The Bangko Sentral ng Pilipinas (BSP) has started investigating bank accounts linked to the flood-control corruption controversy, using the Anti-Financial Account Scamming Act (AFASA) for the first time.
The law, also known as Republic Act 12010, took effect in June this year. It criminalizes money muling activities, which involve using financial accounts to obtain, receive, deposit, transfer, or withdraw funds known to come from crimes.
The BSP said the inquiry also serves as a reminder to regulated entities to comply with provisions on the temporary holding of funds. The move follows an official request from Public Works Secretary Vince Dizon.
“The BSP is using AFASA for the first time to join and assist other agencies in investigating and prosecuting the persons alleged to be involved in these crimes,” BSP General Counsel Roberto Figueroa said. “We are also keen to leverage this authority to uphold the integrity of our financial system against criminal actors.”
The BSP earlier supported the passage of AFASA, which gives it the power to look into accounts suspected of being used for unlawful activities. Under the law, the usual bank secrecy and data privacy rules do not apply to accounts under investigation.
Information gathered from the inquiry can be used in prosecuting AFASA-related cases. Penalties for money muling include six to eight years in prison and fines of P100,000 to P500,000. Convictions may also carry civil liabilities such as restitution and the forfeiture of assets used in committing the crime.
The BSP’s action comes in addition to the Court of Appeals’ freeze order on the same accounts, issued in response to a petition from the Anti-Money Laundering Council (AMLC).
Money laundering, which differs from money muling, involves making illegally obtained money appear legitimate by passing it through various transactions such as buying property, gambling, or purchasing luxury items before reintroducing it into the economy.