Senators reject conditional Palace certification for AMLA amendment

Published December 16, 2020, 7:11 PM

by Vanne Elaine Terrazola

Senators on Wednesday rejected the conditions set by Malacañang in certifying as urgent the bill that would further amend the Anti-Money Laundering Act (AMLA) of 2001.

(Senate of the Philippines / MANILA BULLETIN)

The Senate received from the Palace President Duterte’s certification of Senate Bill No. 1945 “in order to address the strategic deficiencies in our anti-moeny laundering and countering terrorism financing legal framework and avoid adverse findings against the country.”

It comes at a time as international watchdog Financial Action Task Force (FATF) recommended the strengthening of the country’s AMLA to prevent the Philippines from being grey-listed or tagged as high-risk for money laundering or terrorism financing.

Senators, however, were surprised after the President’s certification included certain conditions, which they noted was a first.

“This certification, however, is subject to the proposed reduction of the threshold for tax crimes to [P20 million], retention of the prevailing reporting threshold for real estate transactions, and grant of the requested additional investigative powers to the Anti-Money Laundering Council as reflected in House Bill No. 7904 which was recently passed by the House of Representatives,” Duterte said in his letter to Senate President Vicente Sotto III dated December 15, 2020.

“I believe that these provisions are absolutely essential to achieving the objectives of this bill,” he added.

“Actually, Mr. President, this is the first time I have seen a certification with conditions, and possible amendments,” Senate Majority Leader Juan Miguel Zubiri said after Senator Panfilo Lacson raised the matter during their plenary session.

“I don’t think it will qualify as a letter of certification as far as the Senate is concerned because it violates the separation of powers,” Senate President Vicente “Tito” Sotto III said.

“In other words, Mr. President, without showing any signs of disrespect to Malacañang, we’ll just do our job with regard to SB 1945,” Lacson said.

Sotto then affirmed: “Correct. We will approve what the members of the Senate want to approve as a far as the second reading is concerned.”

Later in the session, Sotto said it is “impossible” to pass the SB No. 1945 on third and final reading on their last session day, Wednesday, as he maintained that “there is no certification.”

“Because the type of certification we received is not the type of certification that is allowed in the Senate,” he said.

Sen. Grace Poe, chairperson of the Senate banks committee and sponsor of SB No 1945, said that while the legislative department usually consult members of executive department in crafting laws, she was “a little bit bothered by those conditions, precisely because I feel, I know, that the President and Malacañang have expressed always the separation of powers [between] the executive and the legislative and the judiciary.”

“By putting those conditions… It basically tells us to pass that version alone if we really want this bill to be qualified for that certification so in short, nakadikta po dito kung ano dapat ang probisyon na dapat nating ipasa (this dictates upon us what we should be passing),” Poe said.

“Indeed, there are times when the executive department would whisper their wishes on certain pieces of legislation. But it is never written down in black and white. This is the first time that it is done,” Sotto said.

“I don’t think it will be [good] to the democratic process to just pass this bill based on what is written in this certification,” Poe added.

Poe assured that she will submit to her colleagues’ decision in coming up with the provisions of their version of the bill amending the AMLA.

“It’s important that we pass this measure to avoid being included in the grey list, but we also do not want to be dictated upon by foreigners or others on what we should be doing,” she said in Filipino.

Under bill endorsed by the Senate banks committee, a threshold of P50 million and above was set for violation of tax laws, but there must be a finding of fraud or malicious and willful misrepresentation on the part of the tax violator.

The bill also sought the inclusion of real estate developers and brokers engaged in a single cash transaction of in excess of P5 million as covered persons; as well as Philippine Offshore Gaming Operators (POGO) and service providers.

The Senate banks committee agreed to strengthen the functions of the Anti-Money Laundering Council (AMLC), by enhancing its investigative powers, authorizing it to impose targeted financial sanctions on proliferation financing; and to preserve, manage or dispose assets and stop the issuance of injunctive relief against freeze orders and forfeiture proceedings.

Senators, however, thumbed down the AMLC’s request for the grant of subpoena powers for fear of that it will be abused.

“We didn’t give too much power to the AMLC because some of those things might be in violation of our basic rights,” Poe explained earlier.