Senator Richard Gordon bewailed the failure of the Anti-Money Laundering Council to act promptly on money laundering cases, denouncing it as an example of “bureaucracy in its worst form.”
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At the resumption of Senate Blue Ribbon hearings on the operations of Philippine Offshore Gaming Operators (POGOs), Gordon asked AMLC officials why they failed to act on a Bureau of Customs report that a certain individual was caught for the non-declaration of $700,000 in cash in 2019.
A visibly irritated Gordon berated AMLC officials and told them that once they were notified, they should have acted immediately as it could be a case of money laundering.
AMLC Executive Director Mel Racela said they cannot immediately declare that the funds were laundered as they have to “assume good faith” based on the reasons cited for carrying huge amount like travel, casino, business, and investments, among others.
But Gordon rejected Racela’s explanation, saying AMLC’s failure to act fast could lead to corruption.
“You defeat the purpose of the law. Don’t you think AMLC has to correct this? Once they cannot establish provenance of the money, that’s money laundering,” he said.
Gordon and Senate Minority Leader Franklin Drilon said they were baffled over the billions suspiciously brought into the country by 60 individuals, mostly POGO workers, which was pegged at $633 million or over P32 billion in cash from September 2019 to March 2020.
In an interview after the hearing, Gordon said it was likely that President Rodrigo Duterte was not properly informed about what he described as “the creeping invasion” of POGOs and the crimes they bring.
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The two senators both cited the adverse impact of POGOs in various sectors.
Victor Padilla, senior manager, Anti-Money Laundering Complaint Department of the Philippine Amusement and Gaming Corp., which regulates POGO operations, said they are addressing all the negative effects of POGO in the country.
To this, Drilon commented, “Good luck.”
Quizzed by Drilon why Chinese POGOs are allowed to operate in the Philippines when they were banned in China, Padilla noted that all players come from China.
He also told Drilon PAGCOR conducts random inspections once they receive reports about a POGO operating without a license.
Drilon earlier questioned Padilla how PAGCOR addressed reports that more than 100 POGOs out of the 240 have been illegally operating in subdivisions.
In the same hearing, Racela said AMLC flagged some P14 billion in “suspicious transactions” within a two-year period (2017-2019) in connection with offshore gaming operations in the country.
Based on the findings of AMLC’s risk assessment report on POGOs, among the alleged dubious transactions are drug trafficking, fraud, and violations of the country’s electronic commerce law.
“There is no sense in continuing this POGO operations licensing,” Drilon said, citing the social problems triggered by the industry.
“It’s not worth what we see as [its] adverse effects on our society,” he added.
Drilon criticized the government’s gambling regulators for focusing on revenues from the POGO industry, saying it “indicates the kind of mindset we have.”
“Such a short-term, short-gain statement,” he said.
One alleged syndicate he identified as the Rodriguez family had total transactions of $283 million from July 2019 to March 2020.
He pointed out that the POGO industry, which targets Chinese citizens, employs thousands of Chinese nationals, some of them illegally, amid Beijing’s declaration that any form of gambling is unlawful.
Meanwhile, Gordon said there are at least four syndicates, including the Rodriguez family, whose multimillion-dollar transactions were presented during the hearing. He said the Rodriguez family brought in a total of $283 million from July 2019 to March 2020.
He said a certain Elizabeth Rodriguez, for instance, brought in a total of $42 million from 58 transactions.
“What’s happening here is scary, and it appears there really is a syndicate,” said Gordon, as he presented a video prepared by residents of Multinational Village in Parañaque City, showing how the influx of Chinese nationals was taking its toll on their village.
The residents complained of poor sanitation, a firing range, and 100 to 200 Chinese allegedly staying in one house. One of them also cited power outages because of the increase in the load limit.
“It’s not safe anymore. That’s what we are most worried about,” one resident said.
The central bank is currently investigating at least two money service businesses due to irregularities based on the recommendation of AMLC.
Senator Panfilo Lacson said the bringing in of huge sums of money with impunity calls for urgent action, not just by the executive, but also by the legislative branch of government.
Lacson, a former police chief, said authorities should keep up with, if not keep one step ahead of, criminals.
Congress, meanwhile, must take a look at gaps in existing laws, including the Bank Secrecy Law and the Anti-Money Laundering Act. Amendments to these laws, however, should also make sure they cannot be misused for political purposes.
“Speaking from experience, I have been at the receiving end of such abuse of the law,” Lacson said.
The Palace on Thursday said it is up to the lawmakers to update laws covering money laundering amid the suspicious entry of millions of dollars into the country.
“I do not know if it will be certified as urgent, but if that is the Department of Finance’s position and it can support its position, the President usually listens and supports it,” Presidential Spokesman Salvador Panelo said in a Palace briefing. With MJ Blancaflor
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