Drilon: No choice but to accept changes in anti-laundering law

Senate President Franklin Drilon said yesterday that the Philippines appears to have no choice but to accept the amendments to the Anti-Money Laundering Act (AMLA) proposed by the Paris-based Financial Action Task Force (FATF).

Drilon gave the statement after hearing the views of Bangko Sentral ng Pilipinas Gov. Rafael Buenaventura, Chairman Lilia Bautista of the Securities and Exchange Commission, officials of the Anti-Money Laundering Council (AMLC), and officers of the Bankers Association of the Philippines led by former prime minister Cesar Virata.

Drilon said they were assured that the FATF was not discriminating against the Philippines in seeking to lower the bank transaction threshold from the present P4 million to P500,000.

The threshold amount is the amount of transaction which would trigger automatic reporting to the AMLC.

Senate Majority Leader Vicente Sotto III had charged that the FATF was discriminating against the Philippines because FATF accepted the 2 million baht threshold for Thailand and no threshold at all for Switzerland.

Sen. Ramon Magsaysay Jr., chairman of the Senate committee on banks and principal author of the AMLA amendatory bill, said that FATF became strict on the threshold only after Sept. 11, 2001.

"Thailand enacted its AMLA two years before Sept. 11 while in our case, the bill did not move at all," Magsaysay said.

Drilon, citing the explanation of Buenaventura, Bautista and Virata, said that FATF accepted the absence of any threshold in the case of Switzerland because monitoring authorities there have unlimited access to bank accounts.

"That is the trade-off for the absence of a threshold and we are not prepared for that," he said.

Magsaysay said the bottom line is that sanctions would be imposed by FATF if the Philippines would not lower the threshold amount.

Senate President Pro Tempore Juan Flavier said that he would go along with the lower amount.

"I do not want to gamble with the fate of our overseas workers," he said.

Banking authorities have warned that the OFWs would be the main victims of any FATF sanctions as they would find it very difficult to remit foreign currencies to the Philippines.

Sotto, however, remains unconvinced that a lower amount would redound to the country’s benefit. – Efren Danao