Philippine Deposit Insurance
Corporation (PDIC) law
While we put our money in a bank for
deposits. The income of the bank is when
they loan money from to other people,
the interest they put less interest
expenses. If the people do not pay their
interest to the bank, the bank will close.
BSP- control over all the banks in the
Philippines.
PDIC- shall insure the deposits of all the
banks which are entitled to the benefits of
life insurance under this Act, and which
shall have the powers hereinafter
granted.
• Protects the depositing public in
the event of bank foreclosure
• Acts as deposit insurer, as a co-
regulator of banks and as receiver
and liquidator of closed banks.
If the bank will close, your money is
already insured.
Deposit- means the unpaid balance of
money or its equivalent received by a
bank in the usual course of business and
for which it has given or is obliged to give
credit to a commercial, checking,
savings, time or thrift account, evidenced
by a passbook, certificate of deposit, or
other evidence of deposit issued in
accordance with Bangko Sentral ng
Pilipinas rules and regulations and other
applicable laws, together with such other
obligations of a bank, which, consistent
with banking usage and practices, the
Board of Directors shall determine and
prescribe by regulations to be deposit
liabilities of the bank: Provided, That any
obligation of a bank which is payable at
the office of the bank located outside of
the Philippines shall not be a deposit for
any of the purposes of this Act or
included as part of the total deposits or of
insured deposit: Provided, further, That
subject to the approval of the Board of
Directors, any insured bank which is
incorporated under the laws of the
Philippines which maintains a branch
outside the Philippines may elect to
include for insurance its deposit
obligations payable only at such branch.
(As amended by R.A. No. 10846, I1 June
2016)
It’s possible, like OFW’s. there is PNB, it
can be covered by the PDIC law because
it is a branch outside of the country. If
PNB elects to include that for insurance
purposes.
Commercial, checking, time, joint
account these are deposits evidenced by
a passbook or certificate of deposit. Any
form of evidence in accordance to BSP
rules and regulations.
Deposit
The corporation shall not pay for deposit
insurance for the following account
transactions:
1. Investment products such as
bonds and securities, trust
accounts, and other similar
instruments;
• Not under the control of
BSP, these are not
insured.
• When you invest I
something, it does not
 assure you with any
profit. It is a risk.
2. Deposit accounts or transactions
which are fictitious or fraudulent
as determined by the Corporation;
• It’s fictitious because it
was not created in
accordance with the
law. Not created with
the regulation of BSP
3. Deposit accounts or transactions
constituting, and/ or emanating
from, unsafe and unsound
banking practice/s, as determined
by the Corporation, in consultation
with the Bangko Sentral n
Pilipinas, after due notice and
hearing, and publication of a
directive to cease and desist
issued by the Corporation against
such deposit accounts,
transactions or practices; and
4. Deposits that are determined to be
the proceeds of an unlawful
activity as defined under Republic
Act No. 9160, as amended.
• Unlawful activity
“kanang mga nagidnap
tas gedeposit
kwarta sa bank. If
masirado ang bangko
you cannot claim under
PDIC law
Deposit is for purposes of
safekeeping in the sense that you
allow the bank to use your money with
the obligation of the bank to return to
you the money upon demand.
- You are the creditor; the
bank is the debtor.
Scope of deposits
1. Included- these deposits are
insurable deposits
2. Excluded
INSURED DEPOSITS
• The amount due to any bonafide
depositor for legitimate deposits
in an insured bank as of the date
of closure but not to exceed Five
Hundred Thousand Pesos
(P500,099,00).
o Insured up to 500,000. As
the date of closure
o Ang covered kay insurable
deposits (bonafide
depositor for legitimate
deposits and insured
banks under PDIC)
• In determining such amount due
to any depositor, there shall be
added together all deposits in the
bank maintained in the same right
and capacity for his or her benefit
either in his or her own name or
in the name of others
o Example: If Jazzie has a
ang deposit in XYZ bank, and
she has money in several
branches (Davao, Mati,
and Quidapawan) IN each
branch, Jazzie has
500,000 all in all she has
1,500,000 at the time of
closure.
▪ Jazzie is insured up
to 500,000. Even
though she has
500,000 per
branch, PDIC will
only insure per
 bank and not per can deposit up to 500,000.
branch. In case mag close dile
o Dili naba malik ang malugi.
1,000,000?
JOINT ACCOUNT
▪ What will happen
here is that Jazzie Regardless of whether the conjunction
will become a "and", "or, "and/or" is used, shall be
creditor in the insured separately from any individually-
liquidation owned deposit account, provided that:
proceeding of the
bank. If the bank • The and “and” dapat sila duha
closes and mag pirma para maka withdraw
becomes insolvent “or” either sailaha. “and/or” pwede
(kulang og assets sili duha or either sailaha duha
pambayad). If nay What if nag close ang bank. How can
mabilin sa assets we determine the maximum insured
pwede mabalik ang liability?
1M ni Jazzie, pero if
it is not enough 1. If the account is held jointly by two
depende na siya. or more natural persons, or by two
Pero kung kuwang or more juridical persons or
jd ang assets unya entities, the maximum insured
di mabayaran si deposit shall be divided into as
Jazzie then wala na many equal shares as there are
siyay other individuals, juridical persons or
recourse, di na entities, unless a differing sharing
mabalik ang 1M is stipulated in the document of
• In the deposit; and
liquidation a. If it is a joint account owned
process the by A and G, they are
bank will natural persons
lease all the maximum insured
assets and deposit shall be divided
the bank will into as many equal
pay off the shares as there are
liability. individuals. If A and G has
o Example: If there are 500,000 in their joint
banks that you do not account, then it will be
know their standing. First, divided equally and they
and foremost, you must will have 250,000 each.
check if it is under PDIC. i. If G has an account
Second, if their stability is in her own name in
not established then you another branch wala
 paman siya kaabot it among the partners. It s
sa maximum, then considered 1 juridical
pwede pa siya iadd. person. Maximum 500,000.
Covered pa sa PDIC
Whenever an insured bank shall have
ang other account
been closed on account of insolvency,
niya.
payment of the insured deposits in
b. If ABC corporation and
such bank shall be made by the
DEF incorporated has a
Corporation as soon as possible
joint account. 1 corporation
either (1) by cash or (2) by making
1 juridical entity, so you still
available to each depositor a
treat them as separate
transferred deposit in another insured
person. Divided by 2 siya.
bank in an amount equal to the
Pag nag close ang bank
insured deposit of such depositor:
unya naa sila 1,000,000
Provided, That the Corporation, in its
then 500,000 ng makuha
discretion, may require proof of claims to
sa ABC og DEF
be filed before paying the insured
i. If ABC has another
deposit, and that in any case where the
account in another
Corporation is not satisfied as to the
branch, it will not be
validity of a claim for an insured deposit,
covered anymore by
it may require the final determination of a
PDIC, ni exceed na
court of competent jurisdiction before
siya sa limit,
paying such claim.
2. If the account is held by a juridical
person or entity jointly with one or • May mga announcement ang
more natural persons, the PDIC. They usually post It on the
maximum insured deposit shall office. There will also be instances
be presumed to belong entirely na mag post sila where muadto
to such juridcal person or ang mga depositors og when unya
entity. pa fill upon of form.
a. If ABC corporation and A o There would be instances
has a joint account. If na the depositor cannot
500,000 ang laman ng joint show proof saiyahang
account, that whole account. So, PDIC will go
500,000 will pertain to ABC over the bank records. If
corporation, and with that wala sa bank record and
500,000 na abot na niya depositor cannot show
ang maximum. proof of his deposit then
b. If ABC partnership walay basis na mag pay out
(partnership separate and ng insurance proceeds ang
distinct from its partners) If PDIC. You must have
ABC partnership and ABC proof of your claim to be
company has a joint filed before PDIC will pay
account, you do not divide you.
 o If PDIC is not satisfied with the case mentioned in the first proviso or
your claim, then you have by the Corporation together with such
to be included to the other office, body or ageney.
creditors during the (Renumbered from Sec. I4 and amended
liquidation proceedings. by RA. No. 10846, 11 June 2016)
PAYMENT OF INSURED DEPOSITS
SEC. 19. Whenever an insured bank Failure to file the claim within 6 months
shall have been closed by the Monetary due to PDIC’s fault pwede habulin ang
Board pursuant to Section 30 of Republic director, officer, and employee’s of PDIC.
Act No. 7653, or upon expiration or
• Maximum ang 6 months, if nag
revocation of a bank's corporate term,
submit naka ng form nila for claim,
payment of the insured deposits on such
tapos after ng 6 months wala ka
closed bank shall be made by the
pa rin naka tanggap, you really
Corporation as soon as possible either
have a deposit sa bank, pwede
(1) by cash or (2) by making available to
ma liable ang director or officer sa
each depositor a transferred deposit in
PDIC. As long as it is within the
another insured bank in an amount equal
500,000 maximum liability.
to insured deposit of such depositor:
Provided, however, That the
Corporation, in its discretion, may require
proof of claims to be filed before paying
the insured deposits, and that in any case
where the Corporation is not satisfied as
to the validity of a claim for an insured
deposit, it may require final determination
of a court of competent jurisdiction before
paying such claim: Provided, further,
That failure to settle the claim, within
six (6) months from the date of filing
of claim for insured deposit, where
such failure was due to grave abuse of
discretion, gross negligence, bad
faith, or malice, shall, upon
conviction, subject the directors,
officers or employees of the
Corporation responsible for the delay
to imprisonment from six (6) months
to one (1) year: Provided, furthermore,
That the period shall not apply if the
validity of the claim requires the
resolution of issues of facts and or law by
another office, body or agency including
 Bank Secrecy Act- RA 1405
An act prohibiting disclosure of or inquiry
into, deposits with any banking institution
and providing penalty therefor.
Section 1. It is hereby declared to be the policy of
the Government 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.
The purposes of bank secrecy act are two folds
1. Encourage people to deposit money in the
bank so that it could be in circulation
2. Discourage private hoarding
a. Alkansya- discouraged by the BSP
because the purpose of money is for
circulation, the more that it is
circulated, it would be more
advantageous for the government
(because the money is circulating and
there is no need that the BSP to make
coins/bill every now and then)
Section 2. All deposits of whatever nature with
banks or banking institutions in the Philippines
including investments in bonds issued by the
Government of the Philippines, its political
subdivisions and its instrumentalities, are hereby
considered as of an absolutely confidential nature
and may not be examined, inquired or looked into
by any person, government official, bureau or office,
except upon written permission of the depositor, or
in cases of impeachment, or upon order of a
competent court in cases of bribery or dereliction of
duty of public officials, or in cases where the money
deposited or invested is the subject matter of the
litigation.
GN: Bank deposits are absolutely confidential,
meaning, it should not be disclosed.
• No person, whether or not a government
official, can check your account with a bank.
• The bank, its employees or any persons who
have information regarding your bank
deposits should remain such information as
confidential.
Exception:
1. In cases of examination authorized by the
monetary board
o Monetary board is under BSP, BSP
regulates and supervises banks.
Every now and then they will get to
look at the accounts of certain
individuals as part of the procedure
of the examination.
▪ Nonetheless, employees of
BSP should not disclose the
information acquired to other
persons.
2. In cases of examination made by an
independent auditor hired by the bank and
results thereof shall be for the exclusive use
of the bank
o For the exclusive use of the bank. The
independent auditor should not
disclose it to other persons.
3. Written permission of the depositor, or
o If depositor permits to disclose his
account, then it is allowed.
4. In cases of impeachment, or
o Once impeachment case proceeds,
bank deposits will not be anymore
confidential.
5. Upon order of a competent court in cases of
bribery or dereliction of duty of public
officials, or
6. In cases where the money deposited or
invested is the subject matter of the
litigation
o There is a pending case, so the court
can order for the disclosure of
information regarding bank deposit.
7. In cases of violation of the Anti-money
Laundering Act, the Anti-money Laundering
Council may inquire into a bank account
upon order of any competent court.
These are instances where bank deposits can be
disclosed and not considered as completely
confidential.
Section 3. It shall be unlawful for any official or
employee of a banking institution to disclose to any
person other than those mentioned in Section two
hereof any information concerning said deposits.
Unlawful- if you violate this provision, there is
penalty provided under SEC 5.
Section 5. Any violation of this law will subject
offender upon conviction, to an imprisonment of
not more than five years or a fine of not more than
twenty thousand pesos or both, in the discretion of
the court.
Truth in Lending Act- RA 3765
Section 2. Declaration of Policy.
It is hereby declared to be the policy of the State 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.
Truth in lending act applicable:
1. One borrows money (debtor borrows money
from the creditor)
a. So, there may charges that will be
included aside from the principal
obligation.
b. Under the Truth in Lending Act, it
requires the creditor to disclose what
are the fees and cost that are
included in connection to that credit.
Section 3. Credit
"Credit" means any loan, mortgage, deed of trust,
advance, or discount; any conditional sales contract;
any contract to sell, or sale or contract of sale of
property or services, either for present or future
delivery, under which part or all of the price is
payable subsequent to the making of such sale or
contract; any rental-purchase contract; any contract
or arrangement for the hire, bailment, or leasing of
property; any option, demand, lien, pledge, or other
claim against, or for the delivery of, property or
money; any purchase, or other acquisition of, or any
credit upon the security of, any obligation of claim
arising out of any of the foregoing; and any
transaction or series of transactions having a similar
purpose or effect.
Finance Charge
"Finance charge" includes interest, fees, service
charges, discounts, and such other charges incident
to the extension of credit as the Board may be
regulation prescribe.
Under Truth in lending act, we have this term
financial charge which covers the interest, fees, and
other cost.
• Must be in connection to a contract of loan,
lease, sale
Board
"Board" means the Monetary Board of the Central
Bank of the Philippines.
Creditor
The law covers any creditor, which is defined as any
person engaged in the business of extending credit
(including any person who as a regular business
practice make loans or sells or rents property or
services on a time, credit, or installment basis, either
as principal or as agent) who requires as an incident
to the extension of credit, the payment of a finance
charge.
Example:
A borrowed money, so, the charges to be included
must be disclosed by the creditor. That is what is
required under the Truth in Lending Act.
Section 4. Any creditor shall furnish to each person
to whom credit is extended, prior to the
consummation of the transaction, 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 price 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) the difference between the amounts set forth
under 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; principal
(6) the finance charge expressed in terms of pesos
and centavos; and (you could impose interest
rate, this could include penalty charge, service
fees, and other cost)
(7) the percentage that the finance bears to the total
amount to be financed expressed as a simple
annual rate on the outstanding unpaid balance of
the obligation.
Things to be disclosed by the creditor if he will lend
money and if there are additional fees or charges
aside from the payment of the principal obligation.
Things not included under SEC 4:
1. Fees to be paid in favor of a lawyer (lawyer
consultation- not required under Truth in
Lending Act to be disclosed)
2. Fees to be charged because of the
notarization of the contract
3. Other fees:
a. Travel expenses
b. Photocopying expenses
c. Expenses that would be paid in favor
of other government offices.
The information (charges) enumerated above must
be disclosed to the debtor or borrower prior to the
consummation of the transaction. And that it must
be clearly stated in writing.
• Borrower can demand it from the creditor
because later on, the creditor cannot say
that you have additional interest, charges,
without agreement.
o Or if you both have an agreement but
not expressly stipulated in writing,
you have to consider whether or not
we apply this Truth in Lending Act.
o Agreement but not in writing-
violation of the Truth in Lending Act.
Consequences of Non-Compliance
1. The contract or transaction remains valid or
enforceable
a. If you borrowed 500,000 and the
penalty charges are not disclosed, it
will not affect the principal contract.
b. However, the creditor will be liable
for penalties for violation of the
Truth in Lending Act.
2. Penalties:
a. Any creditor who violates the law is
liable in the amount of P100 or in an
amount equal to twice the finance
charged required by such creditor in
connection with such transaction,
whichever is the 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.
b. Creditor is also liable for reasonable
attorney’s fees and court costs as
determined by the court.
c. Any person who willfully violates any
provisions of this law or any
regulation issued thereunder shall be
fined by not less than P1,00 or more
than P5,000 or imprisonment for not
less than 6 months, nor more than
one year or both.
d. However, no punishment or penalty
provided by this Act shall apply to the
Philippine Government or any
agency or any political subdivision
thereof.
Non-compliance does not affect the contract of loan
but the creditor who violates may be liable for a fine
and there is a possibility of imprisonment of not less
than 6 months nor more than one year or both.
ANTI-MONEY LAUDERING ACT
Policy of the state
• Sintegrity and confidentiality of
bank accounts
• To ensure that the Philippines
shall not be used as a money
laundering site for the proceeds of
any unlawful activity
MONEY LAUNDERING
Is committed by any person who,
knowing that any monetary
instrument or property represents,
involves, or relates to the proceeds of
any unlawful activity:
a) transacts said monetary
instrument or property;
b) converts, transfers, disposes
of, moves, acquires,
possesses or uses said
monetary instrument or
property;
c) conceals or disguises the true
nature, source, location,
disposition, movement or
ownership of or rights with
respect to said monetary
instrument or property;
d) attempts or conspires to
commit money laundering
offenses referred to in
paragraphs (a), (b) or (c);
e) aids, abets, assists in or
counsels the commission of
the money laundering offenses
referred to in paragraphs (a),
(b) or (c) above; and in
f) performs or fails to perform
any act as a resutt of which he
facilitates the offense of
money laundering referred to
in paragraphs (a), (b) or (c)
above.
Money laundering is also
committed by any covered person who,
knowing that a covered or suspicious
transaction is required under this Act to
be reported to the Anti-Money
Laundering Council (AMLC), fails to do
so."
Unlawful activities
refers to any act or omission or series or
combination thereof involving or having
direct relation to the following:
1. Kidnapping for ransom
2. Violation of the Comprehensive
Dangerous Drugs Act of 2002
3. Violation of the Anti-Graft and Corrupt
Practices Act
4. Plunder under Republic Act No. 7080
5. Robbery and extortion
6. Jueteng and Masiao punished as
illegal gambling
7. Piracy on the high seas
8. Qualified theft
9. Swindling
10. Smuggling
11. Violations of Republic Act No. 8792,
otherwise known as the Electronic
Commerce Act of 2000;
12. Hijacking; destructive arson and
murder;
13. Terrorism and conspiracy to commit;
14. Financing of terrorism;
15. Bribery;
16. Frauds and Illegal Exactions;
17. Malversation of Public Funds and
Property;
18. Forgeries and Counterfeiting;
19. Violations of Sections 4 to 6 of
Republic Act No. 9208, otherwise
 known as the Anti-Trafficking in
Persons Act of 2003;
20. Violations of the Revised Forestry
Code of the Philippines;
21. Violations of Fisheries Code of 1998;
22. Violations of the Philippine Mining
Act of 1995;
23. Violations of the Wildlife Resources
Conservation and Protection Act;
24. Violation of the National Caves and
Cave Resources Management
Protection Act;
25. Violation of the Anti-Carnapping Act
of 2002, as amended;
26. Violations of the Laws on
Illegal/Unlawful Possession,
Manufacture, Dealing In, Acquisition
or Disposition of Firearms,
Ammunition or Explosives;
27. Violation of the Anti-Fencing Law;
28. Violation of the Migrant Workers and
Overseas Filipinos Act of 1995, as
amended by Republic Act No. 10022;
29. Violation of the Intellectual Property
Code of the Philippines;
30. Violation of the Anti-Photo and Video
Voyeurism Act of 2009;
31. Violation of the Anti-Child
Pornography Act of 2009;
32. Violations of the Special Protection of
Children Against Abuse, Exploitation
and Discrimination;
33. Fraudulent practices and other
violations under Republic Act No.
8799, otherwise known as the
Securities Regulation Code of 2000;
and
34. Felonies or offenses of a similar
nature that are punishable under the
penal laws of other countries.
If the money was sourced from these
unlawful activities, then it is possible that
is covered y AMLA and it will be claimed
and will be made appear from a lawful
source.
Example: Nag kidnap ka tapos ipasok
mo sa bank yung pera. Yung pera
palabasin na galling sa legal na source,
this is essentially called Money
laundering
Covered persons
1) Banks, non-banks, quasi-banks,
trust entities, foreign exchange
dealers, pawnshops, money
changers, remittance and transfer
companies and other similar
entities and all other persons and
their subsidiaries and affiliates
supervised or regulated by the
BSP
2) Insurance companies, preneed
companies and all other persons
supervised or regulated by the
Insurance Companies
3) (i) securities dealers, brokers,
salesmen, investment houses,
and other similar pesons
managing securities or rendering
services as investment agent,
advisor, or consultat
(ii) mutual funds, close-end
investment companies, common
trust funds, and other similar
persons
(iii) other entities administering or
otherwise dealing in currency,
commodities or financial
derivatives based thereon,
valuable objects, cash substitutes
and other similar monetary
instruments or property
supervised or regulated by the
SEC
4) jewelry dealers in precious
metals, who, as a business, trade
in precious metals, for
 transactions in excess of One
million pesos (P1,000,000.00);
5) jewelry dealers in precious
stones, who, as a business, trade
in precious stones, for
transactions in excess of One
million pesos (P1,000,000.00);
6) Company service providers
which, as a business, provide any
of the following services to third
parties: (i) acting as a formation
agent of juridical persons; (ii)
acting as (or arranging for another
person to act as) a director or
corporate secretary of a company,
a partner of a partnership, or a
similar position in relation to other
juridical persons; (iii) providing a
registered office, business
address or accommodation,
correspondence or administrative
address for a company, a
partnership or any other legal
person or arrangement; and (iv)
acting as (or arranging for another
person to act as) a nominee
shareholder for another person;
and
7) persons who provide any of the
following services:
(i) managing of client money,
securities or other assets;
(ii) management of bank, savings
or securities accounts;
(iii) organization of contributions
for the creation, operation or
management of companies; and
(iv) creation, operation or
management of juridical persons
or arrangements, and buying and
selling business entities.
8) Casinos, including interest and
ship-based casinos, with respect
to their casino cash transaction
related to their gaming operations.
Covered person have the
responsibility and obligation under
the AMLA. They have to report to
AMLC the covered transactions or
suspicious transactions
Excluded: lawyers and accountants
acting as independent legal
professionals in relation to
information concerning their clients or
where disclosure of information would
compromise client confidences or the
attorney-client relationship:
Provided, that these lawyers and
accountants are authorized to
practice in the Philippines and shall
continue to be subject to the
provisions of their respective codes of
conduct and/or professional
responsibility or any of its
amendments
• If you are a lawyer and an
accountant dealing with the
accounts of your clients 500,000
and above because that is the
amount would cover ng AMLA
you are not required to disclose
such transaction to the AMLA of
the atty client relationship.
Covered transactions
• Any transaction in cash or other
equivalent monetary instrument
involving a total amount in excess
of 500,000 within one banking
day.
 o Nay gedeposit na kwarta
more than 500,000 in one
day should be reported.
• jewelry dealers in precious
stones, who, as a business, trade
in precious stones, for
transactions in excess of One
million pesos
• the Land Registration Authority
and all its Registries of Deeds to
submit to the AMLC, reports on all
real estate transactions involving
an amount in excess of Five
hundred thousand pesos
(P500,000.00) within fifteen (15)
days from the date of registration
of the transaction
• a single casino transaction
involving an amount in excess of
5,000,000 or its equivalent in any
other currency.
If any of these happens, the covered
persons must report it to the AMLC
(ANTI-MONEY LAUNDERING
COUNCIL) otherwise, they would be held
liable.
• Regardless sa nature ng
transaction, automatically
covered siya in the amount
involved.
Suspicious transactions
These are transactions with
covered institutions, regardless of the
amounts involved, where any of the
following circumstances exist:
1. There is no underlying legal or
trade obligation, purpose or
economic justification
2. The client is not properly identified
3. The amount involved is not
commensurate with the business
or financial capacity of the client
a. Example: depositor sa
bank nakalagay na
occupation is janitor pero
ang iyahang kwarta kay
400,000 or everyday nay
nagasulod saiya bank
account na 10,000. Nay
nagasulod every Friday na
200,000. Miskag wala nag
excess sa 500,000
suspicious siya kay wala
siya nag commensurate
saiyaha financial capacity.
4. Taking into account a;; known
circumstances, it may be
perceived that the client’s
transaction is structured in order
to avoid being subject of reporting
requirements under the acts
a. Covered transaction is
depositing 500,000 in one
banking day. So ang
imohang himuon kay
iseparate nimo ang
100,000 in 5 days. Wala ka
abo tog 500,000 pero pag
mapansin mo na 6 days na
sunod sunod na withdraw
of 100,000. Pwede siya
iflag kay they are trying to
avoid to being considered
of covered transactions.
5. Any circumstances, relating to the
transaction which is observed to
deviate from the profile of the
client and/or the client’s past
transactions with the covered
institution
6. The transaction are in a way
related to an unlawful activity or
offense under this Act that is about
to be, is being or has been
committed; or
 7. Any transactions that is similar or
analogous to any of the foregoing.
Regardless of the amount involved.
Enough na magsuspect ka sa
transactions involved.
Politically Exposed Persons
• Refers to an individual who is or
has been entrusted with
prominent public position in (a) the
Philippines with substantial
authority over policy, operating
actions or the use or allocation of
government-owned resources; (b)
a foreign state; or (c) an
international organization
The term PEP shall include immediate
family members, and close relationships
and associates that are reputedly know
to have:
1. Joint beneficial ownership of a
legal entity or legal arrangement
with the main/principal PEP
2. Sole beneficial ownership of a
legal entity or legal arrangement
that is known to exist for the
benefit of the main/principal PEP
Beneficial owner
Refers to any natural person who:
1. Ultimately owns or controls the
customer and/or on whose behalf
a transaction or activity is being
conducted; or
2. Has ultimate effective control over
a legal person or arrangement.
• It may be a corporation, but it is
only operated by one person.
Concept of money laundering
Cash derived from crime or terrorism,
you have money and dispose of it from
another person and that person will put it
in the bank, using fake documents. Then
the bank transfer the amount on offshore
accounts from that offshore account
withdrawals can be made and then be
used to buy off illegal firearms, paikot ikot
lang ang pera pero ginagamit siya for
unlawful activities. Palabasin na from
lawful acts.
Money laundering- from the word
“laundry” you clean something that is
dirty. Money is dirty because it came from
a unlawful source. Some laundry will be
done using fake documents, to later on
show that it is clean.
Covered persons shall report to the
AMLC all covered transactions and
suspicious transactions within 5
working days from occurrence
thereof, unless the AMLC prescribes a
different period not exceeding 15
working days.
If ever you will have a transaction that is
a covered transaction because more
than 500,000 as long it is in good faith
and comes from a lawful source then no
need to be afraid. Kasi ang una lang
naman na ginagawa is reporting to the
AMLC. The ALMC will then make the
necessary investigation if it is lawful or
hindi.
• If nabenta property niyo for
2 million, gedeposit ang
cheque sa bank mo. Do not
be scared na ireport sa
bank kay pwede man
iexplain how did you get
that money.
ANTI-MONEY LAUNDERING COUNCIL
• To require and receive
covered transaction
reports from the covered
institutions
• To issue orders to the
appropriate supervising
authority or the covered
institution to to determine
the true identity of the
owner of any monetary
instrument or property
subject of a covered
transaction or request for
assistance drom a foreign
state, or believed by the
Council, on the basis of
substantial vedidence, to
be, in whole or in part,
wherever located,
representing, involving, or
related to, directly or
indirectly. In any manner or
by any means, the
proceeds of an unlawful
activity;
• To institute civil forfeiture
proceedings and all other
remedial proceedings
through the Office of the
Solicitor General
• To cause the filing of
complaints with the
department of justice or the
ombudsman for the
prosecution of money
laundering offenses
• To initiate investigation of
covered transactions,
money laundering activities
and other violation of this
Act
• To apply before the Court
of Appeals, ex parte, for the
freezing of any monetary
instrument or property
alleged to be laundered,
proceeds from, or
instrumentalities used in or
intended for use in any
unlawful activity
• To implement measures as
may be necessary and
justified under this Act to
counteract money
laundering
• To receive and take action
in respect of, any request
from foreign states for
assistance in their own
anti-money laundering
operations provided in this
act;
• to develop educational
programs on the pernicious
effects of money
laundering, the methods
and techniques used in
money laundering, the
viable means of preventing
money laundering and the
effective ways of
prosecuting and punishing
offenders; and
• to enlist the assistance of
any branch, department,
bureau, office, agency or
instrumentality of the
government, including
government-owned and -
controlled corporations, in
undertaking any and all
anti-money laundering
operations, which may
include the use of its
personnel, facilities and
resources for the more
resolute prevention,
detection and investigation
of money laundering
 offenses and prosecution
of offenders.
• to require the Land
Registration Authority and
all its Registries of Needs
to submit to the AML,
reports on all real estate
transactions involving an
amount in excess of Five
hundred thousand pesos
(P500,000.00) within
fifteen (15) days from the
date of registration of the
transaction, in a form to be
prescribed by the AMLC.
The AMLC may also
require the Land
Registration Authority and
all its Registries of Deeds
to submit copies of relevant
documents
Section 11. Authority to Inquire into Bank
Deposits, Notwithstanding the provisions
of Republic Act No. 1405, as amended;
Republic Act No. 6426, as amended;
Republic Act No. 8791, and other laws,
the AML may inquire into or examine any
particular deposit or investment with any
banking institution or nonbank financial
institution upon order of any competent
court in cases af violation of this Act
when it has been established that there
is probable cause that the deposits or
investments are related to an unlawful
activity as defined in Section 3 (i) hereof
or a money laundering offense under
Section 4 hereof, except that no court
order shall be required in cases involving
unlawful activities defined in Sections
3(1) 1, (2), and (12).
General rule: if deposit Is from these
unlawful activities and the ALMC has
sufficient proof to give rise to a probable
cause pwede tingnan ng AMLC ang
account but needs a court order.
Exception: 3 instances where there is no
need for court order for AMLC to look in
the account: Kidnapping for ransom,
violation of the comprehensive
dangerous acts, and hijacking;
destructive arson and murder.
Customer due diligence -Covered
persons shall establish and record the
true identity of their clients based on
official documents. They shall maintain a
system of verifying the true identity of
their clients based on reliable,
independent source, documents, data, or
information. In case of corporate clients,
covered persons are required to maintain
a system of verifying their legal existence
and organizational structure, as well as
the authority and identification of all
persons purporting to act on their behalf.
Covered persons shall establish
appropriate systems and methods, and
adequate internal controls, Compliant
with the AMLA, this RIRR, other AMLC
issuances, the guidelines issued by the
Supervising Authorities, and
internationally accepted anti-money
laundering standards, for verifying and
recording the true and full identity of their
customers.
• Covered person must exercise
this due diligence to identify the
identity of their customer.
a) Customer identification
a. Face-to-face contact- need
personal
b. Minimum customer
information and identification
documents
 c. Third-party reliance- to
determine the status of the
customer
d. Outsourcing the Conduct of
Customer dentification- credit
investigation procedure
e. Identification and verification
of a Beneficial Owner, trustee,
nominee or agent
Kinds of due diligence
a. Reduced Due Diligence - Where
lower risks of money laundering
and terrorist financing have been
identified, through an adequate
analysis of risk by the covered
persons, reduced due diligence
procedures may be applied. The
reduced due diligence procedures
should be commensurate with the
lower risk factors, but are not
acceptable whenever there is
suspicion of money laundering
o Unlikely for the client to for
this client to engage in
unlawful activities. Due
diligence required is lesser
pero need parin mag
exercise ang covered
persons
b. Enhanced Due Diligence. -
Covered persons shall examine
the background and purpose of all
complex, unusually large
transactions, all unusual patterns
of transactions, which have no
apparent economic or lawful
purpose, and other transactions
that may be considered
suspicious.
o Mas taas na diligence ang
required under this
circumstances.
Prohibited accounts
The following accounts shall be
prohibited and may be the subject of the
Supervising Authorities' annual testing
for the sole purpose of determining the
existence and true identity of their
owners:
(a) Anonymous Accounts and
Accounts under Fictitious Names.
- Covered persons shall maintain
customers' ' account only in the
true and full name of the account
owner or holder. Anonymous
accounts, accounts under
fictitious names, and all other
similar accounts shall be
absolutely prohibited.
(b) Numbered Accounts. - Numbered
accounts, except non checking
numbered shall not be allowed.
i. Cannot use
numbered account
only
Covered and suspicious transaction
reports involving non-checking
numbered accounts shall contain the true
name of the account holder.
Record keeping
Covered persons shall maintain and
safely store for five (5) years from the
dates of transactions all records of
customer identification and transaction
documents.
1. Retention of Records Where the
Account is the Subject of a Case.
- If a case has been filed in court
 involving the account, records transaction or
must be retained and safely kept suspicious
beyond the five (5)-year period, transaction. That’s
until it is officially confirmed by the part of your regular
AML Secretariat that the case has performance, you are
been resolved, decided or safe from any
terminated with finality proceeding. As long
2. Closed Accounts Covered as what you did, you r
persons shall maintain and safely duty and it is in good
store for at least five (5) years faith. Whether or not
from the dates the accounts were your reporting will
closed, all records of customer result to criminal
identification and transaction prosecution. Ikaw
documents, mismo will be saf from
3. Form of Records Covered any proceeding case
persons shall retain all records as filed against you,
originals or in such forms as are because you are only
admissible in court. doing the
performance of your
Covered persons shall, likewise, keep duty s required by law
the electronic copies of all covered and and you are in good
suspicious transaction reports for, at faith.
least, five (5) years from the dates of
submissions to the AMLC ASSET FORFEITURE

For low risk customers, it is Civil Forfeiture - Upon determination

sufficient that covered persons shall
maintain and store, in whatever form, a
record of customer information and
transactions.
Safe harbor provision
No administrative, criminal or civil
proceedings shall lie against any person
for having made a covered transaction
suspicious transaction report 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.
- If you are working in a
bank, you will be
making the report of
the covered
that probable cause exists that any
monetary instrument or property is in any
way related to an unlawful activity or a
money laundering offense, the AMLC
shall file with the regional trial court,
through the office of the solicitor general,
a verified petition for civil forfeiture.
1, equal value assets- the petition for civil
forfeiture shall include other monetary
instrument or property for equal value in
cases where the monetary instrument or
property that should be subject of
forfeiture:
A. Cannot be located despite due
diligence
B. Has been substantially altered,
destroyed, diminished in value or
 otherwise rendered worthless by
any act or omissions
C. Has been concealed, removed,
converted, or otherwise
transferred;
D. Is located outside the Philippines
or has been placed or brought
outside the jurisdiction of the court
E. Has been commingled with other
monetary instrument or property
belonging to either the offender
himself or a third person or entity,
thereby rendering the same
difficult to identify or be
segregated for purposes of
forfeiture.

Pwede habulin ang other assets of the

person committing unlawful activities or
many laundering offense. Kasi ang
mismong money na gelaunder nya
cannot be located anymore or has
already been deposited in another bank
outside of the Philippines.

Forfeiture of asset in favor of the gov’t

Asset forfeiture in money laundering

cases- where there is conviction for
money laundering, the court shall issue a
judgement of forfeiture in favor of the
Government of the Philippines with
respect to the monetary instrument or
property found to be proceeds of an
unlawful activity.

- Covers, forfeiture of
the subject matter
itself requiring
conviction.