Reports from the House of Representatives said the FATF was dissatisfied with RA 9160, particularly the provision setting a threshold of P4 million for automatically triggering government surveillance of a financial transaction. Monetary officials stressed yesterday that the FATF had not yet formally rejected the new law, which will undergo final review in February. But they conceded that the FATF was dissatisfied with RA 9160. They also said either the law would have to be amended or given more teeth through implementing rules and regulations.
The minimum amount for triggering surveillance was a contentious issue even when the law was being crafted. Several lawmakers pointed out that the universal threshold is $10,000 or roughly P500,000 – the amount used in the United States. In a Congress of millionaires, however, members made sure their bank transactions would not be touched. The House wanted a threshold of P5 million while the Senate pushed for P3 million. Their compromise was P4 million. Critics pointed out that anyone involved in illegal deals could deposit P4 million a day without arousing suspicion. Until February there will be no sanctions against the Philippines for the inadequate law, monetary officials said yesterday. The likely sanctions could affect Philippine transactions with foreign banks, including the multibillion-dollar remittances of overseas Filipino workers.
While it’s tempting to tell the FATF to just take the law and shove it, the country has little choice but to comply with international standards in the fight against money laundering. The fight has taken on added importance because of the threat of international terrorism. This is serious business, and the law needed to fight money laundering must not leave loopholes that can be circumvented. Lawmakers, with help from monetary officials, have time to fine-tune the anti-money laundering law. This time, they should do more than just try to meet a deadline.