Economists want bank secrecy laws relaxed
A GROUP of prominent economists and sociopolitical thinkers has called for the implementation of a biometric-based national identification system, the easing of stringent bank secrecy laws and the strengthening of the anti-money laundering law to prevent more inflows of dirty money into the Philippine financial system.
The Foundation for Economic Freedom (FEF), an organization advocating good governance, market-friendly economic reforms as well as economic and political liberty, issued a statement on Thursday calling for these reforms in view of the recent laundering of money stolen from the Bangladesh Central Bank using the country’s financial system and casino industry.
The Philippines’ capability to combat money laundering has come under global scrutiny after some $81 million stolen by computer hackers from the account of the central bank of Bangladesh with the Federal Reserve Bank of New York slipped into the country through the Rizal Commercial Banking Corp. branch in Jupiter Street, Makati, and found its way to local casinos and other entities.
This recent development, the FEF said, has “demonstrated the need to strengthen the authority of government to prosecute those who criminally violated the Anti-Money Laundering Act (AMLA).”
“The Philippine financial system is put at risk when banking and anti-money laundering authorities are blocked from uncovering the truth about offenses of money laundering due to the current bank secrecy laws,” the FEF said in a statement dated March 24.
“Money laundering using the Philippine financial system is already adversely affecting our overseas Filipino workers by increasing their remittance costs,” the FEF said.
The FEF supports the relaxation of certain provisions of the bank secrecy law that impede investigation by banking and anti-money laundering authorities of suspicious accounts for the prosecution of money laundering, drug dealing, terrorist activities and other major crimes.
“Criminals will be put on notice that they cannot use the bank secrecy law to hide the movement of ill-gotten wealth and will be deterred in using the Philippine financial system in the first place,” the group said.
No less than Bangko Sentral ng Pilipinas Governor Amando Tetangco Jr., who also chairs the Anti-Money Laundering Council (AMLC), has lamented the fact that the country’s stringent bank secrecy law has hampered efforts to prevent money laundering, such as the cross-border remittance of dirty money from Bangladesh.
The FEF also supported calls for Congress to amend the AMLA to cover casinos, real estate transactions, and art purchases—sectors which have been excluded from the coverage of the law during the last time that the local enabling law was amended.
The economists also supported calls to give the AMLC the power to immediately freeze suspicious accounts under certain conditions.
At present, AMLC needs to ask for an order from the Court of Appeals to be able to freeze suspicious transactions.
