The Anti-Money Laundering Council says the Philippines has become a destination of “dirty money” generated from criminal activities like kidnapping for ransom, terrorism, and conspiracy to commit terrorism.
In a report posted on its website titled “A Risk Assessment on the Philippines’ Exposure to External Threats based on Submitted Suspicious Transaction Report,” the AMLC says the dirty funds from criminal activities have been circulating in the financial system.
The council says the other illegal activities that are sources of dirty funds are the proceeds from the violations of environmental laws and the illegal trafficking in people.
Parañaque City Rep. Gus Tambunting regretted the council’s announcement but said the good thing was that the government had tried its best to address the problem.
“I support the effort of our government to crack down on these illegal activities. The Philippines cannot be a hotbed for criminals,” said Tambunting, chairman of the House committee on games and amusements.
The AMLC also said the Philippines “has become a source country of illicit funds generated from smuggling.”
“For the illicit funds generated from other predicate offenses included in the study, it was noted that the majority of the said proceeds are only circulating within the Philippine Financial System,” the council said.
The council categorized predicate crimes as trafficking in illegal drugs, plunder and corruption, investment scams and estafa, smuggling, violation of intellectual property rights, the illegal manufacture and possession of firearms, ammunition, and explosives, violation of environment laws, web-related crimes, illegal trafficking of persons, kidnapping for ransom, financing for terrorism and terrorism and conspiracy to commit terrorism.
The study covered 161,650 suspicious transaction reports worth P17.895 trillion from January 2013 to December 2017 as submitted by the Bangko Sentral ng Pilipinas.
The AMLC says the United States has posted the highest threats to the Philippines.
“With regard to STR volume, the majority of the inflows and outflows of all predicate crimes have been linked to the United States of America,” the AMLC report says.
The council says in terms of peso amounts, most of the incoming criminal proceeds were coursed through various banks in the United Kingdom, while large amounts of outgoing illicit funds were mostly sent to Hong Kong.
The report says commercial banks are the preferred financial channels for the majority of the predicate crimes such as illegal drugs, plunder and corruption, investment scams and estafa, smuggling, violation of indigenous peoples’ rights, the illegal manufacture and possession of firearms and web-related crimes.
“Perpetrators of other predicate crimes primarily use money service businesses [MSBs] in moving the illicit funds,” the council said.
The government has been intensifying its campaign against money laundering in the aftermath of the $81-million money laundering scam that happened in early 2016, the biggest in the country’s history so far.
Cyber thieves stole $81 million from the account of Bank of Bangladesh in the Federal Reserve in New York. The dirty money entered the domestic financial system through the Jupiter Makati branch of Rizal Commercial Banking Corp. using fictitious accounts of some individuals. The money was later on laundered in the local casinos.
For its involvement in the scam, RCBC was fined by the Bangko Sentral an unprecedented P1 billion that was paid by the bank in two tranches.
The Jupiter branch manager was later on convicted, while five other officials were charged in court for their alleged involvement in the scam.
READ: Plea of five RCBC officers in cyber heist of Bangladesh bank junked
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