The Department of Justice (DOJ) has ordered the filing of charges for four counts of money laundering against the owners of local remittance firm Philrem Service Corp. in connection with the $81-million Bangladesh Bank cyberheist in 2016.
In a 23-page resolution dated Dec. 12, 2019, Justice Undersecretary Adrian Ferdinand Sugay reversed an earlier department ruling that dismissed the charges against the remittance firm’s owners.
He said Philrem—a covered institution under the Anti-Money Laundering Act—failed to report to the Anti-Money Laundering Council (AMLC) the series of suspicious transactions that paved the way to conceal money stolen from the central bank of Bangladesh almost four years ago.
Upholding AMLC’s position, the justice department said there was more than sufficient evidence to charge Philrem owners Salud and Michael Bautista and the firm’s compliance officer, Anthony Pelejo, “for knowingly transacting with money that represents, involves or relates to the proceeds of an illegal activity, which facilitated the offense of money laundering.”
“Since Philrem Service Corp. is a covered institution under Republic Act No. 9160, as amended, its officers are and should be charged with full knowledge of the corporation’s legal obligations,” the resolution said.
“That [their] suspicious transaction report said so little despite what the law very clearly required betrays an attempt on the part of the corporation’s responsible officers to conceal, what is, in truth, a very irregular, if not downright illegal, transaction,” it added.
Meanwhile, the same resolution upheld an earlier recommendation by government lawyers to dismiss the charges against casino junket operators Kam Sin Wong and Weikang Xu for insufficient evidence.
It stressed that there was not enough proof or corroborating evidence to establish their participation or knowledge in the laundering operation and the nature of the subject funds.
It will be recalled that in February 2016, still unidentified parties used fraudulent orders executed on the Swift electronic payments system to steal $81 million from the Bangladeshi central bank account at the Federal Reserve Bank of New York. The money was sent to fictitious accounts at Rizal Commercial Banking Corp.’s (RCBC) Jupiter Street branch in Makati City, then found its way into the casino industry in the Philippines via Philrem.
Last year, the Makati Regional Trial Court Branch 149 found former RCBC branch manager Maia Deguito guilty of eight counts of money laundering in connection with the heist and sentenced her to a jail term ranging from 32 to 56 years. The case is currently on appeal.