Secrecy of Bank Deposits
Secrecy of Bank Deposits
AN ACT PROHIBITING DISCLOSURE OF OR INQUIRY INTO, DEPOSITS WITH ANY BANKING INSTITUTION
AND PROVIDING PENALTY THEREFOR.
to give encouragement to the people to deposit their money in banking institutions and to
discourage private hoarding so that the same may be properly utilized by banks in
authorized loans to assist in the economic development of the country.
all deposits, including investments in bonds, issued by the Government of the Philippines are
absolutely confidential nature and may not be examined, inquired or looked into by any
person or government officials.
EXCEPT, upon written permission of the depositor, involved in criminal complaints or
subject in litigation.
it shall be unlawful for any official or employee of a banking institution to disclose to any
person, other than those permitted, any information concerning said deposits or other
financial affairs.
no one can just go to your bank and ask for your bank balance.
all deposits including bond investments issued by the Government of the Philippines.
the bank secrecy law covers only savings, checking and other types of deposits, but not
investments in money markets, trust and mutual funds and the like.
Any violation; imprisonment – not more than 5 years; fine – not more than 20,000 pesos, or both, in the
discretion of the court.
The easiest way to wave Secrecy of Bank deposits is through a written waiver, should be made voluntarily with
sufficient awareness of relevant circumstances and consequences.
to protect its citizens from a lack of awareness of the true cost of credit to the user
by assuring a full disclosure of such cost with a view of preventing the uninformed
use of credit to the detriment of the national economy.
o detriment - Any loss or harm to a person or property; relinquishment of a legal right, benefit, or
something of value. To incur detriment means to cement a promise by either refraining from
doing something that one has a legal right to do or by doing something that one is not under any
legal obligation to do.
a clear statement in writing setting forth, to the extent applicable and in accordance
with rules and regulations prescribed by the Board, the following information:
(1) the cash or delivered price of the property or service to be acquired
(2) the amounts, if any, to be credited as down payment and/or trade-in
(3) difference between clauses (1) and (2)
(4) the charges, individually itemized, which are paid or to be paid by such
person in connection with the transaction but which are not incident to the
extension of credit
(5) the total amount to be financed
(6) the finance charge expressed in terms of pesos and centavos; and
(7) the percentage that the finance bears to the total amount to be financed
expressed as simple annual rate on the outstanding unpaid balance of the
obligation
any creditor, who fails to disclose to any person any information in violation of this
Act shall be liable to such person in the amount of P100 or in an amount equal to
twice the finance charged required by such creditor with such transaction,
whichever is greater, except that such liability shall not exceed P2,000 on any credit
transaction.
action to recover such penalty may be brought by such person within one year from
the date of the occurrence of the violation, in any court of competent jurisdiction.
the creditor shall be liable for reasonable attorney’s fees and court costs as
determined by the court.
violation; fined by not less than P1,000 or more than P5,000 or imprisonment for
not less than 6 months, nor more than one year.
no punishment or penalty provided by this Act shall apply to the Philippine
Government or any agency or any political subdivision thereof.
violation; fined by not less than P1,000 or more than P5,000 or imprisonment for
not less than 6 months, nor more than one year.
AN ACT DEFINING THE CRIME OF MONEY LAUNDERING, PROVIDING PENALTIES THEREFOR AND
FOR OTHER PURPOSES
Money Laundering is a crime whereby the proceeds of an unlawful activity are transacted, thereby
making them appear to have originated from legitimate sources.
to protect and preserve the integrity and confidentiality of bank accounts and to
ensure that the Philippines shall not be used as a money laundering site for the
proceeds of any unlawful activity.
consistent with its foreign policy, the State shall extend cooperation in transnational
investigations and prosecutions of persons involved in money laundering activities
wherever committed.
covered institution
(1) banks, non-banks, quasi-banks, trust entities, and all other institutions and
their subsidiaries and affiliates supervised or regulated by the BSP
(2) insurance companies and all other institutions supervised or regulated by
Insurance Commission
(3) securities dealers, mutual funds, foreign exchange corporations, other
entities administering or otherwise dealing in currency, and other similar
entities supervised or regulated by SEC.
covered transaction – single, series, or combination of transactions involving a total
amount in excess of P4,000,000 or an equivalent amount in foreign currency based
on the prevailing exchange rate within five (5) consecutive banking days
o EXCEPT; those between a covered institution and a person who, at
the time of the transaction was a properly identified client and the
amount is commensurate with the business or financial capacity of
the client; or those with an underlying legal or trade obligation,
purpose, origin or economic justification.
o commensurate - to reduce to a common measure
monetary instrument – coins or currency of legal tender of the Philippines, or of any
other country.
offender – any person who commits a money laundering offense
person – any natural or juridical person
proceeds – an amount derived or realized from an unlawful activity
supervising authority – appropriate supervisory or regulatory agency
transaction – any contractual or legal relationship between the parties thereto
unlawful activities
(1) kidnapping for ransom (Article 267 of Act. No. 3815)
(2) Dangerous Drugs Act of 1972 (Republic Act No. 6425)
(3) Anti –Graft and Corrupt Practices Act (Republic Act No. 3019)
(4) Plunder (Republic Act No. 7080)
(5) robbery and extortion (under RPC)
(6) Jueteng and Masiao (Presidential Decree No. 1602)
(7) Piracy on the high seas (Presidential Decree No. 352)
(8) qualified theft (Art. 310 of RPC)
(9) swindling (Art. 315 of RPC)
(10) smuggling (Republic Act Nos. 455 and 1937)
(11) Electronic Commerce Act of 2000 (Republic Act No. 8792)
(12) hijacking and other violations (Republic Act No. 6235)
(13) fraudulent practices and other violations (Republic Act No. 8799/Securities
Regulation Code of 2000)
(14) felonies or offense s of a similar nature that are punishable under the penal
laws of other countries
any person knowing that any monetary instrument or property represents, involves,
or relates to, the proceeds of any unlawful activity, transacts or attempts to transact
said monetary instrument property.
any person knowing that any monetary instrument or property involves proceeds of
any unlawful activity, performs or fails to perform any act as a result of which he
facilitates the offense of money laundering referred to in paragraph above.
any person knowing that any monetary instrument or property is required under
this Act to be disclosed and filed with the Anti-Money Laundering Council (AMLC),
fails to do so.
VI. Apply the illustrate preventive measures and obligations of covered persons
“Beneficial owners” refers to those individuals or natural persons who ultimately own or control
the customer, or those for whom another person conducts a transaction. Money launderers and
terrorists routinely use the cloak of anonymity to prevent the AMLC and law enforcement agencies
(LEAs) to track them down.
General Requirement for BOV. Covered persons shall identify the beneficial
owner and take reasonable measures to verify the identity of the beneficial owner,
using the relevant information or data obtained from a reliable sources, such that
the covered person is satisfied that it knows who the beneficial owner is.
Document Evidencing Relationship. Covered persons shall determine the true
nature of the beneficial owner’s capacities and duties vis-à-vis his agent by
obtaining a copy of the written document evidencing their relationship and apply
the same standards for assessing the risk profile and determining the standard of
CDD to be applied to both.
Timing of BOV. Covered persons shall verify the identity of the beneficial owner
before or during the course of establishing a business or professional relationship,
or conducting transactions for occasional customers in excess of the threshold. They
may complete the BOV after the establishment of the business or professional
relationship; Provided, that:
(1) this occurs as soon as reasonably practicable;
(2) this is essential not to interrupt the normal conduct of business; and
(3) the ML/TF risks are effectively managed.
BOV for Juridical Persons. For customers that are juridical persons, the covered
persons shall identify and take reasonable measures to verify the identity of
beneficial owners through the following information:
(1) the identity of the natural persons, if any, who ultimately have
controlling ownership interest in a juridical person;
(2) to the extent that there is a doubt under item above, as to whether
the persons with the controlling ownership interest are the
beneficial owners or where no natural person exerts control through
ownership interests, the identity of the natural persons, if any,
exercising control over the juridical person through other means;
and
(3) where no natural person is identified under items (1)and (2) above,
the identity of the relevant natural persons who hold senior
management positions.
BOV for Legal Arrangements. For customers that are legal arrangements, the
covered person shall identify and take reasonable measures to verify the identity of
beneficial owners through the following information:
(a) For trust agreements: the identity of the trustors/grantors/settlors,
the trustees, the beneficiaries or class of beneficiaries, the protector,
if any, and any other natural person exercising ultimate effective
control over the trust agreement.
(b) For beneficiaries of trust agreements that are designated by
characteristics or by class: sufficient information concerning the
beneficiary to satisfy the covered person that it will be able to
establish the identity of the beneficiary at the time of the payout or
when the beneficiary intends to exercise vested rights.
(c) For other types of legal arrangements: the identity of persons in
equivalent or similar positions.
Guidelines on Beneficial Ownership. The AMLC shall formulate guidelines on the
detailed implementation of the requirements on BOV.
Record-Keeping. Covered persons shall maintain and safely store for five (5) years
from the dates of transactions all customer records and transaction documents.
Closed Accounts and Terminated Relationships. Covered persons shall keep all
records obtained through CDD, account files and business correspondence, and the
results of any analysis undertaken, for, at least, five (5) years following the closure
of account, termination of the business or professional relationship or after the date
of the occasional transaction.
Retention of Records Where there is a Case. If a case has been filed in court
involving the account, records must be retained and safely kept beyond the five (5)-
year period, until it is officially confirmed by the AMLC Secretariat that the case has
been resolved, decided or terminated with finality.
Form of Records.
o Complimented by the requirements under the 2018 Guidelines on
Digitization of Customer Records, covered persons shall retain all
transaction records either in:
(1) their original forms; or
o Covered persons shall keep the electronic copies of all CTRs and STRs for, at
least, five (5) years from the dates of submission to the AMLC.
o For low risk customers, covered persons shall maintain and store, in
whatever form, a record of information data and transactions, sufficient to
permit reconstruction of individual transactions so as to provide, if
necessary, evidence for prosecution of criminal activity.
Availability of Records.
(1) Covered persons shall ensure that all CDD information and
transaction records are available swiftly to domestic competent
authorities in the exercise of their official functions or upon order by
a competent authority.
No administrative, criminal or civil proceedings shall lie against any person for
having made a CTR or an STR in the regular performance of his duties and in good
faith, whether or not such reporting results in any criminal prosecution under the
AMLA or any other Philippine law.
SEC. 5. Jurisdiction of Money Laundering Cases – The regional trial courts shall have jurisdiction to try
all cases on money laundering. Those committed by public officers and private persons who are in
conspiracy with such public officers shall be under the jurisdiction of the Sandiganbayan.
Anti-Money Laundering Council (AMLC) – Governor or BSP as chairman, the Commissioner of the
Insurance Commission and the Chairman of the SEC as members.
Secretariat – headed by an Executive Director for a term of five (5) years. He must be a member of a
Philippine Bar, at least thirty-five (35) years of age and of good moral character, unquestionable
integrity and known probity. All members of the Secretariat must have served at least five (5) years
either in the Insurance Commission, the SEC, or BSP and shall hold full-time permanent positions
within the BSP.
Section 10. Authority to Freeze. Upon determination that probable cause exists that any deposit or
similar account is in any way related to unlawful activity, the AMLC may issue a freeze order, which
shall be effective immediately, on the account for a period not exceeding fifteen (15) days. Notice to
the depositor that his account has been frozen shall be issued simultaneously with the issuance of the
freeze order. The depositor shall have seventy-two (72) hours upon receipt of the notice to explain why
the freeze order should be lifted. The AMLC has seventy-two (72) hours to dispose of the depositor’s
explanation. If it fails to act within seventy-two (72) hours from receipt of the depositor’s explanation,
the freeze order shall be automatically be dissolved. The fifteen (15)-day freeze order of the AMLC may
be extended upon order of the court, provided that the fifteen (15)-day period shall be tolled pending
the court’s decision to extend the period. No court shall issue a temporary restraining order or writ of
injunction against any freeze order issued by the AMLC except the Court of Appeals or the Supreme
Court.
(Sec. 4a) imprisonment ranging from seven (7) to fourteen (14) years; fine of not less
than three million pesos (P3,000,000) but not more than twice the value of the
monetary instrument or property involved in the offense.
(Sec. 4b) imprisonment from four (4) to seven (7) years; fine not less than one million
five hundred thousand pesos (P1,500,000) but not more than three million
pesos (P3,000,000).
(Sec. 4c) imprisonment from six (6) months to four (4) years; fine of not less than one
hundred thousand pesos (P100,000) but not more than five hundred thousand
pesos (P500,000)
Penalties for Failure to Keep Records; imprisonment from six (6) months to one (1) year; fine of not
less than one hundred thousand pesos (P100,000) but not more than five hundred thousand pesos
(P500,000), or both. (Sec. 9b)
Malicious Reporting; six (6) months to four (4) years imprisonment; fine of not less than one hundred
thousand pesos (P100,000) but not more than five hundred thousand pesos (P500,000). The offender is
not entitled to avail the benefits of the Probation Law.
Corporation – responsible officers; Juridical person – suspend or revoke its license; alien –
deported; Public official or employee – perpetual or temporary absolute disqualification from
office.
Breach of Confidentiality; imprisonment ranging from three (3) to eight (8) years; fine of not less than
five hundred thousand pesos (P500,000) but not more than one million pesos (P1,000,000). (Sec. 9c)
SEC. 19. Implementing Rules and Regulations. Within thirty (30) days from the effectivity of this Act,
the BSP, IC, and SEC shall promulgate the rules and regulations to implement effectively the provisions
of this Act. Said rules and regulations shall be submitted to the Congressional Oversight Committee for
approval.
Congressional Oversight Committee – seven (7) members from the Senate (shall be appointed by the
Senate President) and seven (7) members form the House of Representatives (shall be appointed by the
Speaker).
The provisions of this Act shall not apply to deposits and investments made prior to its effectvity.