AMLC urges vigilance as suspicious money transactions surge

Benjamin Diokno INQUIRER PHOTO/JOAN BONDOC

The Anti-Money Laundering Council (AMLC) urged financial industry stakeholders to remain cautious and vigilant amid rising evidence that criminal elements may be abusing digital platforms that are now seeing greater adoption due to the pandemic.

AMLC Chair and Bangko Sentral ng Pilipinas Gov. Benjamin Diokno said proper know-your-customer and customer due-diligence procedures must always be conducted while clients’ risk ratings must be periodically assessed.

“Likewise, online fund transfer service providers are advised to be vigilant especially during the pandemic,” he said in a press briefing.

In particular, the AMLC noted a surge in suspicious transaction reports related to online activities in its monitoring of the trend of financial crimes during the COVID-19 public health crisis.

The report examines red-flagged transactions submitted by financial institutions to the regulator from January to August of this year, covering the months of the various quarantine schemes imposed across the country.

Suspicious transaction report submissions for the period increased by 57 percent compared with the same months in 2019.

Of the total number of suspicious transactions, only 29 percent, however, occurred between the start of the lockdown in March to the end of August 2020. Red flag submissions of electronic money issuers soared by 688 percent while those of pawnshops and money service businesses climbed by 51 percent.

The regulator said the top reasons for transactions being flagged included unauthorized account access through skimming and phishing and other violations of the Electronic Commerce Act at 49 percent with an estimated value of P2.7 billion; online sexual exploitation of children and related crimes at 13 percent with an estimated value of P84.5 million, and suspected money mules or pass-through accounts at 9 percent with an estimated value of P406.9 million.

Due to the increase in the use of the online and e-money space for money laundering, suspicious transaction reports related to electronic banking transactions grew by 1,680 percent for inward fund transfers and 5,158 percent for outward fund transfers. These reports, involving cash-in and -out via electronic cash cards, rose by 580 percent and 197 percent, respectively.

AMLC’s report also noted an increase in suspected money mule or pass-through accounts and fraudsters pretending to be affiliated with a government unit and a government agency in soliciting COVID-19 donations.

Other illegal activities detected were online shopping swindling scheme involving Bitcoin as well as large incoming or outgoing transactions for COVID-19. INQ