Anti-Money Laundering Council (AMLC) Resolution No. 24 dated 18 March 2009

Entral na na

SUPERVISION AND EXAMINATION SECTOR OFFICE oF THE DEPUTY GOVERNOR

CIRCULAR LETTER NO. CL-2009- 037

TO Alt Banks and Non-Bank Financial Institutions Under BsP Supervision

Subject Anti-Money Laundering Council (AMLC) Resolution No.24 dated 18 March 2009

March 2009 amending Resolution No. 58 dated 25 May 2005 by excluding under Sections 7(1) and 9 of Republic Act No. 9160, otherwise known as the "Anti- Money Laundering Act of 2001", as amended, issued Resolution No. 24 dated 18 "non-cash, no/low risk" transactions, for which reporting of covered transaction was deferred and covered under Circular Letter dated 16 June 2005. "transactions between banks and government agencies" from among the The Anti-Money Laundering Council (AMLC), in the exercise of its authority

involving government officials and other persons. Council Secretariat's (AMLCS) investigations, however, demonstrate the need to reguire covered institutions to submit covered transaction reports (CTRs) relating to government disbursements managed via a reimbursement system or the Modified Disbursement System (MDS) and other transactions relating to funds and revenues increase the ability of the AMLC to effectively and fully determine the source and ultimate destination of funds relating to certain reports of graft and corruption collected by government agencies. "transactions between banks and government agencies" is necessary to Recent relevant discoveries noted in the course of Anti-Money Laundering Hence, the submission of CTRs on

of the various units of the Government, including a department, bureau, office government or a distinct unit therein. In addition, a transaction is defined as any act establishing any risht or obligation or giving rise to any contractual or legal by any means with a covered institution. instrumentality. or government-owned or controlled corporations, or a local relationship between the parties thereto. it also includes any movement of funds For the guidance of covered institutions, a government agency refers to any

Resolution No. 58 dated 25 June 2005 to read as follows: In view thereof, the AMLC resolved to amend dispositive portion of AMLC

Defer reporting by covered institutions to AMLC of the following

"non-cash, no/low risk covered transactions":

Transactions between banks and the BSP: Transactions between banks operating in the Philippinesj

A. Mabini St.. Malate 1004 Manila. Philippines Trunkline (632) 524-70-11 URL.: www.bsp.gov.ph # e-mail: bspmail hsp.go"ph PANANALAPING MATATAG, BANSANG PANATAG

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Internal operating expenses of the banks: Transactions involving transfer of funds from one deposit Roll-overs of placements of time deposits; and Loan/interest principal payment debited against borrower's within the same bank; account to another deposit account of the same person deposit account maintained with the lending bank.

"2. Requestthe BSP-supervisedinstitutions, through the

categories of "non-cash, no/low risk covered transactions." Association of Bank Compliance Officers (ABCOMP): to determine and report to the AMLc the specific transactions falling within the purview of the aforesaid BSP-identified

guidance and strict implementation. Attached is a copy of AMLC Resolution No. 24 dated 18 March 2009 for your

NESTOR A.ESPENIN JR

Deputy Governor

D 000

Att.: A/S

Bangko Sentra! ng Pilipinas Complex Anti-Money Laundering Council Manila, Philippines

ResoLution no. 2*

Series of 2009

transactions between banks and government agencies. exercise of its authority under Sections 7(1) and 9 of Republic Act No. 9160, otherwise known as the "Anti-Money Laundering Act of 2001", as amended, issued Resolution No: 58 directing banks to defer the submission of "non-cash, no/low risk covered "transactions," including On 25 May 2005, the Anti-Money Laundering Council, in the

reporting (STR) regime in the Philippines and FATF's belief that reducing the number of CTRs would allow the Anti-Money Laundering Council to more effectively analyze the STRs and CTRs received. concern of the President of the Financial Action Task Force (FATF) that "enormous amount" of covered transaction reports (CTRs) that are not related to cash is seriously hampering the overall suspicious transaction The aforementioned Resolution was promulgated in light of the

determine the source and ultimate destination of funds relating to certain persons coveredinstitutionsto submitCTRsrelatingto necessary to increase the ability of the AMLC to effectively and fully reports of graft and corruption involving government officials and other Secretariat's investigations, however, demonstrate the need to require disbursements managed via a reimbursement system or the Modified Disbursement System (MDS) and other transactions relating to funds and revenues collected by government agencies. Hence, the submission of CTRs on transactions between banks and government agencies is Recent relevant discoveries noted in the course of AMLC government

to any of the various units of the Government, inciuding a department bureau, office, instrumentality, or government-owned or controlfed corporations. or a local government or a distinct unit therein. 1 a transaction is defined as any act estabiishing any right or obligation or giving rise to any contractual or iegal relationship between the parties thereto. It aiso inciudes any movement of funds by any means with e covered institutjon. For guidance of covered institutions, a government agency refers I in addition

Executive Croer No. 292. otherwise knowr. as the. "a.dministrative. Coas of 1957 Section 3(n; of the AMLA, as amended

THE COUNCIL RESOLVED TO:

2005 to read as follows: {i). Amend the dispositive portion of Resolution No. 58, Series of

amended, and its Revised Implementing Rules and known as the Anti-Money Laundering Act of 2001, as Regulations, resolved to: Sections 7(1) and 9 of Republic Act No. 9160, otherwise "The Council, in the exercise of its authority under

Defer reporting by covered institutions to AMLC of the following transactions": "non-cash, no/low risk covered

Transactions between banks and the BSP:

Philippines; Internal operating expenses of the banks: Transactions between banks operating in the

Roll-overs of placements of time deposits; and Loan interest/principal payment debited against Iending bank." Transactions invoiving transfer of funds from one deposit account to another deposit account of the same person within the same bank; borrower's deposit account maintained with the

1 to determine and report to the AMLC the specific transactions falling within the purview of the aforesaid Request the BSP-supervised institutions, through the BSP-identified categories of "non-cash, no/low risk Association of Bank Compliance Officers (ABCOMP)

covered transactions.

to all covered institutions under their respective supervision and reguiation. (ii). Request the Supervising Authorities to disseminate this Resolution

18 March 2009, Manila, Philippines

(Governor. Bangko Sentral nc Pilipinas; Amando M. tetangcO, Jr Chairman

3L. i EDBARIN EDUARDO T MALINIS

(Cnarman. Securities enc Exonarpe Cornasior Conimissioner Insuranoe Commission) Member Membe