FIFTEENTH CONGRESS )
REPUBLIC OF THE PHILIPPINES )
FIRST REGULAR SESSION )

HOUSE OF REPRESENTATIVES

Introduced by Representative Rufus B. Rodriguez and
Representative Maximo B. Rodriguez, Jr.

House Bill No. 698

EXPLANATORY NOTE

This bill was originally introduced as House Bill No. 3053 by the undersigned
Rufus B. Rodriguez during the Fourteenth Congress. It was approved by the
Committee on Banks and Financial Intermediaries as substitute House Bill No. 5077
under Committee Report No. 1221 dated September 9, 2008. it was approved on 2%!
reading on September 16, 2008.

This bill seeks to strengthen further the anti-money laundering law, amending
for the purpose Republic Act No. 9160 (RA9160), or the “Anti-Money Laundering
Act (AMLA) of 2001”, as amended.

RA 9160 defines the offense of money laundering and how it may be
committed. It also creates the Anti-Money Laundering Council (AMLC) and defines
its powers and functions. Under RA 9160, the AMLC was authorized to freeze any
monetary instrument or property alleged to be the proceeds of any unlawful activity.
Republic Act No. 9194, however, which amends RA 9160 took away that power from
the AMLC and gave it to the Court of Appeals. Likewise, the amendatory Act
abolished the system of rewards and incentives granted by RA 9160. This bill
therefore seeks to restore said provisions.

As proposed, this bill grants the AMLC a portion of the proceeds from money
laundering recovered and forfeited in favor of the government. It also adds certain
ctimes like tax evasion, human smuggling, trafficking in persons and bribery among
the “unlawful activity” as defined under RA 9160, as amended. It also requires
casinos and other gambling establishments to comply with the AMLA reporting
requirements.


In the past, it was easy for leaders of states, businessmen and other
unscrupulous persons to launder their money arising from illegal activities in the
absence of the anti-money laundering law. Now that we have one, it is imperative to
give more teeth to the law to enable the government to comply with international
standards against money laundering, and to make it more difficult for money
launderers to divert to the legal front money taken from illegal activities.

In view of the foregoing, approval of this bill is urgently requested.

RUPUS B. RO} iGUEZ

Yi

MAXIMO B. RODRIGUEZ, JR.


FIFTEENTH CONGRESS )
REPUBLIC OF THE PHILIPPINES )
FIRST REGULAR SESSION: )

HOUSE OF REPRESENTATIVES
698

Tntroduced by Representative Rufus B. Rodriguez and
Representative Maximo B. Rodriguez, Jr.

AN ACT
TO FURTHER STRENGTHEN THE ANTI-MONEY
LAUNDERING LAW, AMENDING FOR THE PURPOSE
REPUBLIC ACT NO. 9160 OTHERWISE KNOWN AS THE
“ANTI-MONEY LAUNDERING ACT OF 2001”, AS AMENDED,
AND FOR OTHER PURPOSES.

Be it enacted by the Senate and House of Representatives of the
Philippines in Congress assembled:

SECTION 1. Section 3 (a) of Republic Act No, 9160 is hereby amended to read as
follows:
“(a) “Covered institution OR INDIVIDUAL” refers to:

(1) Banks, non-banks, quasi-banks, trust entities and all other
institutions and their subsidiaries and affiliates supervised or regulated by the
Bangko Sentral ng Pilipinas (BSP);

(2) Insurance companies and all other institutions supervised or
regulated by the Insurance Commission; and

(3) @ securities dealers, brokers, salesmen, investment houses and
other similar entities managing securities or rendering services as investment
agent, advisor or consultant; (ji) mutual funds, close-end investment
companies, common trust funds, pre-need companies and other similar
entities; (ii) foreign exchange corporations, money changers, money payment
remittance and transfer companies, and other similar entities; and (iv) 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
Securities and Exchange Commission.

(4) NON-FINANCIAL BUSINESSES AND PROFESSIONS, SUCH
AS: (i) CASINOS, INCLUDING INTERNET CASINOS; (ii) REAL ESTATE
AGENT; (iii) DEALERS IN PRECIOUS METALS; (iv) DEALERS IN
PRECIOUS STONES; AND (v) LAWYERS, NOTARIES, OTHER
INDEPENDENT LEGAL PROFESSIONALS AND ACCOUNTANTS
WHEN THEY PREPARE FOR OR CARRY OUT TRANSACTIONS FOR
THEIR CLIENTS; MONEY, MONETARY INSTRUMENT, PROPERTY
OR OTHER ASSETS.”


SEC. 2. Section 3 (i) of the same act, as amended, is hereby further amended to read
as follows:

“(i “Unlawful Activity” refers to any act or omission or series or combination
thereof involving or having direct relation to the following:

1) Kidnapping for ransom under Article 267 of Act No. 3815,
otherwise known as the Revised Penal Code, as amended;

2) Sections 4, 5, 6, 8, 9, 10, 11, 12, 13, 14, 15 and 16 of Republic
Act No. 9165 otherwise known as the Comprehensive
Dangerous Drugs Act of 2002;

3) Section 3, paragraphs B, C, E, G, H and I of Republic Act No.
3019, as amended, otherwise known as the Anti-Graft and
Corrupt Practices Act;

4) Plunder under Republic Act No. 7080, as amended;

5) Robbery and extortion under Articles 294, 295, 296, 299, 300,
301 and 302 of the Revised Penal Code, as amended;

6) Jueteng and Masiao punished as illegal gambling under
Presidential Decree No. 1602;

7) Piracy on the high seas under the Revised Penal Code, as
amended;

8) Qualified theft under Article 310 of the Revised Penal Code, as
amended;

9) Swindling under Article 315 of the Revised Penal Code, as
amended;

10) Smuggling under Republic Act Nos. 455 and 1937;

11) Violations under Republic Act No. 8792, otherwise known as
the Electronic Commerce Act of 2000;

12)Hijacking and other violations under Republic Act No. 6235;
destructive arson and murder, as defined under the Revised
Penal Code, as amended;

13)TERRORISM AND CONSPIRACY TO COMMIT
TERRORISM AS DEFINED AND PENALIZED UNDER
REPUBLIC ACT NO. 9371, INCLUDING ITS FINANCING;

14)BRIBERY UNDER ARTICLES 210, 211, 211-A OF THE
REVISED PENAL CODE, AS AMENDED;

15) CORRUPTION OF PUBLIC OFFICERS UNDER ARTICLE
212 OF THE REVISED PENAL CODE AS AMENDED;

16)FRAUDS AND ILLEGAL EXACTIONS AND
TRANSACTIONS UNDER ARTICLES 213, 214, 215, 216
OF THE REVISED PENAL CODE, AS AMENDED;

17)MALVERSATION OF PUBLIC FUNDS AND PROPERTY
UNDER ARTICLES 217 AND 222 OF THE REVISED
PENAL CODE, AS AMENDED;

18) FORGERIES AND COUNTERFEITING UNDER ARTICLES
163, 166, 167, 168, 176 OF THE REVISED PENAL CODE,
AS AMENDED;

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 SECTIONS 68 TO 79 OF CHAPTER IV
OF PRESIDENTIAL DECREE NO. 705, OTHERWISE



KNOWN AS THE REVISED FORESTRY CODE OF THE
PHILIPPINES, AS AMENDED;

21) VIOLATIONS OF SECTIONS 86 TO 106 OF CHAPTER VI
OF REPUBLIC ACT NO. 8550, OTHERWISE KNOWN AS
‘THE PHILIPPINE FISHERIES CODE OF 1998;

22) VIOLATIONS OF SECTIONS 101 TO 107 AND 110 OF
REPUBLIC ACT NO. 7942, OTHERWISE KNOWN AS THE
PHILIPPINE MINING ACT OF 1995;

23) VIOLATIONS OF SECTION 27 (c), (e), (f), (g) AND (i) OF
REPUBLIC ACT NO 9147, OTHERWISE KNOWN AS THE
WILDLIFE RESOURCES CONSERVATION AND
PROTECTION ACT;

24) VIOLATION OF SECTION 7 (b) OF REPUBLIC ACT NO.
9072, OTHERWISE KNOWN AS THE NATIONAL CAVES.
AND CAVE RESOURCES MANAGEMENT AND
PROTECTION ACT;

23) VIOLATION OF REPUBLIC ACT NO. 6539 OTHERWISE
KNOWN AS THE ANTI-CARNAPPING ACT OF 2002, AS
AMENDED;

26) Fraudulent practices and other violations under Republic Act
No. 8799, otherwise known as the Securities Regulations Code
of 2000;

27) Felonies or offenses of a similar nature that are punishable
under the penal laws of other countries;

SEC. 3. Section 9 (©), first paragraph, of the same act, as amended, is hereby further
amended to read as follows:

“(©) Reporting of Covered and Suspicious Transactions. ~ Covered institutions
shall report to the AMLC alll covered transactions within TEN (10) working days
from occurrence thereof AND SUSPICIOUS TRANSACTIONS WITHIN FIVE (5)
WORKING DAYS FROM THE TIME THE COVERED INSTITUTION OR ANY
OF ITS PERSONNEL HAS DETERMINED BASED ON ANY OF THE
CIRCUMSTANCES UNDER SECTION 3 (b)-1 OF THIS ACT THAT THE
TRANSACTION IS RELATED TO ANY UNLAWFUL ACTIVITY, unless the
AMLC prescribes a different period not exceeding ten (10) working days.”

SEC. 4, Section 10 of the same act, as amended, is hereby further amended to read as
follows:

“SEC. 10. Freezing of Monetary Instrument or Property. ~The Court of
Appeals, upon application ex parte by the AMLC and after determination that
probable cause exists that any monetary instrument or property is in any way related
to an unlawful activity as defined in Section 3(j) hereof, may issue a freeze order
which shall be effective immediately ON THE SAID MONETARY INSTRUMENT
OR PROPERTY INCLUDING SUCH RELATED WEB OF ACCOUNTS AS MAY
BE IDENTIFIED BY THE AMLC, FOR A PERIOD NOT EXCEEDING THIRTY
(30) DAYS. NOTICE TO THE PURPOTED OWNER THAT THIS MONETARY
INSTRUMENT OR PROPERTY HAS BEEN FROZEN SHALL BE ISSUED
SIMULTANEOUSLY WITH THE FREEZE ORDER. THE PURPORTED OWNER,
OF THE MONETARY INSTRUMENT OR PROPERTY SHALL HAVE FIVE (5)
WORKING DAYS UPON RECEIPT OF THE NOTICE TO EXPLAIN WHY THE


FREEZE ORDER SHOULD BE LIFTED. THE COURT OF APPEALS HAS TEN
(10) WORKING DAYS TO RESOLVE THE FREEZE ORDER CASE FROM
RECEIPT OF THE PURPORTED OWNER’S EXPLANATION. IF THE COURT
OF APPEALS FAILS TO ACT WITHIN TEN (10) WORKING DAYS FROM
RECEIPT OF PURPORTED OWNER’S EXPLANATION, THE FREEZE ORDER
SHALL AUTOMATICALLY BE DISSOLVED.

“UPON PETITION BY AMLC BEFORE THE EXPIRATION OF THIRTY
(30) DAYS FROM THE ISSUANCE OF THE FREEZE ORDER, THE COURT OF
APPEALS MAY EXTEND ITS EFFECTIVITY FOR A PERIOD NOT
EXCEEDING SIX (6) MONTHS: PROVIDED, THAT THE RUNNING OF THE
THIRTY (30) DAY PERIOD SHALL NOT RUN PENDING THE COURT’S
DECISION TO EXTEND THE PERIOD.

“NO COURT, EXCEPT THE SUPREME COURT, MAY ISSUE A
TEMPORARY RESTRAINING ORDER OR WRIT OF INJUNCTION AGAINST
ANY FREEZE ORDER.”

SEC. 5. Section 11 of the act, as amended, is further amended to read as follows:

“SEC.I1. 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 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 BASED ON AN EX
PARTE APPLICATION in cases of violations of this Act when it has been
established that there is probable cause that the deposits or investments involved are
related to an unlawful activity as defined in Sections 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 Section 3 (i), (2), (12) AND (13).

“To ensure compliance with this Act, the BSP may inquire into or examine
any deposit or investment with any banking institution or non-bank financial
institution when the examination is made in the course of a periodic or special
examination, in accordance with the rules of examination of the BSP.”

SEC. 6. Section 12 (a) of the same act is hereby amended to read as follows:

“(@) Civil Forfeiture. - UPON DETERMINATION THAT PROBABLE
CAUSE EXISTS THAT ANY MONETARY INSTRUMENT OR PROPERTY IS
FOUND TO BE RELATED IN ANY WAY TO AN UNLAWFUL ACTIVITY AS
DEFINED UNDER SECTION 3 (i) HEREOF OR A LAUNDERING OFFENSE
UNDER SECTION 4 HEREOF, THE AMLC SHALL FILE, THROUGH THE
OFFICE OF THE SOLICITOR GENERAL, A PETITION FOR FORFEITURE AND
THE RULES OF COURT ON CIVIL FORFEITURE SHALL APPLY.”

SEC. 7. A new subsection (¢) is hereby added to Section 12 of the same Act to read
as follows”

“(¢) DISPOSITION OF FORFEITED ASSETS AND RETENTION. - THE
AMLC SHALL RETAIN TWENTY-FIVE PERCENT (25%) OF THE TOTAL
ASSETS FORFEITED LESS THE COST OF LITIGATION. THE REMAINING
PORTION SHALL BE TURNED OVER TO THE NATIONAL TREASURY. THE
RETAINED AMOUNT SHALL BE UTILIZED BY THE AMLC FOR
OPERATIONS AND MAINTENANCE.”


SEC. 8. Section 15 of the same Act is hereby restored as follows:

“SEC. 15. SYSTEM OF INCENTIVES AND REWARDS. - A SYSTEM OF
SPECIAL INCENTIVES AND REWARDS IS HEREBY ESTABLISHED TO BE
GIVEN TO THE APPROPRIATE GOVERNMENT AGENCY AND ITS
PERSONNEL THAT LED AND INITIATED AN _ INVESTIGATION,
PROSECUTION AND CONVICTION OF PERSONS INVOLVED IN THE
OFFENSE PENALIZED IN SECTION 4 OF THIS ACT.”

SEC. 9. This Act shall take effect fifteen (15) days following its publication in at least
two (2) national newspapers of general circulation.

Approved,