SEN. GRACE POE's SPONSORSHIP SPEECH TRANSCRIPT
AMLA Amendments Bill

Before us is an important measure that requires our immediate attention. We are implored to immediately act on it by the Asia Pacific Group on Money Laundering, "as a form of national economic emergency, due to the very serious economic costs" arising from non-compliance.

This measure, which seeks to further amend the Anti-Money Laundering Act of 2001, was crafted as a response to the key findings of the mutual evaluation report or MER which evaluated our compliance with the 40 recommendations of the Financial Action Task Force on Money Laundering.

If we fail to act now, the FATF ICRG Asia Pacific Joint Group or AP-JG will place the Philippines in the so-called "grey list", along with countries like Albania, Pakistan, Panama, Syria, Uganda, and Zimbabwe, to name just a few.

Being on this list is a very strong signal to market participants and regulators globally. It has implications which we must avoid as much as we can, especially during the time of a global pandemic:

a. For instance, other member-countries and the whole of the European Union will impose an "enhanced due diligence" or EDD on Filipino nationals and businesses that transact within their channels. This will result in additional cost, paperwork, higher interest rates and processing fees for Filipinos who are doing business within the jurisdiction of EU.

b. The EDD will also affect numerous overseas Filipino workers as it would translate to a higher cost of remittance from them. Ang pinaghirapang pera na nakalaan sana para sa panggastos ng kanilang pamilya ay mapupunta na lamang sa mas mataas na remittance fees.

c. To make matters worse, the Philippines will incur a "reputational risk" that would certainly result in reduced investor and lender confidence. We can only imagine the domino effect that this would trigger to all of our local industries.

d. All of these things will be a major setback in our efforts to achieve an "A" credit rating before 2022. This is a scenario that we have to steer away from.

Allow me to briefly explain to the body the salient features of this proposed measure which were expertly reviewed and improved with the help of all stakeholders, and our fellow Senators Drilon, Marcos, Villar, Gatchalian and Recto who participated in the committee hearing:

First, the MER recommends to include real estate developers and brokers as covered persons because of the fact that real estate activities are widely used as a front for money laundering and terrorism financing all over the world. Thus, we include real estate developers and brokers in the list of covered persons when they engage in a single cash transaction of in excess of P5 million or its equivalent in any other currency. To clarify the coverage of internet-based casinos, we also expressly specified the coverage of offshore gaming operators and their service providers.

Second, we included the commission of tax crimes and violation of the Strategic Trade Management Act, which relates to the proliferation of weapons of mass destruction and its financing, as predicate offenses to money laundering.

Third, we improved the functions of the AMLC by (1) enhancing its investigative powers through express powers of deputization, power to apply for search warrant, and power to obtain information on ultimate beneficial ownership; (2) authorizing it to implement targeted financial sanctions on proliferation financing; (3) authorizing it to preserve, manage or dispose assets subject of asset preservation order and judgement forfeiture; and (4) prohibiting the issuance of injunctive relief against freeze orders and forfeiture proceedings under its jurisdiction.

And for purposes of providing clarity as to the scope and applicability, this measure includes a definition of the terms "proliferation financing", "offshore gaming operator", "service providers", "real estate broker", "real estate developer", and "targeted financial sanctions".

I would like to take this opportunity to express my utmost gratitude to Sen. Franklin Drilon and his team for generous contributions during the drafting of this bill. His invaluable assistance is truly instrumental in the realization of our collective goal to make the Philippines a true global partner against money laundering.

Fellow senators, we are given a very limited time to act on the measure. It is in this light that I endorse to this chamber for deliberation, Senate Bill No. 1945, under Committee Report No. 149.