In its Resolution No. 59, dated 9 May 2018, the Anti-Money Laundering Council (AMLC) approved the adoption of the Anti-Money Laundering and Counter-Terrorism Financing (AML/CFT) Guidelines for Designated Non-Financial Businesses and Professions (DNFBPs). Said Guidelines are based on Republic Act (RA) No. 10365, which included as covered persons jewelry dealers in precious stones and metals; company service providers who deliver fund/securities management services for other persons, and persons and entities who, as a business, provide services to organize, create and manage companies and arrangements.
The Guidelines for DNFBPs were patterned largely after the “Casino Implementing Rules and Regulations” (CIRR), which the AMLC approved on 11 October 2017. Republic Act (RA) No. 10927, approved on 14 July 2017, included casinos as covered persons under RA No. 9160, or the Anti-Money Laundering Act of 2001 (AMLA) and authorized the AMLC to adopt implementing rules and regulations. Both casinos the non-financial businesses and professions above are considered DNFBPs by the Financial Action Task Force (FATF), the international policy-making body that sets standards and promotes effective implementation of measures to combat money laundering and terrorism financing.
Under the Guidelines, the AMLC oversees compliance by DNFBPs with the provisions of the AMLA, as amended. Interestingly, the Guidelines that lawyers and accountants who provide the services enumerated under Section 3(a)(7) of the AMLA, as amended, are considered covered persons, and must therefore report covered and suspicious transactions to the AMLC. Nonetheless, following the law, the Guidelines respect the attorney-client privilege and other client confidences, and recognize that some lawyers and accountants perform these services, not as a business but as their bread and butter, or primary source of income.
Taking the cue from the Bangko Sentral ng Pilipinas (BSP) Circular No. 942, dated 24 January 2017 in regard to the registration of money service businesses (MSBs), the Guidelines require DNFBPs to register with the AMLC, and, attendant to registration, submit deeds of undertaking to comply with the provisions of the AMLA, and to attend regular AML/CTF trainings.
Executive Director Mel Georgie B. Racela of the AMLC Secretariat noted the novelty of the Guidelines: “Inclusion of DNFBPs as covered persons is something new to us. Businesses and professions that, until now, have played a marginal role in our fight against money laundering and terrorism financing, will find themselves heavily involved in it. The AMLC itself had very little contact with these DNFBPs prior to 2018. It will probably take time for the newly-adopted measures to take root. But we have one foot through the door, and this is a remarkable achievement. It has been observed in our series of engagements with them at the start of 2018 that the DNFBPs have been largely cooperative with the AMLC, recognizing that they could be used as instruments in the commission of money laundering or terrorism financing. Certainly, professional secrecy cannot be used as a cloak to commit crime. I see that in the foreseeable future, the Philippines will come to embrace international AML/CTF standards more and more.”
Racela added, “The Asia Pacific Group on Money Laundering or the APG, noted in our last mutual evaluation in 2008, that the Philippines’ lack of a regulatory framework for DNFBPs was a technical compliance issue. With the adoption of the Guidelines, the Philippines would be more technically compliant with international standards.”
The Guidelines will take effect fifteen (15) days following publication in a newspaper of general circulation.