ON MONEY LAUNDERING
the following rules and regulations for banks and non-bank financial
institutions under the supervision and regulation of the Bangko Sentral
ng Pilipinas (BSP) are hereby issued in order to combat money
laundering:
1. When establishing business relations or conducting
transactions (particularly opening of deposit accounts, accepting
deposit substitutes, entering into trust and other fiduciary
transactions, renting of safety deposit boxes, performing remittances
and other large cash transactions), banks/Non-Bank Financial
Institutions (NBFIs) should take reasonable measures to establish and
record the true identity of their clients. Said client identification
may be based on official or other reliable documents and records.In cases of corporate and other legal entities, the following measures should be taken, when necessary:
a. Verification of the legal existence and structure of the
client from the appropriate agency or from the client itself or both,
proof of incorporation, including information concerning the customer’s
name, legal form, address, directors, principal officers and provisions
regulating the power behind the entity.b. Verification of the authority and identification of the person purporting to act on behalf of the client.
2. In case of doubt as to whether their purported clients
or customers are acting for themselves or for another, reasonable
measures should be taken to obtain the true identity of the persons on
whose behalf an account is opened or a transaction conducted.3. Unless otherwise prescribed under existing laws,
anonymous accounts or accounts under fictitious names should not be
kept/allowed. In case where numbered accounts is allowed (i.e. foreign
currency deposits), banks/NBFIs should ensure that the client is
identified in an official or other identifying documents.4. The identity of existing clients or beneficial owners
of deposits and other funds held or being managed by the bank should be
renewed/updated at least every other year.5. All necessary records on transactions, both domestic or
international, should be maintained for at least five (5) years. Such
records must be sufficient to permit reconstruction of individual
transactions so as to provide, if necessary, evidence for prosecution of
criminal behaviour.Records on customer identification, account files and business
correspondence should be kept for at least five (5) years after the
account is closed.6. Special attention should be given to all complex,
unusual large transactions, and all unusual patterns of transactions,
which have no apparent or visible lawful purpose. The background and
purpose of such transactions should, as far as possible, be examined,
the findings established in writing, and be available to help
supervisors, auditors and law enforcement agencies.If there is reasonable ground to believe that the funds are
proceeds of a criminal or other illegal activity, they should be
reported to competent authority, without violating any law. If the fund
is held as deposit, the account should be closed.7. Other suspicious transactions not involving deposits should be reported to competent authorities.
8. Banks/NBFIs should not, or should at least avoid,
transacting business with criminals. Reasonable measures should be
adopted to prevent the use of their facilities for laundering of
proceeds of crimes and other illegal activities.9 Programs against money laundering should be developed. These programs should include, as a minimum:
a. The development of internal policies, procedures and
controls, including the designation of compliance officers at management
level, and adequate screening procedures to ensure high standards when
hiring employees;b. An ongoing employee training program; and
c. An audit function to test the system.
This Circular shall take effect immediately.
Adopted: 7 July 2000
(SGD.) RAFAEL B. BUENAVENTURA
Governor