Bangko Sentral ng Pilipinas (BSP, Central Bank of the Philippines) is probing several banks to look for irregularities that may have supported possible illegal transactions made by Filipino businesswoman Janet Lim Napoles, seen as the mastermind behind the Php10-billion pork barrel scam.
BSP is looking for possible violations as to the approvals for withdrawal made by banks where Napoles had accounts, and determine if banks have violated the Know-Your-Customer (KYC) rule.
The rule requires banks to check the legitimacy of their clients to see if the account is being used for illegal purposes, particularly money laundering.
“It’s too early to state if they failed the KYC process but we will look into that. They will be investigated,” said Mel Racela, deputy director of BSP’s Anti-Money Laundering Specialist Group.
Banks that fail to report suspicious transactions of its clients to the government will face fines, BSP said.
According to Racela, BSP requires banks to follow strict KYC procedures, including face-to-face meetings with bank officials and proper client identification.
Racela also said the central bank requires all banks to conduct risk profiling where high ranking government officials, including the central bank’s own officials, and clients who deal with these officials are classified as “high risk”.
BSP Deputy Governor Nestor A. Espenilla Jr. did not identify banks they were probing, but said they are looking at information coming out of public hearings.
“No single entity is targeted. We’re looking at the information coming out of public hearings. That’s the guide the BSP is using in determining compliance with AMLA (Anti-Money Laundering Act),” he said.
Lorenzo Tan, president of the Bankers Association of the Philippines (BAP), said the organization is “working vigorously with its members to ensure full compliance with AMLA laws and regulations.”
He said the BAP will fully cooperate with the Anti-Money Laundering Council (AMLC) in its investigations on Napoles’ numerous bank accounts.
The AMLC requires banks to report transactions of greater than Php500,000.00, and determines if the transaction originated from a criminal offense leading to money laundering.
The Court of Appeals, on the recommendation of the AMLC, froze 344 bank accounts, 66 insurance policies, and five credit card accounts of Napoles and her relatives, cohorts, and bogus organizations.
Napoles allegedly diverted Php10-billion from lawmakers’ pork barrels to her organizations.
(with reports from The Philippine Inquirer and The Manila Bulletin)