He shall be considered a full-time,permanent employee of the BSP with the rank of Assistant Governor.

Composition. - In organizing the Secretariat, the AMLC may choose from those who have served, continuously or cumulatively, for at least five (5) years in the BSP, the SEC or the IC. All members of the Secretariat shall be
considered regular employees of the BSP.

24
Q

What are the preventive measures mentioned in AMLA?

A

1.) Customer Identification - Covered institutions shall establish and record the TRUE IDENTITY of its clients based on official documents.
a. Face-to-Face Contact. - Covered persons shall conduct face-to-face contact at the commencement of the relationship, or as reasonably practicable so as not to interrupt the normal conduct of business, taking into account the nature of the product, type of business and the risks involved; provided that money laundering risks are effectively managed.
The use of Information and Communication Technology in the conduct of face-to-face contact may be allowed, provided that the covered person is in possession of and has verified the identification documents submitted by the prospective client prior to the interview and that the entire procedure is documented.

b. Minimum Customer Information and Identification Documents include: Name of customer; Date and place of birth; Name of beneficial owner, if applicable;
Name of beneficiary (in case of insurance contracts or remittance transactions); Present address; Permanent address; Contact number or information;
Nationality; Specimen signatures or biometrics of the customer; Nature of work and name of employer or nature of self‐employment/ business, if applicable;
Sources of funds or property; and Tax Identification Number (TIN), Social Security System (SSS) number, or Government Service Insurance System (GSIS) number, if applicable.

25
Q

Customers who engage in a transaction with a covered person FOR THE FIRST TIME shall be required to?

A

PRESENT THE ORIGINAL AND SUBMIT A CLEAR COPY OF AT LEAST ONE OFFICIAL IDENTIFICATION DOCUMENT.

26
Q

What additional requirement is needed for foreign nationals/aliens transacting with covered persons?

A

Foreign nationals/aliens must present their PASSPORT or ALIEN CERTIFICATE OF REGISTRATION issued by BUREAU OF IMMIGRATION

27
Q

May a covered person rely on 3rd parties to perform customer identification?

A

Yes. The 3rd person shall be a:

  1. ) Covered person; OR
  2. ) A financial institution or DNFBP operating OUTSIDE THE PHILIPPINES that is covered by equivalent customer identification and face-to-face requirements.

The ULTIMATE RESPONSIBILITY FOR IDENTIFYING CUSTOMER REMAINS WITH THE COVERED PERSON RELYING ON 3RD PARTY.

28
Q

May a covered person OUTSOURCE the conduct of customer identification?

A

Yes. The outsourced party shall BE REGARDED AS THE AGENT OF THE COVERED PERSON. In effect, the processes and documentation are those of the covered person itself.

29
Q

What is the responsibility of covered persons involving beneficial owners?

A

Covered persons shall establish and record the true and full identity and existence of both the ACCOUNT HOLDER OR TRANSACTOR and the BENEFICIAL OWNER OR PERSON ON WHOSE BEHALF THE TRANSACTION IS BEING CONDUCTED.

The covered person shall determine the true nature of the parties’ capacities and duties by OBTAINING A COPY OF THE WRITTEN DOCUMENT EVIDENCING THEIR RELATIONSHIP AND APPLY THE SAME STANDARDS FOR ASSESSING THE RISK PROFILE AND DETERMINING THE STANDARD OF DUE DILIGENCE TO BE APPLIED TO BOTH.

30
Q

What are the rules on record-keeping with respect to AMLA?

A

All records of all transactions of covered institutions shall be MAINTAINED AND SAFELY STORED FOR 5 YEARS FROM THE DATE OF THE TRANSACTIONS.

With respect to CLOSED ACCOUNTS, records on customer identification and files shall be SAFELY STORED FOR 5 YEARS FROM THE DATE THEY WERE CLOSED.

If a case has been FILED IN COURT involving an account, RECORDS MUST BE RETAINED AND SAFELY KEPT BEYOND THE 5 YEAR PERIOD UNTIL IT IS OFFICIALLY CONFIRMED BY THE AMLC SECRETARIAT that the case has been resolved/terminated/decided with finality.

31
Q

When should covered persons report to the AMLC all covered and suspicious transactions?

A

Covered persons should report to the AMLC all covered and suspicious transactions WITHIN 5 WORKING DAYS FROM OCCURRENCE THEREOF, UNLESS THE AMLC PRESCRIBES A DIFFERENT PERIOD NOT EXCEEDING 15 WORKING DAYS.

32
Q

What is meant by “occurrence” with respect to suspicious transactions?

A

“Occurrence” with respect to suspicious transactions refers to the date of determination of the suspicious nature of the transaction, which the DETERMINATION SHOULD BE MADE NOT EXCEEDING 10 CALENDAR DAYS FROM THE DATE OF TRANSACTION.

However, if the transaction is related to a person involved in or connected to an unlawful activity or money laundering offense, the 10-DAY PERIOD FOR DETERMINATION SHALL BE RECKONED FROM THE DATE THE COVERED PERSON KNEW OR SHOULD HAVE KNOWN THE SUSPICIOUS TRANSACTION INDICATOR.

33
Q

Discuss confidentiality of reporting with respect to AMLA.

A

When reporting covered or suspicious transactions, covered persons, and their officers and employees, are PROHIBITED FROM COMMUNICATING, directly or indirectly, in any manner or by any means, to any person or entity, or the media, the fact that a covered or suspicious transaction has been or is about to be reported, the contents of the report, or any other information in relation thereto. Any information about such reporting shall not be published or aired, in any manner or form, by the mass media, or through electronic mail, or other similar devices. In case of violation thereof, the concerned officer, and employee, of the covered person and media shall be held criminally liable.

34
Q

Should a transaction be determined to be both a covered and a suspicious transaction, the same shall be reported as?

A

A suspicious transaction.

35
Q

What is the Safe Harbor Provision of AMLA?

A

No administrative, criminal or civil proceedings shall lie against any person for having made a covered transaction or suspicious transaction report in the regular performance of his duties and in good faith, whether or not such reporting results in any criminal prosecution under the AMLA or any other Philippine law.

36
Q

When can AMLC inquire into bank deposits?

A

1.) Upon order of competent court -

AMLC may inquire into or examine any particular deposit or investment account, including related accounts, with any banking institution or non-bank financial institution, UPON ORDER BY THE COURT OF APPEALS BASED ON AN EX PARTE APPLICATION IN CASES OF VIOLATION OF AMLA when it has been established that probable cause exists that the deposits or investments involved, including related accounts, are in any way related to an unlawful activity or a money laundering offense.

2.) No Court order is required -

The AMLC shall issue a resolution authorizing the AMLC Secretariat to inquire into or examine any particular deposit or investment account, including related accounts, with any banking institution or non-bank financial institution and their subsidiaries and affiliates when it has been established that probable cause exists that the deposits or investments involved, including related accounts, are in any way related to any of the following unlawful activities:

a. ) Kidnapping for ransom
b. ) Comprehensive Dangerous Drugs Act of 2002
c. ) Hijacking and other violations
d. ) Felonies or offenses of a nature similar to those mentioned above
e. ) Terrorism and conspiracy to commit terrorism
f. ) Financing of terrorism under Terrorism Financing Prevention and Suppression Act of 2012

37
Q

Who are excluded from reporting covered transactions to AMLC?

A
  1. Lawyers acting as independent legal professionals in relation to the disclosure of information where it could compromise client confidence and attorney-client relationship
  2. CPAs if acting as independent legal professionals
38
Q

T or F

The elements of money laundering are separate and distinct from the elements of the unlawful activity.

A

True.

39
Q

T or F
Upon verified ex parte petition by the AMLC and after the determination that probable cause exists that any monetary instrument or property is in any way related to an unlawful activity, the Court of Appeals may issue a freeze order, which shall be effective for a period of 30 days.

A

False, 20 days only,

Within the 20 days the Court of Appeals shall conduct a summary hearing with notice to the parties to determine whether or not to modify the freeze order or extend its effectivity.

40
Q

What is the period to resolve application by Court of Appeals in relation to AMLA?

A

24 hours

41
Q

T or F
Upon determination that probable cause exists that any monetary instrument or property is in any way related to an unlawful activity or a money laundering offense, the AMLC shall file with the RTC through the Office of the SolGen a verified petition for civil forfeiture.

A

True.

42
Q

T or F
No prior criminal charge, pendency of or conviction for an unlawful activity or money laundering offense is necessary for the commencement or the resolution of a petition for civil forfeiture

A

True.

43
Q

T or F
Where there is conviction for money laundering, the court shall issue a judgment of forfeiture in favor of the Government of the Philippines with respect to the monetary instrument or property found to be proceeds of an unlawful activity.

A

True.

44
Q

AMLA was recently amended. What act amended AMLA and when?

A

RA 11521 amended AMLA law which was signed into law on January 29, 2021 to prevent PH from becoming part of the gray list (countries with weak financial policies against dirty money by Financial Action Task Force)

45
Q

What are the additions brought by RA 11521?

A
  1. Transactions in excess of 500,000 of all PH offshore gaming operators (POGO) within the purview of AMLA.
  2. Include real estate brokers and developers as covered persons, but only for single cash transactions involving amounts in excess of PHP 7,500,000, effectively narrowing the burden of reportorial requirements for high-risk transactions.
  3. Tax crimes with a threshold of PHP 25,000,000 and violations of the Trade Management Act on the financing of the proliferation of weapons of mass destruction as a predicate offense to money laundering and set a threshold to excess of PHP 25,000,000
  4. Granting AMLC the following additional powers:
    a. Authority to require, receive and analyze covered or suspicious transaction reports from covered persons
    b. Issue subpoenas and conduct search and seizures of suspicious accounts
    c. Preserve, manage, or dispose assets pursuant to a freeze order, preservation order or judgment of forfeiture
    d. To implement targeted financial sanctions in relation to the proliferation of weapons of mass destruction and their financing
  5. Adopt information security and confidentiality proposals, safeguarding information processed through AMLC and deterring the council’s staff from leaking or misusing information
46
Q

What is the maximum/total period of the freeze order that may be issued by the Court of Appeals for bank accounts which is allegedly related to proceeds of any unlawful activity?

A

It shall not exceed 6 months.

47
Q

What quantum of evidence must be presented to AMLC before it may file with the RTC through the office of the Solicitor General a verified petition for civil forfeiture of any monetary instrument or property is in any way related to an unlawful activity or a money laundering offense?

A

Probable Cause only

48
Q

What quantum of evidence is necessary for conviction of crime of money laundering?

A

Proof beyond reasonable doubt.