Anti-Money Laundering Principles in the Philippines

Podcast

Play an AI-generated podcast conversation about this lesson

Questions and Answers

What amount in pesos qualifies as a cash transaction involving real estate developers or brokers that must be reported?

P5,000,000.00

P10,000,000.00

P2,500,000.00

P7,500,000.00 (correct)

Which of the following best describes a ‘Cross-Border Wire Transfer’?

A wire transfer solely between local financial institutions.

A wire transfer involving different countries' banks. (correct)

Any wire transfer where both banks are in the same city.

A wire transfer within the same country.

Who is classified as a ‘Customer/Client’ in the context of covered transactions?

Only the transactors and agents of beneficial owners.

Only the beneficial owners.

Any person maintaining an account or transacting with a covered person. (correct)

Individuals who do not hold any accounts but have inquiries.

Which of the following statements about beneficial owners is accurate?

They own or control customers or accounts and conduct transactions. Signup and view all the answers

Who falls under the definition of a beneficiary within the Customer/Client category?

Beneficiaries of trusts, insurance policies, and remittance transactions. Signup and view all the answers

What does 'Law Enforcement Agency' (LEA) include?

Philippine National Police, National Bureau of Investigation, and other government agencies Signup and view all the answers

Which of the following best defines 'Materially-linked Accounts'?

Accounts related to the person under inquiry, whether directly or indirectly Signup and view all the answers

Which statement about 'In Trust For' accounts is correct?

They can involve the trustor or the trustee who relates to the person under inquiry Signup and view all the answers

Which option correctly describes accounts held for the benefit of a person under a freeze order?

They can be accounts beneficial to the person, regardless of ownership status Signup and view all the answers

What best characterizes the accounts of juridical persons as mentioned?

They are owned, controlled, or effectively controlled by the person under inquiry Signup and view all the answers

Which of the following defines 'Instrumentality'?

Any monetary instrument or property used to finance unlawful activity Signup and view all the answers

What best describes 'Independent Legal/Accounting Professional'?

Lawyers or accountants providing services in private practice Signup and view all the answers

What does 'Institutional Risk Assessment' aim to achieve?

To identify and assess money laundering and terrorist financing threats Signup and view all the answers

Which of the following options accurately defines 'Immediate Family Member'?

Individuals related to the PEP within the second degree of consanguinity or affinity Signup and view all the answers

What does 'Information and Communication Technology' encompass?

A comprehensive range of electronic means for information processing and transmission Signup and view all the answers

Which entity is responsible for regulating the insurance industry in the Philippines?

Insurance Commission Signup and view all the answers

What is characterized as an 'Intermediary Financial Institution'?

A financial institution in a payment chain that transmits wire transfers on behalf of others Signup and view all the answers

Which description best fits 'Jewelry'?

Items that derive fifty percent or more of their value from jewels, precious metals or stones Signup and view all the answers

What does National Risk Assessment (NRA) aim to mitigate?

Illicit flow of funds and transactions Signup and view all the answers

Which of the following best defines a Non-Profit Organization (NPO)?

A juridical person engaging in charitable and social purposes Signup and view all the answers

Who qualifies as an Offender in the context provided?

Any person who commits a money laundering offense Signup and view all the answers

What does the term Offshore Gaming Operator (OGO) refer to?

An entity offering online games of chance via the internet Signup and view all the answers

What does Offshore Gaming Operator Service Provider (OGO-SP) do?

Provides components of offshore gaming operations to OGOs Signup and view all the answers

What is the purpose of the Ongoing Monitoring Process (OMP)?

To conduct continuing due diligence and update identification information Signup and view all the answers

Which entity is known as the Originating/Ordering Financial Institution?

The institution that initiates a wire transfer on behalf of the originator Signup and view all the answers

Who is considered the Originator in a wire transfer scenario?

The account holder allowing the wire transfer from their account Signup and view all the answers

What does 'Related Account' refer to in the context of a freeze order?

An account containing funds directly involved in the freeze order Signup and view all the answers

Which of the following best defines 'Source of Wealth'?

The resource from which a customer’s wealth originates, including various income sources Signup and view all the answers

What does 'Straight-through Processing' imply in financial transactions?

Payments conducted electronically without the need for manual intervention Signup and view all the answers

What is the role of the 'Supervising Authority' (SA)?

To supervise or regulate financial institutions and DNFBPs as designated by law Signup and view all the answers

How is 'Substantial Evidence' defined?

Level of evidence that justifies a conclusion regarding a violation Signup and view all the answers

What does the term 'Ship-Based Casino' refer to?

Gambling facilities that operate on board watercraft Signup and view all the answers

What does 'Strategic Analysis' aim to achieve?

High-level macro analysis to understand patterns and inform policy Signup and view all the answers

What does the 'Source of Fund' refer to?

The origin of funds involved in a transaction or relationship Signup and view all the answers

What is the primary focus of Tactical Analysis?

Developing investigative priorities and resource deployment Signup and view all the answers

What do Targeted Financial Sanctions aim to prevent?

Funds from benefitting designated individuals or entities Signup and view all the answers

Which statement best defines Terrorism Financing (TF)?

Any act related to facilitating financial support for terrorist activities Signup and view all the answers

Who is responsible for establishing a trust according to the provided definitions?

Trustor/Grantor/Settlor Signup and view all the answers

What is included in the definition of a 'Transaction'?

Establishing a right or obligation between parties Signup and view all the answers

What is a common characteristic of a Trustee?

They hold property for the benefit of another person Signup and view all the answers

What does the term ‘Suspicious Circumstance’ refer to?

Indicators of a potentially fraudulent transaction Signup and view all the answers

Which aspect is least associated with Tactical Analysis?

Long-term strategic planning Signup and view all the answers

Study Notes

Governing Principles

Anti-money laundering/counter-terrorism financing (AML/CTF) regime in the Philippines is governed by principles.
The AMLC (Anti-Money Laundering Council) is an independent financial intelligence unit, upholding ethical standards and efficiency.
AML/CTF laws, rules, and regulations are implemented using a risk-based approach, ensuring effective safeguards while integrating the financially excluded into the regulated financial sector.
Strong compliance culture, good governance, and high ethical standards are crucial foundations for an effective AML/CTF regime, developed through capacity-building, and deterrence of violations via sanctions.
Sound risk management systems are essential to identify, assess, mitigate, monitor, and control risks associated with money laundering/terrorism financing.
Timely and effective domestic and international cooperation is critical for investigation and prosecution of money laundering/terrorism financing.
AML/CTF implementation should adhere to international AML/CTF standards and best practices.
Constitutional requirements related to due process, injunctions against ex post facto laws, and bills of attainder must be observed.

Definitions

Account: Bank account, electronic money account, investment account, insurance policy, or similar contract/service agreement where customer funds are held.
Anti-Money Laundering Act (AMLA): Republic Act No. 9160, as amended
Anti-Money Laundering Council (AMLC): Philippines' central AML/CTF authority and financial intelligence unit.
Appropriate Government Agency (AGA): PAGCOR, CEZA, APECO, or other government agencies authorized for casino operations.
Asset: Monetary instrument, property, or both.
Asset Preservation Order (APO): Provisional remedy for preserving monetary instruments/properties related to unlawful activity.
Average Due Diligence (ADD): Standard customer due diligence in medium-risk money laundering/terrorism financing cases.
Bangko Sentral ng Pilipinas (BSP): Central bank of the Philippines.
Bank Inquiry (BI): Provisional remedy for examining or inquiring into bank or non-bank accounts, notwithstanding bank secrecy laws.
Bearer Negotiable Instruments (BNIs): Monetary instruments in bearer form (e.g., traveler's checks, checks, promissory notes, money orders).
Bearer Shares: Negotiable instruments that grant ownership to the bearer.
Beneficial Owner: Natural person ultimately controlling a customer or juridical person.
Beneficiary: Person(s) benefiting from an account or transaction (e.g., trust agreements).
Beneficiary Financial Institution: Financial institution receiving wire transfers to make funds available to the beneficiary.
Biometric Information: Unique features of a person (photo, fingerprint, iris scan).
Casino: Business authorized to conduct gaming operations.
Casino Cash Transaction: Cash transactions involving casino payouts or receipts.
Civil Forfeiture (CF): Non-conviction-based process to forfeit monetary instruments related to unlawful activity.
Close Relationship/Associate: Persons known to maintain a close relationship with a PEP (Politically Exposed Person).
Correspondent Banking: Banking services provided by one bank to another.
Company Service Provider (CSP): Provides services needed for customers who cannot perform/offer services directly due to financial or operational reasons.

Studying That Suits You

Use AI to generate personalized quizzes and flashcards to suit your learning preferences.

Description

This quiz covers the governing principles of the Anti-Money Laundering and Counter-Terrorism Financing (AML/CTF) regime in the Philippines. It highlights the role of the Anti-Money Laundering Council, the importance of good governance, and the necessary risk-based approaches for effective compliance. Test your understanding of these key concepts and their implications for financial regulation.