By Madelaine B. Miraflor The problem about the country's Securities and Exchange Commission (SEC) being a full member of International Organization of Securities Commission (IOSCO) is that somebody has to adjust. It's definitely not the country's legislative body. It's been years since the SEC first started working on its full membership at IOSCO — a global association of securities and futures market regulators — and SEC Chairperson Teresita Herbosa is still far from giving up. The problem is that the Philippines can’t be an IOSCO member unless changes will be made in the country's Bank Secrecy Law. According to the rules of IOSCO, a corporate regulatory watchdog should be able to scrutinize bank records of people engaged in frauds. That, of course, will not happen in the Philippines, with the strong influence of the country’s capitalists and wealthy politicians both in the legislative process and judiciary system. And since the proposed changes in the Bank Secrecy Law was faced with too much criticism, SEC resorted to SRC amendments, which Herbosa now hopes to be passed in 2018. "We need to pass the SRC amendments because we were able to vet our amendments with the standards of IOSCO. By the end of 2018, I hope SRC amendments would already be approved," Herbosa told Busness Bulletin. Herbosa said that one of the setbacks that the SEC has always been facing is its inability to prosecute violators of the Securities Regulation Code (SEC) as well as to look at the bank records of businessmen accused of fraud. "Even if we have very good lawyers, we really do get delayed or obstructed by our Bank Secrecy Laws. We still cannot trace the money trail all the way up to the accounts to which the funds were transfered or from which funds were used for insider trading, or price manipulation, so it's really been quite a hindrance for us," Herbosa said. Setting the record straight, she admitted that "investigations really takes long" in this country. "That's because you have to have all the trade reports, all the transactions, and remember, if it involves something criminal, you have to try to build up the case in such a way that when it goes to court, you could prove beyond reasonable doubt and it's very difficult because of Bank Secrecy Laws," Herbosa stressed. "Another thing is we don't have civil enforcement unlike elsewhere whereas you can file a civil case and ask for damages such that the dependant would have no choice but to settle or pay up. That would ensure culture of compliance among participants," she added. Another feature of the amended SRC is empowering the SEC to file civil cases against the violator of the SRC instead of criminal cases. SRC or Republic Act (RA) 8799 provided for the SEC reorganization to give greater focus on the Commission’s role in capital market development, fostering good Corporate Governance and enhancing investor protection. The SRC also defined in clear terms fraud and criminal offenses related to securities transactions, and strengthened SEC regulatory functions over all entities dealing in securities such as Self-Regulatory Organizations (SROs) or the Philippine Stock Exchange (PSE), Philippine Dealing and Exchange Corporation (PDEx) and Capital Market Integrity Corporation (CMIC), as well as market professionals such as brokers and dealers, among others.