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Questions and Answers
What is required for the AMLC to file a petition for forfeiture?
What is the maximum duration for which a freeze order can be issued by the Court of Appeals?
Which of the following actions can lead to the extension or modification of the freeze order?
What happens if the monetary instrument cannot be located during the forfeiture process?
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Who must be notified during the summary hearing conducted by the Court of Appeals?
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What does 'Serial Payment' refer to?
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Which of the following describes a 'Shell Bank'?
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Which activity does NOT fall under the definition of a 'Virtual Asset Provider'?
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What is 'Source of Wealth' defined as?
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Which statement accurately defines a 'Virtual Asset'?
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Which of the following best describes 'Source of Fund'?
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What does 'United Nations Security Council' primarily focus on?
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What does the term 'Transfer' refer to in the context of virtual assets?
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What does the 'Proliferation of Weapons of Mass Destruction' refer to?
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Which act outlines the investigation of suspicious transactions related to money laundering?
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What is a requirement before applying for the freezing of alleged laundered monetary instruments?
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What measures can be implemented to counteract money laundering?
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Which of the following is NOT defined as a Weapon of Mass Destruction?
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What does the Anti-Money Laundering Council (AMLC) primarily investigate?
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What type of weapons are classified under 'Weapons of Mass Destruction'?
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Which body can request assistance from foreign states for anti-money laundering operations?
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What is the amount designated as a suspicious transaction involving cash?
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Which substance contains at least 68.3% gold?
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What defines a 'Suspicious Transaction'?
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What is the minimum amount for transactions by jewelry dealers that is considered suspicious?
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What type of gems are considered 'Precious Stones'?
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Which metal has a plating solution mentioned in the context of suspicious transactions?
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What does 'suspicion' refer to in the context of transactions?
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What percentage of silver is contained in potassium silver cyanide?
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What does a Freeze Order aim to achieve under the Anti-Terrorism Act of 2020?
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What triggers the authority to issue a Freeze Order?
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What is defined as a 'Related Account' in the context of the Freeze Order?
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Which authority is authorized to issue a freeze order based on its own initiative?
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Which of the following does NOT fall under the definition of unlawful activities in relation to freezing assets?
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What is the relationship between a Freeze Order and an unlawful activity?
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In relation to a Freeze Order, what does 'property or funds' refer to?
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What must be established for the competent court to issue a Freeze Order?
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Study Notes
AMLC Law Definitions
- Serial Payment: A direct chain of payments where the wire transfer and accompanying message travel together from the originating financial institution to the beneficiary financial institution, possibly through intermediary institutions.
- Shell Bank: A bank with no physical presence in its country of incorporation and licensing, not affiliated with a regulated financial group subject to effective consolidated supervision.
- Source of Funds: The origin of funds or other monetary instrument subject to a transaction, including cash on hand, safety deposit box contents, and specific bank or investment accounts.
- Source of Wealth: The resources from which a customer's wealth, including monetary instruments and properties, derives.
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Virtual Asset Provider: A person who, as a business, engages in one or more of the following activities for or on behalf of another person:
- Exchange between virtual assets and fiat currencies
- Exchange between different forms of virtual assets
- Transferring virtual assets between addresses or accounts
- Safekeeping and administration of virtual assets or instruments controlling them
- Providing financial services related to the offer and/or sale of virtual assets.
- Virtual Asset: A digital representation of value that can be traded, transferred, and used for payment or investment.
- Suspicious Transaction: Any transaction, regardless of amount, where any suspicious circumstance, as defined, is determined to exist based on suspicion or, if available, reasonable grounds.
- Suspicion: A person's state of mind, considering the customer profile and possibility of suspicious circumstances, based on their skills, experience, and understanding.
Suspicious Transactions
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Suspicious Circumstances: Transactions involving a covered person, regardless of amount, where any of the following occur:
- Real estate developers and brokers engaging in single cash transactions exceeding P7,500,000 or its equivalent in any currency.
- Jewelers dealing in precious stones, engaging in transactions exceeding P1,000,000.
- Transactions related to fraudulent practices and other violations under the Securities Regulation Code of 2000 (Republic Act No. 8799).
- Transactions violating Section 9(a)(3) of Republic Act No. 10697 ("Strategic Trade Management Act"), related to the proliferation of weapons of mass destruction and its financing (as per UN Security Council Resolutions 1718 of 2006 and 2231 of 2015).
- Proliferation of Weapons of Mass Destruction: Activities related to the manufacture, acquisition, possession, development, export, trans-shipment, brokering, transport, transfer, stockpiling, or use of weapons of mass destruction, in violation of national laws or international obligations.
- Weapons of Mass Destruction (WMD): Chemical, biological, radiological, or nuclear weapons capable of causing significant destruction or mass casualties.
AMLC Powers
- Review of Transactions: The AMLC can examine any particular deposit or investment, including related accounts, in any banking or non-bank financial institution, upon order of a competent court based on an ex parte application in cases of violations of the Act, where probable cause exists that the accounts are related to unlawful activities or money laundering offenses.
- Investigation of Suspicious Transactions: The AMLC is authorized to investigate suspicious transactions and covered transactions deemed suspicious following an investigation, as well as money laundering activities and other violations of the Act.
- Freezing Orders: The AMLC, with authority from the Court of Appeals, can freeze any monetary instrument or property alleged to be laundered, proceeds of, or instrumentalities used in any unlawful activity, after an ex parte petition with probable cause.
Freezing Procedures
- Freeze Order (FO): A provisional remedy blocking or restraining monetary instruments or properties related to unlawful activity, without affecting ownership.
- Freezing of Monetary Instrument or Property: The Court of Appeals, upon verified ex parte petition by the AMLC with probable cause, can issue a freeze order effective immediately for up to 20 days. This order must be reviewed through a summary hearing within the 20-day period to determine if the freeze should be modified, lifted, or extended. The total freeze order period cannot exceed six months.
Forfeiture of Monetary Instrument or Property
- Forfeiture: The AMLC, if it determines that property or funds are related to an unlawful activity or a money laundering offense, will file a verified ex parte petition for forfeiture in the appropriate court.
- Forfeiture Scope: Forfeiture includes monetary instruments or property with equivalent value to the property related to unlawful activity, when the former cannot be located, has been altered or destroyed, or is otherwise rendered worthless by any act or omission, or has been concealed, removed, converted, or disposed of.
Authority to Freeze under The Anti-Terrorism Act of 2020
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ATC Freeze Order (FO): Upon issuance of a preliminary order of proscription or designation under the Anti-Terrorism Act, the AMLC, on its own initiative or by request of the Anti-Terrorism Council (ATC), can issue an ex parte order without delay to freeze:
- Property or funds related to terrorism financing, as defined in Republic Act No. 10168 ("The Terrorism Financing Prevention and Suppression Act of 2012"), or any violation of specific sections of the Anti-Terrorism Act.
- Property or funds of any person where there is probable cause to believe that the property is related to terrorism financing, as defined in Republic Act No. 10168, or any violation of specific sections of the Anti-Terrorism Act.
- Related Account: An account where the funds and sources originated or are materially linked to the monetary instruments or properties subject to a freeze order or order of inquiry.
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Description
Test your knowledge on essential definitions related to Anti-Money Laundering and Counter-Terrorism Financing (AMLC). This quiz covers terms such as Serial Payment, Shell Bank, Source of Funds, and more. Understanding these definitions is crucial for compliance and effective financial crime prevention.
