If fund is found legit, FATF must pay fine!

PROTECTING RIGHTS: If we have nothing to hide, they tell us, we should not be alarmed at the demand of Paris-based Financial Action Task Force that any bank deposit of at least P500,000 can be examined without need for a court order.

Point well taken. But still, the government should not accept this invasion of our privacy without iron-clad assurances that our rights are amply protected.

The FATF claims that its worldwide surveillance is part of a campaign to track down dirty money, including proceeds of the drug trade and official corruption, being laundered through the banking system.

The FATF wants to crack bank secrecy rules and impose sanctions on governments and banks that do not go along with its inspection wishes.

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COUNTER-MEASURES: Even as a small depositor whose voice will not even register as a whimper, we propose counter-measures to possible abuse of this police power being demanded by FATF.

Our proposals are still rough in our mind, but we will list them now – since the FATF people are already holding serious discussions with lawmakers being pressured to lower the inspection threshold to P500,000 without court order.

We submit that these minimum provisions must be inserted into the bill amending the Anti-Money Laundering Act along the PATF demands:

1. The depositor must be informed in advance of the planned inspection of his account and given the option of being present during the audit or sending a representative. Examination must be at the local address of the bank.

2. In the event the fund examined is found to be legitimate income or asset, the depositor must be paid a disturbance fee. This will help discourage malicious or capricious inspection.

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OTHER CRITERIA: The FATF or anybody for that matter should not be allowed blanket surveillance powers. Imagine what could happen if any account that is P500,000 or bigger is immediately susceptible to secret inspection by FATF operatives.

There should be reasonable suspicion that the money is illegally acquired before it is marked for examination. At this point we have not seen any proposed mechanism to make sure there is just and reasonable basis for inspection.

The criterion for inspection should not only be the amount. Audit of the fund should also be based on the circumstances of its acquisition and its accumulation in the bank.

This would force FATF auditors to be careful. If they abuse their inspection powers and pick on innocent bank depositors, they should pay for it.

We should start from the basic presumption that money in the bank is legitimate income. Until it is proved to be dirty money, it is presumed to be clean. The burden of proof is on the FATF.

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INFORMAL MEDIA: But while we argue this way, the FATF does not. Worse, the FATF holds us hostage because it controls a substantial section of the world’s banking and financial systems.

Even now, we are already being made to feel the extent of its coercive powers. Bank transactions involving Filipino businessmen and overseas workers have been reported to be experiencing problems traced to our failure to obey FATF so far.

We are sure, however, that overseas Filipino workers (OFW) would be able to find a way to circumvent the FATF rigmarole. Like a rushing river, much of the money flow from our overseas workers will find its way home if the regular banking route proves difficult.

Just like many small entrepreneurs going underground to escape the cumbersome and expensive bureaucratic maze, many Filipinos working abroad will use informal remittance media to send money home.

You can be sure that non-bank services will sprout in the event the banking route proves difficult.

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OFW ASSURED: In the Senate, Majority Leader Loren Legarda allayed fears that remittances of OFWs would be delayed or compromised should FATF make good its threat to impose sanctions.

She explained that the average monthly remittances or bank balances of workers fall well below the $10,000 (P500,000) threshold the FATF wants. "This would not invite scrutiny," she said, adding that the average remittance is $400 a month.

The FATF formally reiterated yesterday to lawmakers its March 15 deadline for Congress to amend the anti-money laundering act (AMLA) in obedience to its dictates.

"Congress wants to reach a middle ground because the Philippines, a prime mover against global terrorism, is also one with the world in wanting to stamp out money laundering," she said.

Legarda said that any AMLA amendment should not be in reaction to threats of sanctions and should conform to the other laws.

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BUM STEER: President and General Manager Winston Garcia of the Government Service Insurance System is learning the sad fact that when somebody wants badly to grab your seat in government, he will stop at nothing.

A newspaper carried a report days ago that Garcia’s kidneys have so deteriorated that a dialysis machine is now standard equipment in his office. The implication is that he is too sick to stay in office.

The section editor who fell for the bum steer learned of the mistake only after its publication, after the harm had been done.

The editor is expected to refuse to identify the source of the malicious report, but it is common knowledge in news and insurance circles that the man who fed him the false item goes by the initial BS, not necessarily meaning bull shit.

This pretender to the top GSIS post is fond of dropping the name of Executive Secretary Bert Romulo who, he likes to tell anybody who cares to listen, has already signed his appointment.

The man used to be an officer in a big insurance firm. He was a consultant of the National Power Corp. when the state power firm and the GSIS were at odds over the reinsurance of Napocor properties.

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