Antimoney laundering rules tightened

The Bangko Sentral ng Pilipinas has further tightened its antimoney laundering rules while still providing flexibility for the unbanked who wanted to open bank accounts.

In a statement, the BSP yesterday said the Monetary Board, its highest policymaking body, had approved amendments to regulations governing antimoney laundering and antiterrorist financing efforts.
“This is part of ongoing efforts to strengthen the financial system’s safeguards against money laundering and terrorist financing balanced against the objective of also promoting financial inclusion of the unbanked.”

According to the BSP, the Monetary Board-approved amendments include “refinements in the conduct of customer due diligence, more pragmatic definition of ‘official document’ and the use of other reliable, independent source documents, data or information for customer identification and verification.”

“The new rules likewise introduced the concept of a ‘restricted account’ to cater to targeted unbanked sector, wherein minimal customer information are required subject to certain conditions, such as constraints in terms of activity. These will provide much greater flexibility in on-boarding unbanked customers, especially in rural areas where official IDs are not prevalent,” the BSP added.

Given strides in technology even in the financial and banking system, the amended rules “recognize and allow the use of information and communication technology in the conduct of customer identification subject to implementation of appropriate measures to manage attendant risks,” the BSP said.

As such, the BSP said the new rules allowed escalated supervisory enforcement action when there were heightened concerns in terms of risks from money laundering as well as terrorism financing, as reflected in the overall antimoney laundering risk rating of a covered person.

As a whole, the revised regulations “emphasize the importance of a sound money laundering and terrorist financing risk assessment, the foundation of a proportionate, risk-based approach, to appropriately focus greater efforts and resources on areas posing higher risks, while reducing these for low-risk transactions,” according to the BSP.

“Requirements for group-wide antimoney laundering compliance function and monitoring systems are incorporated for a holistic management and prevention of money laundering and terrorist financing risks,” it said.