BSP chief defends AMLC ‘inaction’

Critics of the Anti-Money Laundering Council (AMLC) may have mistaken its silence in performing its task for lack of accomplishment, Bangko Sentral ng Pilipinas ( BSP) Governor Amando Tetangco Jr. said yesterday as he defended the inter-agency body from allegations that it has not been cooperative in government efforts to build up cases against suspected drug offenders.

“By the nature of the work of AMLC, we do not divulge the activities of the AMLC. Unfortunately, some people have mistaken this as a lack of accomplishment,” Tetangco told members of the Rotary Club of Manila. He also said the BSP and the AMLC are two different institutions.

“There seems to be some misunderstanding here. AMLC is not the BSP nor the BSP the AMLC. These are two different institutions,” he said.

The BSP chairs the AMLC while the heads of the Securities and Exchange Commission (SEC) and the Insurance Commission (IC) sit as members.

He explained AMLC has been structured in such a way that covered institutions are supervised by their respective regulators like the SEC for the corporates, the IC for insurance firms and the BSP for banks.

“The operations of AMLC are completely different from the operations of the BSP. Although most of the institutions covered by AMLC are also supervised by the BSP and I am referring to the banks,” he added.

Tetangco said the AMLC is mandated by the Anti-Money Laundering Act (AMLA) not to divulge its activities.

Tetangco, who is being considered to serve an unprecedented third term upon the recommendation of Finance Secretary Carlos Dominguez III, pointed out that efforts of the AMLC are being recognized in other countries.

“But on the contrary if you look at what the other international institutions and other financial intelligence units around the world… they have good words to say about the performance of AMLC in the Philippines,” he said.

Legislators are pushing for amendments to the country’s anti- money laundering law after the Philippines became involved in a scandal that resulted in the loss of $81 million from the account of the Bangladesh Bank in the Federal Reserve Bank of New York.

“The cyber crime did not really take place here, it happened overseas. The hacking was done abroad, what came here were the proceeds of the hacking,” he said.

Last February, the funds stolen by hackers entered the Philippines using Rizal Commercial Banking Corp. (RCBC) as conduit before the funds were laundered through casinos, which are not among the covered institutions under the AMLA.

“It is not only the Philippines that is involved here. There is Bangladesh itself, the US through the New York Fed, and the casinos here in the Philippines. When you look at this particular case, you have to look at the complete picture,” he said.

It is on record, he stressed, that it was actually AMLC that took the first step to go after those responsible for the cyber heist.

“So I think we have done what we are supposed to do there. We have been able to return part of the money that was lost by the Bangladesh Bank. About $15 million has been returned,” he said.

Likewise, the BSP’s Monetary Board imposed a record P1-billion fine against RCBC for violating several provisions of the law.

The AMLC, on the other hand, has filed cases against several RCBC officials as well as others involved in the electronic bank heist.

“To the extent that there were violations of banking laws here in the Philippines, sanctions have been imposed. So we have taken actions. I am not sure what actions have been taken by the Bangladesh government,” he said.

After the scandal, RCBC president and CEO Lorenzo Tan was replaced by Gil Buenaventura. RCBC treasurer Raul Victor Tan and the bank’s head of legal and regulatory affairs Ma. Cecilia Fernandez- Estavillo also resigned.

Tetangco, who remains mum on a possible third term, said there are qualified individuals, including current BSP deputy governors, who are also qualified to serve as the next central bank chief.