The Philippines, Russia and the tiny Pacific island nation of Nauru, part of blacklist of non-cooperative nations, have all been given until Sept. 30 to enact appropriate anti-money laundering laws.
Sources close to the Paris-based Financial Action Task Force (FATF) said yesterday Russia will escape threatened sanctions but the Philippines may be sanctioned in October. A decision on Nauru, which has already passed an anti-money laundering measure, has been deferred.
Ukraine and Grenada were added Friday to the black list of nations and territories, bringing the total number to 19, one source said.
In her weekly press conference at Malacañang yesterday, the President said the government is now exerting all efforts to pass the law before the deadline imposed by international private watchdog FATF.
"A special session has been suggested but I haven’t decided on it yet. I suppose it really depends on the international banking community," Mrs. Arroyo said.
The FATF, which is backed by several industrialized nations, has given the government until the end of the month to pass a law to combat laundering practices, "or face a much harder time in dealing with international banks."
"But if they see us working hard for the passage of the law and if they continue with the normal way of transacting with businesses, then there is no need for a special session," the President said.
Finance Secretary Jose Camacho, the designated pointman in Malacañang’s drive against money laundering, said Manila has already sent updates to the FATF.
A communication, signed by Bangko Sentral ng Pilipinas Gov. Rafael Buenaventura, informed the task force on the status of anti-money laundering legislation but did not ask for an extension of the deadline.
The FATF is set to present an update to formally identify non-cooperative countries and to detail proposed countermeasures.
Magsaysay said that the technical working group of the two committees would be working with key officials of the Bangko Sentral ng Pilipinas and the Department of Finance in finalizing the committee report, which could be submitted before the 12th Congress resumes regular session on Sept. 24.
He has recommended that the measure prepared by a multi-agency committee headed by the BSP be used as the working draft.
While Magsaysay is for a speedy action on the bill, Senators Joker Arroyo, John Osmeña and Pangilinan are of a different mind.
"We should pass the law not to please the FATF but to please our people," Arroyo said.
He and Osmeña both expressed fears that the local Chinese community might no longer place their deposits in local banks once the anti-money laundering measure is passed.
"The Chinese community is wary of the anti-money laundering bill, and without the Chinese community, the banking industry would be jeopardized," Arroyo said.
Osmeña said that Philippine leaders should not be cowed by the "faceless FATF" into passing a law that might not really help the country. He insisted that the measure should be thoroughly analyzed and discussed instead of being acted upon in haste because of the FATF deadline.
Osmeña aired the fears of Chinese leaders that they would become more vulnerable to kidnapping once their bank accounts become more open to examination even without court orders.
He also claimed that provisions of the proposed bill on reporting of questionable deposits and on forfeiture of assets might be confiscatory.
Osmeña added that making top officials of the BSP, the justice department and the finance departments members of a key committee on money laundering activity would only over-burden them.
Arroyo and Pangilinan, meanwhile, said that the BSP proposed-bill needs "overhaul."
They said that the bill mentions almost all offenses specified in the Revised Penal Code, including anti-fencing and illegal fishing. They said that these do not involve big amounts.
Pangilinan pointed out that in the United States, the anti-money laundering law centered only on illegal drugs, and terrorism, while the local measure included almost all illegal activities conceivable under the sun.