AMLC to penalize failure to digitize customer records

MANILA, Philippines — The Anti-Money Laundering Council (AMLC) will penalize banks, insurance companies and other covered institutions that fail to meet the Sept. 30 deadline for the computerization of customer records.

The financial intelligence unit has given all covered persons enough time as it extended the deadline for the digitization of customer records (Digicur) by another year, until this Sept. 30, as stated under AMLC Regulatory Issuance 6, Series of 2021.

The AMLC has extended the deadline three times since the guidelines were issued in September 2018. The original deadline was set in April 2019, but was extended to April 13, 2021, and then to Sept. 30, 2021, and now  to Sept. 30 this year.

According to the AMLC, covered entities should submit Digicur status of compliance every quarter, the first of which is due by Oct. 15 this year.

“Failure to fully comply with the Digicur by Sept. 30 shall warrant the imposition of enforcement actions such as warning, compliance letter, and notarized compliance commitment in accordance with ARI 5, Series of 2020, otherwise known as the enforcement action guidelines,” the AMLC said.

It said all covered entities should have updated their Money Laundering Terrorism, Financing Prevention Program to incorporate the provisions of the Digicur and should have digitized at least 50 percent of the records of existing customers prior to the effectivity of the Digicur in October 2018.

Likewise, entities should have digitized at least 50 percent of the records of new customers opened after the effectivity of the Digicur and should have established a central database for customer records.

The agency also said that banks, insurance companies and other covered entities should complete the digitization of customer records by end-December next year.

“Notwithstanding the above enforcement actions, non-compliance with the Digicur remains to be a grave violation under the rules of procedure in administrative cases, with penalties ranging from P37,500 to P375,000 per customer,” the AMLC said.

Aside from banks and financial institutions, Republic Act 9160 or the Anti-Money Laundering Act of 2001 as amended, also includes other covered persons such as businesses, casinos, and professions subject to the authority and jurisdiction of the AMLC on anti-money laundering and counterterrorism financing matters.

The AMLC believes the covered person’s compliance officer or other duly authorized officers are expected to retrieve customer records quickly, and, upon request or order, upload these to the AMLC’s portal, without having to request said records from branches on a per need basis.

In turn, direct access to customer records in the covered person’s database would empower compliance officers and their duly authorized officers to proactively analyze by themselves the financial profile of customers, independently of the covered person’s frontliners.