The Anti-Money Laundering Council is looking to freeze more bank accounts linked to an ongoing anomalous flood control project scandal on top of more than 700 accounts that have already been frozen, Bangko Sentral ng Pilipinas (BSP) Governor and AMLC chairman Eli Remolona Jr. said.
Remolona made the comments in an interview with One News’ Money Talks aired on Friday, confirming the AMLC’s widening investigation.
“We’ve frozen over 700 accounts so far. We’re looking at more accounts to freeze,” Remolona said.
He acknowledged that the large-scale freezes could affect liquidity, but assured the public of the financial system’s stability.
“So that does affect liquidity in general. But our banks are very, very liquid at this point. I think I can say that with confidence, no bank runs,” he said.
Remolona also expressed shock at the extent of the corruption, specifically the large volume of cash transactions involved.
“The sight of piles of cash on the table, that’s kind of shocking. I didn’t know this was all done in cash, in such amounts. That is shocking,” he said.
He said to curb the risk of money laundering related to the scandal, the BSP recently issued a regulation limiting large-value cash transactions to P500,000.
“We wanted to make it more difficult for the contractors, for the guys involved in this flood control mess, to be able to take money out of the banks. We just realized that all these transactions are done in cash,” Remolona said.
The move has faced public criticism regarding its potential inefficiency for businesses and individuals with legitimate cash needs exceeding the limit.
Remolona clarified that withdrawals over the limit are still permitted, provided the client could justify the purpose of the transaction.
“We understand that there are businesses that are really cash-based. And I think banks also know that. The businessman can come to a bank and say, I need cash, more than P500,000, and this is why I need the cash. And the bank will understand that,” he said.
The BSP has also begun inquiries into bank accounts with suspiciously large transactions, Remolona confirmed.
“We’re trying to identify the big flows of cash throughout the financial systems, unusually large flows of cash. But not just cash, any financial transaction that looks unusual. We’re trying to analyze,” he said.
Most of the suspicious activity observed so far has been traced back to government-owned financial institutions, he said.
“I think more from the government financial institutions. And that makes sense because it’s government money, so it would go through government financial institutions. So that’s what we’ve seen so far,” Remolona said.
