| SECTION 1. Short Title. – This Act shall be known as the “Anti-Money
Laundering Act of 2001.” SEC. 2. Declaration of Policy. –
It is hereby declared the policy of the State to protect and preserve
the integrity and confidentiality of bank accounts and to ensure
that the Philippines shall not be used as a money laundering site
for the proceeds of any unlawful activity. Consistent with its foreign
policy, the State shall extend cooperation in transnational investigations
and prosecutions of persons involved in money laundering activities
wherever committed.
SEC. 3. Definitions. – For purposes of this Act, the following
terms are hereby defined as follows:
(a) “Covered institution” refers to:
(1) banks, non-banks, quasi-banks, trust entities, and all other
institutions and their subsidiaries and affiliates supervised or
regulated by the Bangko Sentral ng Pilipinas (BSP);
(2) insurance companies and all other institutions supervised or
regulated by the Insurance Commission; and
(3) (i) securities dealers, brokers, salesmen, investment houses
and other similar entities managing securities or rendering services
as investment agent, advisor, or consultant, (ii) mutual funds,
close-end investment companies, common trust funds, pre-need companies
and other similar entities, (iii) foreign exchange corporations,
money changers, money payment, remittance, and transfer companies
and other similar entities,
and (iv) other entities administering or otherwise dealing in currency,
commodities or financial derivatives based thereon, valuable objects,
cash substitutes and other similar monetary instruments or property
supervised or regulated by Securities and Exchange Commission.
(b) “Covered transaction” is a single, series, or combination
of transactions involving a total amount in excess of Four million
Philippine pesos (Php4,000,000.00) or an equivalent amount in foreign
currency based on the prevailing exchange rate within five (5) consecutive
banking days except those between a covered institution and a person
who, at the time of the transaction was a properly identified client
and the amount is commensurate with the business or financial capacity
of the client; or those with an underlying legal or trade obligation,
purpose, origin or economic justification.
It likewise refers to a single, series or combination or pattern
of unusually large and complex transactions in excess of Four million
Philippine pesos (Php4,000,000.00) especially cash deposits and
investments having no credible purpose or origin, underlying trade
obligation or contract.
(c) “Monetary instrument” refers to:
(1) coins or currency of legal tender of the Philippines, or
of any other country;
(2) drafts, checks and notes;
(3) securities or negotiable instruments, bonds, commercial papers,
deposit certificates, trust certificates, custodial receipts or
deposit substitute instruments, trading orders, transaction tickets
and
confirmations of sale or investments and money market instruments;
and
(4) other similar instruments where title thereto passes to another
by endorsement, assignment or delivery.
(d) “Offender” refers to any person who commits a money
laundering offense.
(e) “Person” refers to any natural or juridical person.
(f) “Proceeds” refers to an amount derived or realized
from an unlawful activity.
(g) “Supervising Authority” refers to the appropriate
supervisory or regulatory agency, department or office supervising
or regulating the covered institutions enumerated in Section 3(a).
(h) “Transaction” refers to any act establishing any
right or obligation or giving rise to any contractual or legal relationship
between the parties thereto. It also includes any movement of funds
by any means with a covered institution.
(i) “Unlawful activity” refers to any act or omission
or series or combination thereof involving or having relation to
the following:
(1) Kidnapping for ransom under Article 267 of Act No. 3815,
otherwise known as the Revised Penal Code, as amended;
(2) Sections 3, 4, 5, 7, 8 and 9 of Article Two of Republic Act
No. 6425, as amended, otherwise known as the Dangerous Drugs Act
of 1972;
(3) Section 3 paragraphs B, C, E, G, H and I of Republic Act
No.
3019, as amended; otherwise known as the Anti-Graft and Corrupt
Practices
Act;
(4) Plunder under Republic Act No. 7080, as amended;
(5) Robbery and extortion under Articles 294, 295, 296, 299,
300, 301 and 302 of the Revised Penal Code, as amended;
(6) Jueteng and Masiao punished as illegal gambling under Presidential
Decree No. 1602;
(7) Piracy on the high seas under the Revised Penal Code, as
amended and Presidential Decree No. 532;
(8) Qualified theft under Article 310 of the Revised Penal Code,
as amended;
(9) Swindling under Article 315 of the Revised Penal Code, as
amended;
(10) Smuggling under Republic Act Nos. 455 and 1937;
(11) Violations under Republic Act No. 8792, otherwise known
as the Electronic Commerce Act of 2000;
(12) Hijacking and other violations under Republic Act No. 6235;
destructive arson and murder, as defined under the Revised Penal
Code, as amended, including those perpetrated by terrorists against
non-combatant persons and similar targets;
(13) Fraudulent practices and other violations under Republic
Act No. 8799, otherwise known as the Securities Regulation Code
of 2000;
(14) Felonies or offenses of a similar nature that are punishable
under the penal laws of other countries.
SEC. 4. Money Laundering Offense. – Money laundering is a
crime whereby the proceeds of an unlawful activity are transacted,
thereby making them appear to have originated from legitimate sources.
It is committed by the following:
(a) Any person knowing that any monetary instrument or property
represents, involves, or relates to, the proceeds of any unlawful
activity, transacts or attempts to transact said monetary instrument
or
property.
(b) Any person knowing that any monetary instrument or property
involves the proceeds of any unlawful activity, performs or fails
to perform any act as a result of which he facilitates the offense
of money laundering referred to in paragraph (a) above.
(c) Any person knowing that any monetary instrument or property
is required under this Act to be disclosed and filed with the Anti-Money
Laundering Council (AMLC), fails to do so.
SEC. 5. Jurisdiction of Money Laundering Cases. – The regional
trial courts shall have jurisdiction to try all cases on money laundering.
Those committed by public officers and private persons who are in
conspiracy with such public officers shall be under the jurisdiction
of the Sandiganbayan.
SEC. 6. Prosecution of Money Laundering. –
(a) Any person may be charged with and convicted of both the offense
of money laundering and the unlawful activity as herein defined.
(b) Any proceeding relating to the unlawful activity shall be given
precedence over the prosecution of any offense or violation under
this Act without prejudice to the freezing and other remedies provided.
SEC. 7. Creation of Anti-Money Laundering Council (AMLC).
– The Anti-Money Laundering Council is hereby created and
shall be composed of the Governor of the Bangko Sentral ng Pilipinas
as chairman, the Commissioner of the Insurance Commission and the
Chairman of the Securities and Exchange Commission as members. The
AMLC shall act unanimously in the discharge of its functions as
defined hereunder:
(1) to require and receive covered transaction reports from covered
institutions;
(2) to issue orders addressed to the appropriate Supervising Authority
or the covered institution to determine the true identity of the
owner of any monetary instrument or property subject of a covered
transaction report or request for assistance from a foreign State,
or believed by the Council, on the basis of substantial evidence,
to be, in whole or in part, wherever located, representing, involving,
or related to, directly or indirectly, in any manner or by any means,
the proceeds of an unlawful
activity;
(3) to institute civil forfeiture proceedings and all other remedial
proceedings through the Office of the Solicitor General;
(4) to cause the filing of complaints with the Department of Justice
or the Ombudsman for the prosecution of money laundering offenses;
(5) to initiate investigations of covered transactions, money laundering
activities and other violations of this Act;
(6) to freeze any monetary instrument or property alleged to be
proceeds of any unlawful activity;
(7) to implement such measures as may be necessary and justified
under this Act to counteract money laundering;
(8) to receive and take action in respect of, any request from
foreign states for assistance in their own anti-money laundering
operations provided in this Act;
(9) to develop educational programs on the pernicious effects
of money laundering, the methods and techniques used in money
laundering, the viable means of preventing money laundering and
the effective ways of prosecuting and punishing offenders; and
(10) to enlist the assistance of any branch, department, bureau,
office, agency or instrumentality of the government, including government-owned
and -controlled corporations, in undertaking any and all anti-money
laundering operations, which may include the use of its personnel,
facilities and resources for the more resolute prevention, detection
and investigation of money laundering offenses and prosecution of
offenders.
SEC. 8. Creation of a Secretariat. – The AMLC is hereby authorized
to establish a secretariat to be headed by an Executive Director
who shall be appointed by the Council for a term of five (5) years.
He must be a member of the Philippine Bar, at least thirty-five
(35) years of age and of good moral character, unquestionable integrity
and known probity. All members of the Secretariat must have served
for at least five (5) years either in the Insurance Commission,
the Securities and Exchange
Commission or the Bangko Sentral ng Pilipinas (BSP) and shall hold
full-time permanent positions within the BSP.
SEC. 9. Prevention of Money Laundering; Customer Identification
Requirements and Record Keeping. –
(a) Customer Identification. - Covered institutions shall establish
and record the true identity of its clients based on official documents.
They shall maintain a system of verifying the true identity of their
clients and, in case of corporate clients, require a system of verifying
their legal existence and organizational structure, as well as the
authority and identification of all persons purporting
to act on their behalf.
The provisions of existing laws to the contrary notwithstanding,
anonymous accounts, accounts under fictitious names, and all other
similar accounts shall be absolutely prohibited. Peso and foreign
currency non-checking numbered accounts shall be allowed. The BSP
may conduct annual testing solely limited to the determination of
the existence and true identity of the owners of such accounts.
(b) Record Keeping. - All records of all transactions of covered
institutions shall be maintained and safely stored for five (5)
years from the dates of transactions. With respect to closed accounts,
the records on customer identification, account files and business
correspondence, shall be preserved and safely stored for at least
five (5) years from the dates when they were closed.
(c) Reporting of Covered Transactions. - Covered institutions shall
report to the AMLC all covered transactions within five (5) working
days from occurrence thereof, unless the Supervising Authority concerned
prescribes a longer period not exceeding ten (10) working days.
When reporting covered transactions to the AMLC, covered institutions
and their officers, employees, representatives, agents, advisors,
consultants or associates shall not be deemed to have violated
Republic Act No. 1405, as amended; Republic Act No. 6426, as amended;
Republic Act No. 8791 and other similar laws, but are prohibited
from communicating, directly or indirectly, in any manner or by
any means, to any person the fact that a covered transaction report
was made, the contents thereof, or any other information in relation
thereto. In case of violation
thereof, the concerned officer, employee, representative, agent,
advisor, consultant or associate of the covered institution, shall
be criminally liable.
However, no administrative, criminal or civil proceedings, shall
lie against any person for having made a covered transaction report
in the regular performance of his duties and in good faith, whether
or not such reporting results in any criminal prosecution under
this Act or any other Philippine law.
When reporting covered transactions to the AMLC, covered institutions
and their officers, employees, representatives, agents, advisors,
consultants or associates are prohibited from communicating,
directly or indirectly, in any manner or by any means, to any person,
entity, the media, the fact that a covered transaction report was
made, the contents thereof, or any other information in relation
thereto. Neither may such reporting be published or aired in any
manner or form by the mass media,
electronic mail, or other similar devices. In case of violation
thereof, the concerned officer, employee, representative, agent,
advisor, consultant or associate of the covered institution, or
media shall be held criminally liable.
SEC. 10. Authority to Freeze. – Upon determination that probable
cause exists that any deposit or similar account is in any way related
to an unlawful activity, the AMLC may issue a freeze order, which
shall be effective immediately, on the account for a period not
exceeding fifteen (15) days. Notice to the depositor that his account
has been frozen shall be issued simultaneously with the issuance
of the freeze order. The depositor shall have seventy-two (72) hours
upon receipt of the notice to explain why the freeze order should
be lifted. The AMLC has seventy-two (72) hours to dispose of the
depositor’s explanation. If it fails to act within seventy-two
(72) hours from receipt of the depositor’s explanation, the
freeze order shall automatically be dissolved. The fifteen (15)-day
freeze order of the AMLC may be extended upon order of the court,
provided that the fifteen (15)-day period shall be tolled pending
the court’s decision to extend the period.
No court shall issue a temporary restraining order or writ of injunction
against any freeze order issued by the AMLC except the Court of
Appeals or the Supreme Court.
SEC. 11. Authority to Inquire into Bank Deposits. –
Notwithstanding the provisions of Republic Act No. 1405, as amended;
Republic Act No. 6426, as amended; Republic Act No. 8791, and other
laws, the AMLC may inquire into or examine any particular deposit
or investment with any banking institution or non-bank financial
institution upon order of any competent court in cases of violation
of this Act when it has been established that there is probable
cause that the deposits or investments involved are in any way related
to a money laundering offense:
Provided, That this provision shall not apply to deposits and investments
made prior to the effectivity of this Act.
SEC. 12 Forfeiture Provisions. –
(a) Civil Forfeiture. - When there is a covered transaction report
made, and the court has, in a petition filed for the purpose ordered
seizure of any monetary instrument or property, in whole or in part,
directly or indirectly, related to said report, the Revised Rules
of Court on civil forfeiture shall apply.
(b) Claim on Forfeited Assets. - Where the court has issued an
order of forfeiture of the monetary instrument or property in a
criminal prosecution for any money laundering offense defined under
Section 4 of this Act, the offender or any other person claiming
an interest therein may apply, by verified petition, for a declaration
that the same legitimately belongs to him and for segregation or
exclusion of the monetary instrument or property corresponding thereto.
The verified petition shall be filed with the court which rendered
the judgment of conviction and order of forfeiture, within fifteen
(15) days from the date of the order of forfeiture, in default of
which the said order shall become final and executory. This provision
shall apply in both civil and criminal forfeiture.
(c) Payment in Lieu of Forfeiture. - Where the court has issued
an order of forfeiture of the monetary instrument or property subject
of a money laundering offense defined under Section 4, and said
order cannot be enforced because any particular monetary instrument
or property cannot, with due diligence, be located, or it has been
substantially altered, destroyed, diminished in value or otherwise
rendered worthless by any act or omission, directly or indirectly,
attributable to the offender, or it has
been concealed, removed, converted or otherwise transferred to prevent
the same from being found or to avoid forfeiture thereof, or it
is located outside the Philippines or has been placed or brought
outside the jurisdiction of the court, or it has been commingled
with other monetary instruments or property belonging to either
the offender himself or a third person or entity, thereby rendering
the same difficult to identify or be segregated for purposes of
forfeiture, the court may, instead of enforcing the order of forfeiture
of the monetary instrument or property or part thereof or interest
therein, accordingly order the convicted offender to pay an amount
equal to the value of said monetary instrument or property. This
provision shall apply in both civil and criminal forfeiture.
SEC. 13. Mutual Assistance among States. –
(a) Request for Assistance from a Foreign State. - Where a foreign
State makes a request for assistance in the investigation or prosecution
of a money laundering offense, the AMLC may execute the request
or refuse to execute the same and inform the foreign State of any
valid reason for not executing the request or for delaying the execution
thereof. The principles of mutuality and reciprocity shall, for
this purpose, be at all times recognized.
(b) Powers of the AMLC to Act on a Request for Assistance from
a Foreign State. - The AMLC may execute a request for assistance
from a foreign State by: (1) tracking down, freezing, restraining
and seizing assets alleged to be proceeds of any unlawful activity
under the procedures laid down in this Act; (2) giving information
needed by the foreign State within the procedures laid down in this
Act; and(3) applying for an order of forfeiture of any monetary
instrument or property in the court: Provided, That the court shall
not issue such an order unless the application is accompanied by
an authenticated copy of the order of a court in the requesting
State ordering the forfeiture of said monetary instrument or property
of a person who has been convicted of a money laundering offense
in the requesting State, and a certification or an affidavit of
a competent officer of the requesting State stating that the conviction
and the order of forfeiture are final and that no further appeal
lies in respect of either.
(c) Obtaining Assistance from Foreign States. - The AMLC may make
a request to any foreign State for assistance in (1) tracking down,
freezing, restraining and seizing assets alleged to be proceeds
of any
unlawful activity; (2) obtaining information that it needs relating
to anycovered transaction, money laundering offense or any other
matter directly or indirectly related thereto; (3) to the extent
allowed by the law of the foreign State, applying with the proper
court therein for an order to enter any premises belonging to or
in the possession or control of, any or all of the persons named
in said request, and/or search any or all such persons named therein
and/or remove any document, material or object named in said request:
Provided, That the documents accompanying the request in support
of the application have been duly authenticated in accordance with
the applicable law or regulation of the foreign State; and (4) applying
for an order of forfeiture of any monetary instrument or property
in the proper court in the foreign State: Provided, That the request
is accompanied by an authenticated copy of the order of the regional
trial court ordering the forfeiture of said monetary instrument
or property of a convicted offender and an affidavit of the clerk
of court stating that the conviction and the order of forfeiture
are final and that no further appeal lies in respect of either.
(d) Limitations on Requests for Mutual Assistance. - The AMLC may
refuse to comply with any request for assistance where the action
sought by the request contravenes any provision of the Constitution
or
the execution of a request is likely to prejudice the national interest
of the Philippines unless there is a treaty between the Philippines
and the requesting State relating to the provision of assistance
in relation to money laundering offenses.
(e) Requ States. - A request for mutual assistance from a foreignirements for Requests for Mutual Assistance from Foreign
State must
(1) confirm that an investigation or prosecution is being conducted
in respect of a money launderer named therein or that he has been
convicted of any money laundering offense; (2) state the grounds
on which any person is being investigated or prosecuted for money
laundering or the details of his conviction; (3) give sufficient
particulars as to the identity of said person; (4) give particulars
sufficient to identify any covered institution believed to have
any information, document, material or object which may be of assistance
to the investigation or prosecution; (5) ask from the covered institution
concerned any information, document, material or object which may
be of assistance to the investigation or prosecution; (6) specify
the manner in which and to whom said information, document, material
or object obtained pursuant to said request, is to be produced;
(7) give all the particulars necessary for the issuance by the court
in the requested State of the writs, orders or processes needed
by the requesting State; and (8) contain such other information
as may assist in the execution of the request.
(f) Authentication of Documents. - For purposes of this Section,
a document is authenticated if the same is signed or certified by
a judge, magistrate or equivalent officer in or of, the requesting
State, and authenticated by the oath or affirmation of a witness
or sealed with an official or public seal of a minister, secretary
of State, or officer in or of, the government of the requesting
State, or of the person administering the government or a department
of the requesting territory, protectorate or colony. The certificate
of authentication may also be made by a secretary of the embassy
or legation, consul general, consul, vice consul, consular agent
or any officer in the foreign service of the Philippines stationed
in the foreign State in which the record is kept, and authenticated
by the seal
of his office.
(g) Extradition. - The Philippines shall negotiate for the inclusion
of money laundering offenses as herein defined among extraditable
offenses in all future treaties.
SEC. 14. Penal Provisions. –
(a) Penalties for the Crime of Money Laundering. The penalty of
imprisonment ranging from seven (7) to fourteen (14) years and a
fine of not less than Three million Philippine pesos (Php 3,000,000.00)
but not more than twice the value of the monetary instrument or
property involved in the offense, shall be imposed upon a person
convicted under Section 4(a) of this Act.
The penalty of imprisonment from four (4) to seven (7) years and
a fine of not less than One million five hundred thousand Philippine
pesos (Php1,500,000.00) but not more than Three million Philippine
pesos (Php3,000,000.00), shall be imposed upon a person convicted
under Section 4(b) of this Act.
The penalty of imprisonment from six (6) months to four (4) years
or a fine of not less than One hundred thousand Philippine pesos
(Php100,000.00) but not more than Five hundred thousand Philippine
pesos (Php500,000.00), or both, shall be imposed on a person convicted
under Section 4(c) of this Act.
(b) Penalties for Failure to Keep Records. The penalty of imprisonment
from six (6) months to one (1) year or a fine of not less than One
hundred thousand Philippine pesos (Php100,000.00) but not more
than Five hundred thousand Philippine pesos (Php500,000.00), or
both, shall be imposed on a person convicted under Section 9(b)
of this Act.
(c) Malicious Reporting. Any person who, with malice, or in bad
faith, reports or files a completely unwarranted or false information
relative to money laundering transaction against any person shall
be subject to a penalty of six (6) months to four (4) years imprisonment
and a fine of not less than One hundred thousand Philippine pesos
(Php100, 000.00) but not more than Five hundred thousand Philippine
pesos (Php500, 000.00), at the discretion of the court: Provided,
That the offender is not entitled to avail the benefits of the Probation
Law. If the offender is a corporation, association, partnership
or any juridical person, the penalty shall be imposed upon the responsible
officers, as the case may be, who participated in the commission
of the crime or who shall have knowingly permitted or failed to
prevent its commission. If the offender is a juridical person, the
court may suspend or revoke its license. If the offender is an alien,
he shall, in addition to the penalties herein prescribed, be deported
without further proceedings after serving the penalties herein prescribed.
If the offender is a public official or employee, he shall, in addition
to the penalties prescribed herein, suffer perpetual or temporary
absolute disqualification from office, as the case may be. Any public
official or employee who is called upon to testify and refuses to
do the same or purposely fails to testify shall suffer the same
penalties prescribed herein.
(d) Breach of Confidentiality. The punishment of imprisonment ranging
from three (3) to eight (8) years and a fine of not less than Five
hundred thousand Philippine pesos (Php500,000.00) but not more than
One million Philippine pesos (Php1,000,000.00), shall be imposed
on a person convicted for a violation under Section 9(c).
SEC. 15. System of Incentives and Rewards. – A system of
special incentives and rewards is hereby established to be given
to the appropriate government agency and its personnel that led
and initiated an investigation, prosecution and conviction of persons
involved in the offense penalized in Section 4 of this Act.
SEC. 16. Prohibitions Against Political Harassment. – This
Act shall not be used for political persecution or harassment or
as an instrument to hamper competition in trade and commerce. No
case for money laundering may be filed against and no assets shall
be frozen, attached or forfeited to the prejudice of a candidate
for an electoral office during an election period.
SEC. 17. Restitution. – Restitution for any aggrieved party
shall be governed by the provisions of the New Civil Code.
SEC. 18. Implementing Rules and Regulations. – Within thirty
(30) days from the effectivity of this Act, the Bangko Sentral ng
Pilipinas, the Insurance Commission and the Securities and Exchange
Commission shall promulgate the rules and regulations to implement
effectively the provisions of this Act. Said rules and regulations
shall be submitted to the Congressional Oversight Committee for
approval.
Covered institutions shall formulate their respective money laundering
prevention programs in accordance with this Act including, but not
limited to, information dissemination on money laundering activities
and its prevention, detection and reporting, and the training of
responsible officers and personnel of covered institutions.
SEC. 19. Congressional Oversight Committee. – There is hereby
created a Congressional Oversight Committee composed of seven (7)
members from the Senate and seven (7) members from the House of
Representatives. The members from the Senate shall be appointed
by the Senate President based on the proportional representation
of the parties or coalitions therein with at least two (2) Senators
representing the minority. The members from the House of Representatives
shall be appointed by the Speaker also based on proportional representation
of the parties or coalitions therein with at least two (2) members
representing the minority. The Oversight Committee shall have the
power to promulgate its own rules, to oversee the implementation
of this Act, and to review or revise the implementing rules issued
by the Anti-Money Laundering Council within thirty (30) days from
the promulgation of the said rules.
SEC. 20. Appropriations Clause. – The AMLC shall be provided
with an initial appropriation of Twenty-five million Philippine
pesos (Php25,000,000.00) to be drawn from the national government.
Appropriations for the succeeding years shall be included in the
General Appropriations Act.
SEC. 21. Separability Clause. – If any provision or section
of this Act or the application thereof to any person or circumstance
is held to be invalid, the other provisions or sections of this
Act, and the application of such provision or section to other persons
or circumstances, shall not be affected thereby.
SEC. 22. Repealing Clause. – All laws, decrees, executive
orders, rules and regulations or parts thereof, including the relevant
provisions of Republic Act No. 1405, as amended; Republic Act No.
6426, as amended; Republic Act No. 8791, as amended and other similar
laws, as are inconsistent with this Act, are hereby repealed, amended
or modified accordingly.
SEC. 23. Effectivity. – This Act shall take effect fifteen
(15) days after its complete publication in the Official Gazette
or in at least two (2) national newspapers of general circulation.
The provisions of this Act shall not apply to deposits and investments
made prior to its effectivity. |