Amendments to the Anti-Money Laundering Act

Amendments to the Anti-Money Laundering Act

• Republic Act No. 11521

– An act further strengthening R.A. 9160 or the Anti-Money

Laundering Act of 2001

– took effect on February 8, 2021

Amendments to the Anti-Money Laundering Act

Money Laundering - Money laundering is a crime whereby the proceeds of an unlawful

activity as herein defined are transacted, thereby making them appear to have originated from
legitimate sources. It is committed by the following:

a.Any person knowing that any monetary instrument or property represents, involves,
or relates to, the proceeds of any unlawful activity, transacts or attempts to transact said
monetary instrument or property.

b.Any person knowing that any monetary instrument or property involves the proceeds
of any unlawful activity, performs or fails to perform any act as a result of which he
facilitates the offense of money laundering referred to in paragraph (a) above.

c.Any person knowing that any monetary instrument or property is required under this
Act to be disclosed and filed with the Anti-Money Laundering Council (AMLC), fails to do
so.
Amendments to the Anti-Money Laundering Act
• Highlights of Republic Act No. 11521

1. Added two new covered persons

2. Added a new kind of covered transaction
3. Added two new unlawful activities
4. Granted the Anti-Money Laundering Council (AMLC) the
power to issue an ex parte freeze order
Amendments to the Anti-Money Laundering Act
• Additional covered persons

– Covered persons shall report to the AMLC all covered transactions and
suspicious transactions.

– Covered persons shall, comply with all the requirements under the AMLA and
TFPSA, their respective IRR, and other AMLC issuances. They shall have the
duty to cooperate with the AMLC in the, discharge of the latter’s mandate, and
execution of its lawful orders and issuances, to protect their businesses or
professions from being used in ML/TF activities.
 Amendments to the Anti-Money Laundering Act
• Additional covered persons

• A covered transaction refers to:

1. A transaction in cash or other equivalent monetary instrument exceeding Five
Hundred Thousand pesos (PHP500,000.00).
2. A transaction with or involving jewelry dealers, dealers in precious metals and
dealers in precious stones in cash or other equivalent monetary instrument
exceeding One Million pesos (Php1,000,000.00).
3. A casino cash transaction exceeding Five Million Pesos (PHP5,000,000.00)
or its equivalent in other currency.
4. A cash transaction with or involving real estate developers or brokers
exceeding Seven Million Five Hundred Thousand Pesos (P7,500,000.00) or
its equivalent in any other currency.
Amendments to the Anti-Money Laundering Act
• Additional covered persons

• A suspicious transaction refers to a transaction, regardless of amount,

where any of the suspicious circumstances, as herein defined, is
determined, based on suspicion or, if available, reasonable grounds, to be
existing. (Rule 2, Section 1 (zzzz) 2018 AMLA IRR)
Amendments to the Anti-Money Laundering Act
• Additional covered persons

• “Suspicious Circumstance” refers to any of the following circumstances, the

existence of which makes a transaction suspicious:
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;
4. taking into account all known circumstances, it may be perceived that the
client’s transaction is structured in order to avoid being the subject of reporting
requirements under the AMLA;
Amendments to the Anti-Money Laundering Act
• Additional covered persons

• “Suspicious Circumstance” refers to any of the following circumstances, the

existence of which makes a transaction suspicious:
5. any circumstance 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
person;
6. the transaction is in any way related to ML/TF or related unlawful activity that is
about to be committed, is being or has been committed; or
7. any transaction that is similar, analogous or identical to any of the
foregoing,such as the relevant transactions in related and materially-linked
accounts, as herein defined.
Amendments to the Anti-Money Laundering Act
• Additional covered persons

1. Real Estate Developers and Real Estate Brokers

• Real Estate Developer - Any natural or juridical person engaged in the business of
developing real estate development project for the account of the developer and
offering them for sale or lease. (Sec. 3 (m), RA 11521)
• Real Estate Broker - A duly registered and licensed natural person who, for a
professional fee, commission or other valuable consideration, acts as an agent of a
party in a real estate transaction to offer, advertise, solicit, list, promote, mediate,
negotiate or effect the meeting of the minds on the sale, purchase, exchange,
mortgage, lease or joint venture, or other similar transactions on real estate or any
interest therein. (Sec. 3 (n), RA 11521)
Amendments to the Anti-Money Laundering Act
• Additional covered persons

2. Offshore Gaming Operators, as well as their service providers

• Offshore Gaming Operator - An entity engaged in offering online

games of chance or sporting events via the internet using a network
and software program, by themselves or through local service
providers. (Sec. 3 (l) (4), RA 11521)
Amendments to the Anti-Money Laundering Act
• Additional covered persons

2. Offshore Gaming Operators, as well as their service providers

• Offshore Gaming Operator - An entity engaged in offering online

games of chance or sporting events via the internet using a network
and software program, by themselves or through local service
providers. (Sec. 3 (l) (4), RA 11521)
• Service Provider - Duly constituted business corporations who provide
components of offshore gaming operations to offshore gaming
operators. (Sec. 3 (l) (5), RA 11521)
 Amendments to the Anti-Money Laundering Act
Additional Unlawful Activities

1. Violation of Section 19 (A)(3) of Republic Act No. 10697, otherwise known

as “The Strategic Trade Management Act”, in relation to Proliferation of
WMD and PF pursuant to UNSC Resolution Nos. 1718 of 2006 and 2231 of
2015
 Amendments to the Anti-Money Laundering Act
Additional Unlawful Activities

2. Violations of Section 254 of Chapter II, Title X of the “National Internal Revenue
Code of 1997”, as amended, where the deficiency basic tax due in the final
assessment is in excess of Twenty-Five Million Pesos (P25,000,000.00) per taxable
year, for each tax type covered and there has been a finding of probable cause by
the competent authority:

– there must be a finding of fraud, willful misrepresentation or malicious intent on the part
of the taxpayer:
– In no case shall the AMLC institute forfeiture proceedings to recover monetary
instruments, property or proceeds representing, involving, or relating to a tax crime, if the
same has already been recovered or collected by the Bureau of Internal Revenue (BIR)
in a separate proceeding
 Amendments to the Anti-Money Laundering Act
Additional Unlawful Activities

3. Felonies and Offenses of a similar nature that are punishable under the
penal laws of other countries
 Amendments to the Anti-Money Laundering Act
Targeted Financial Sanctions

• Section 2 of the AMLA provides as an additional declared policy of the state:

• To implement targeted financial sanctions related to the financing of the

proliferation of weapons of mass destruction, terrorism, and financing of terrorism,
pursuant to the resolutions of the United Nations Security Council.

• targeted financial sanctions “refer to both asset freezing and prohibition to prevent
funds or other assets from being made available, directly or indirectly, for the benefit
of any individual, natural or legal persons or entity designated pursuant to relevant
United Nations Security Council resolutions and its designation processes. (Sec 3(o),
AMLA)
 Amendments to the Anti-Money Laundering Act
Targeted Financial Sanctions

• The AMLC now has the power to issue a freeze order ex parte.

• For purposes of implementing targeted financial sanctions in relation

to proliferation of weapons of mass destruction and its financing, the
AMLC shall have the power to issue, ex parte, an order to freeze
without delay. (Section 10 (b), AMLA)
Amendments to the Anti-Money Laundering Act
Targeted Financial Sanctions

Distinction between previous Section 10 (now 10 [a]) of the AMLA and the
new Section 10 (b):
Section 10 (a) of AMLA New Section 10 (b)

Underlying Unlawful activity, as defined In “Proliferation of weapons of

Activity Section 3(i) mass destruction and its
financing” as provided under
Section 3(15)
Role of AMLC Applies for the freeze order via Issues the freeze order ex parte
verified ex parte petition
Amendments to the Anti-Money Laundering Act

Distinction between previous Section 10 (now 10 [a]) of the AMLA and the
new Section 10 (b)
Section 10 (a) of AMLA New Section 10 (b)

Who issues the Court of Appeals AMLC

freeze order
Requirements for “Verified ex parte petition by the “For purposes of implementing
issuing freeze AMLC, after determination that targeted financial sanctions in
order probable cause exists that any relation to proliferation of
monetary instrument or property is in weapons of mass destruction
any way related to an unlawful and its financing, as provided
activity” under Section 3(15)
Amendments to the Anti-Money Laundering Act

Distinction between previous Section 10 (now 10 [a]) of the AMLA and the
new Section 10 (b)
Section 10 (a) of AMLA New Section 10 (b)

Effectivity of “Effective immediately for a period of “Effective until the basis for its
the freeze twenty (20) days. May be extended after issuance shall have been lifted.”
order summary hearing but the total period of
the freeze order issued by the Court of
Appeals under this provision shall not
exceed six (6) months.
If there is no case filed against a person
whose account has been frozen within the
period determined by the Court of
Appeals, not exceeding six (6) months,
the freeze
order shall be deemed ipso facto lifted.”
Amendments to the Anti-Money Laundering Act
Distinction between previous Section 10 (now 10 [a]) of the AMLA and the
new Section 10 (b)
Section 10 (a) of AMLA
Procedure “Within the twenty (20)-day period,
the Court of Appeals shall conduct a
summary hearing, with notice to the
parties, to determine whether or not
to modify or lift the freeze order, or
extend its effectivity.”
New Section 10 (b)
“During the effectivity of the
freeze order, the aggrieved party
may, within twenty (20) days
from issuance, file with the Court
of Appeals a petition to
determine the basis of the
freeze order according to the
principle of effective judicial
protection.”
 Amendments to the Anti-Money Laundering Act
Distinction between previous Section 10 (now 10 [a]) of the AMLA and the new
Section 10 (b)
Section 10 (a) of AMLA
Limitations “The freeze order or asset preservation
order issued under this Act shall be limited
only to the amount of cash or monetary
instrument or value of property that court
finds there is probable cause to be
considered as proceeds of a predicate
offense, and the freeze order or asset
preservation order shall not apply to
amounts in the same account in excess of
the amount or value of the proceeds of the
predicate offense.”
New Section 10 (b)
“The person whose property or
funds have been frozen may
withdraw such sums as the
AMLC determines to be
reasonably needed for monthly
family needs and sustenance
including the services of counsel
and the family medical needs of
such person.”
 Amendments to the Anti-Money Laundering Act
Distinction between previous Section 10 (now 10 [a]) of the AMLA and the new
Section 10 (b)

Section 10 (a) of AMLA New Section 10 (b)

Who may issue

injunctions or Court of Appeals and the Supreme Court only.
TROs against
the freeze order
 Amendments to the Anti-Money Laundering Act
Other Amendments:

1. The AMLC is now expressly allowed to “apply for the issuance of a search and
seizure order” or a “subpoena ad testificandum and/or subpoena duces tecum with
any competent court.” (Sections 7 (13) and (14), AMLA)

2. It also has the power to preserve, manage, or dispose assets pursuant to a freeze
order, asset preservation order, or judgment of forfeiture. (Sections 7 (16), AMLA)

3. The AMLC and its Secretariat shall securely protect information received or
processed and shall not reveal, in any manner, any information known to them by
reason of their office. This prohibition shall apply even after their separation from
the AMLC. (Sec. 8 [a], AMLA)
 Amendments to the Anti-Money Laundering Act
Other Amendments:

4. No court shall issue a temporary restraining order (TRO) or a writ of injunction against any
provisional asset preservation order or asset preservation order, except the Court of
Appeals or the Supreme Court. (Sec. 12(d), AMLA)

5. Nothing contained therein nor in related antecedent laws or existing agreements shall be
construed to allow the AMLC to participate in any manner in the operations of the Bureau of
Internal Revenue (BIR). the AMLC may, however, coordinate with the BIR on investigations
in relation to violations of Section 254 (i.e., tax evasion) of the NIRC, as amended, as a
predicate offense to money laundering. (Sec.20, AMLA)