ANTI-MONEY LAUNDERING LAW

Republic Act No. 9160, as amended

September 2020
 RATIONALE FOR ENACTING THE LAW

The Philippines, while striving to sustain economic

development and poverty alleviation through, among others,
corporate governance and public office transparency, must
contribute its share and play a vital role in the global fight
against money laundering.

Hence, the compelling need to enact responsive anti-money

laundering legislation in order to establish and strengthen an
anti-money laundering regime in the country which will not
only increase investor’s confidence but also ensure that the
Philippines is not used as a site to launder proceeds of
unlawful activities.
 SALIENT FEATURES OF THE LAW

1. Criminalizes money laundering

2. Creates a financial intelligence unit
3. Imposes requirements on customer identification,
record keeping and reporting of covered and
suspicious transactions
4. Relaxes strict bank deposits secrecy laws
5. Provides for bank inquiry and freeze ex parte
petition/seizure/forfeiture/recovery of dirty
money/property
6. Provides for international cooperation
 
 COVERED PERSONS UNDER AMLA

•  Banks,  offshore banking units, quasi-banks, trust entities,

non-stock savings and loan associations, pawnshops, foreign
exchange dealers, money changers, money remittance or
transfer companies, electronic money issuers and all other
persons and entities supervised or regulated by the BSP,
including their subsidiaries and affiliates

•   Insurance companies, insurance agents, insurance brokers,

professional reinsurers, reinsurance brokers, holding company
systems, pre-need companies, mutual   benefit associations
and all other persons and entities supervised and regulated by
the Insurance Commission (IC).
 COVERED PERSONS UNDER AMLA
•  The following Covered Persons under the supervision and
regulation of the Securities and Exchange Commission
(SEC):

Jewelry dealers in precious metals, who, as a business,

trade in precious metals; (n)

Jewelry dealers in precious stones, who, as a business,

trade in precious stones; (n)

•  Casinos,including internet and ship-based casinos, with

respect to their gaming operations. Casinos are businesses
“authorized by the appropriate government agency to engage
in gaming operations.
 COVERED PERSONS UNDER AMLA
• Company service providers which, as a business, provide
any of the following services to third parties:

a)   acting as a formation agent of juridical persons;

b)  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;
c)  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
d)    acting as (or arranging for another person to act as)
a nominee shareholder for another person.  (n)
 COVERED PERSONS UNDER AMLA
• Persons who provide any of the following services
other than those supervised and regulated by the BSP,
SEC and IC:

a)   Managing of client money, securities or other

assets;
b)   Management of bank, savings or securities
accounts;
c) Organization of contributions for the creation,
operation or management of companies; and
d)   Creation, operation or management of juridical
persons or arrangements, and buying and selling
business entities.
 PERSONS NOT COVERED UNDER AMLA

“Covered Persons” shall exclude 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. (n)

“Independent legal professional” are lawyers and accountants

working in a private firm or sole practitioner who by way of
business provides purely legal or notarial services to their clients.
 OFFENSES AND PENALTIES
1. Knowingly transacting or attempting to transact any monetary
instrument/property which represents, involves or relates to the
proceeds of an unlawful activity. Penalty is 7 to 14 years
imprisonment and a fine of not less than P3M but not more than
twice the value of the monetary instrument/property. 

2. Knowingly performing or failing to perform an act in relation to any

monetary instrument/property involving the proceeds of any
unlawful activity as a result of which he facilitated the offense of
money laundering. Penalty is 4 to 7 years imprisonment and a fine
of not less than P1.5M but not more than P3M. 

3. Knowingly failing to disclose and file with the AMLC any monetary
instrument/property required to be disclosed and filed. Penalty is 6
months to 4 years imprisonment or a fine of not less than P100,000
but not more than P500,000, or both.
 WHAT IS AN UNALWFUL ACTIVITY?

Unlawful Activity is the offense which generates dirty

money or property. It is commonly called the predicate crime.
It refers to any act or omission or series or combination
thereof involving or having direct relation to the following:

Predicate Crimes/Unlawful Activities

   
• Kidnapping for ransom
• Drug trafficking and related offenses
• Graft and corrupt practices  
• Plunder    
• Robbery and Extortion
• Jueteng and Masiao
• Piracy
 WHAT IS AN UNALWFUL ACTIVITY?

• Qualified theft
• Swindling
• Smuggling
• Violations under the Electronic Commerce Act of 2000
• Hijacking; destructive arson; and murder, including
those perpetrated by terrorists against non-combatant
persons and similar targets
• Fraudulent practices and other violations under the
Securities Regulation Code of 2000
• Felonies or offenses of a similar nature that are
punishable under the penal laws of other countries.
WHAT IS AN UNALWFUL ACTIVITY?

• Terrorism financing and organizing or directing

others to commit terrorism financing (R.A. 10168).
• Attempt/conspiracy to commit terrorism financing
and organizing or directing others to commit
terrorism financing (R.A. 10168).
• Attempt/conspiracy to commit dealing with property
or funds of designated person.
• Accomplice to terrorism financing or conspiracy to
commit terrorism financing.
• Accessory to terrorism financing.
 OTHER OFFENSES AND PENALTIES

Failure to keep records is committed by any responsible

official or employee of a covered institution who fails to
maintain and safely store all records of all transactions of
said institution, including closed accounts, for five (5)
years from the date of the transaction/closure of the
account.

Penalty is 6 months to 1 year imprisonment or a fine of

not less than P100,000 but not more than P500,000, or
both.
 OTHER OFFENSES AND PENALTIES

Malicious reporting is committed by any person who, with

malice or in bad faith, reports/files a completely
unwarranted or false information relative to money
laundering transaction against any person.

Penalty is 6 months to 4 years imprisonment and a fine of

not less than P100,000 but not more than P500,000, at
the discretion of the court. The offender is not entitled to
avail the benefits of the Probation Law.
• 
 OTHER OFFENSES AND PENALTIES
• Ifthe offender is a corporation, association, partnership or
any juridical person, the penalty shall be imposed upon the
responsible officers, as the case may be, who participated in,
or allowed by their gross negligence, the commission of the
crime.
• If the offender is a juridical person, the court may suspend
or revoke its license.
• If the offender is an alien, he shall, in addition to the
penalties prescribed, be deported without further proceedings
after serving the penalties prescribed.
• If the offender is a public official or employee, he shall, in
addition to the penalties prescribed, suffer perpetual or
temporary absolute disqualification from office, as the case
may be.
 OTHER OFFENSES AND PENALTIES

Breach of confidentiality. When reporting covered or suspicious

transactions to the AMLC, covered institutions and their
officers/employees are prohibited from communicating directly
or indirectly, in any manner or by any means, to any
person/entity/media, the fact that such report was made, the
contents thereof, or any other information in relation thereto.
In case of violation thereof, the concerned official and
employee of the covered institution shall be criminally liable.
 OTHER OFFENSES AND PENALTIES

Neither may such reporting be published or aired in any

manner or form by the mass media, electronic mail or other
similar devices. In case of a breach of confidentiality
published or reported by media, the responsible reporter,
writer, president, publisher, manager and editor-in-chief shall
also be held criminally liable.

Penalty is 3 to 8 years imprisonment and a fine of not less

than P500,000 but not more than P1M.
 COVERED INSTITUTIONS

Covered Institutions are those mandated by the

AMLA to submit covered and suspicious transaction
reports to the AMLC.These are:

1. Banks and all other entities, including their

subsidiaries and affiliates, supervised and regulated
by the Bangko Sentral ng Pilipinas
2. Insurance companies, pre-need companies and all
other institutions supervised or regulated by the
Insurance Commission
3. Securities dealers and other entities supervised or
regulated by the Securities and Exchange
Commission
COVERED AND SUSPICIOUS TRANSACTIONS

Covered transactions are single transactions in cash or

other equivalent monetary instrument involving a total
amount in excess of Five Hundred Thousand (P500,000)
Pesos within one (1) banking day
Suspicious transactions are transactions with covered
institutions, regardless of the amounts involved, where
any of the following circumstances exists: 

• there is no underlying legal/trade obligation, purpose or

economic justification; the client is not properly identified;
COVERED AND SUSPICIOUS TRANSACTIONS

• the amount involved is not commensurate with the

business or financial capacity of the client;

• the transaction is structured to avoid being the subject

of reporting requirements under the AMLA;

• there is a deviation from the client’s profile/past

transactions;

• the transaction is related to an unlawful activity/offense

under the AMLA;

• and transactions similar or analogous to the above.

 FREEZING OF MONETARY
INSTRUMENT OR PROPERTY
The AMLC may file before Court of Appeals, before the
verified application ex parte (without notice to the other
party) after determination that probable cause exists that any
monetary instrument or property is in any way related to an
unlawful activity.

The freeze order shall be effective immediately. The freeze

order shall be for a period of 20 days unless extended by the
court.
 AUTHORITY TO INQUIRE
INTO BANK DEPOSITS

The AMLC may inquire into or examine any particular

deposit or investment with any banking institution or
non-bank financial institution upon order of any
competent court in cases of violation of the AMLA when
it has been established that there is probable cause that
the deposits or investments involved are in any way
related to a money laundering offense.