BANKING BOUNCING CHECKS

LAWS
PHILIPPINE DEPOSIT INSURANCE
CORPORATION
SECRECY OF BANK DEPOSITS
TRUTH IN LENDING ACT
ANTI-MONEY LAUNDERING ACT
 THE TEAM

SOPHIA JOY EVIA MAITA GRAFIEL SHERINA LAGUADOR

PHILIPPINE
DEPOSIT
INSURANCE
CORPORATION
(RA 3591 as amended by RA
7400, RA 930. [2004], RA 9576
[2009], & RA 10846 [2016])
WHAT IS PHILIPPINE DEPOSIT
INSURANCE CORPORATION (PDIC)?

Philippine Deposit Insurance Corporation insure the deposits

of all banks which are entitled to the benefits of insurance
under the PDIC law.

PDIC as a basic policy, promote and safeguard the interests

of the depositing public by providing insurance coverage on all
insured deposits and helping maintain a sound and stable
banking system.
WHAT IS THE PURPOSE OF PHILIPPINE
DEPOSIT INSURANCE CORPORATION
(PDIC)?

The purpose of the PDIC is to protect the depositing public in

the event of a bank closure (PDIC v. Citibank, N.A., 669 SCRA
191, 11 April 2012).

They act as insurer, as a co- regulator of banks, and as

receiver and liquidator of closed banks (PDIC v. Phil.
Countryside Rural Bank, INC. 640 SCRA 322, 24 January 2011).
WHAT IS PDIC MAXIMUM DEPOSIT
INSURANCE COVERAGE
THE MAXIMUM DEPOSIT INSURANCE COVERAGE IS P500,000
PER DEPOSITOR. ALL DEPOSIT ACCOUNTS BY A DEPOSITOR IN
A CLOSED BANK MAINTAINED IN THE SAME RIGHT AND
CAPACITY SHALL BE ADDED TOGETHER.

UNDER R.A. NO. 9576, THE PDIC MAY PROPOSE TO ADJUST THE
MDIC, SUBJECT TO THE APPROVAL OF THE PRESIDENT OF THE
PHILIPPINES, IN CASE OF A CONDITION THAT THREATENS THE
MONETARY AND FINANCIAL STABILITY OF THE BANKING
SYSTEM THAT MAY HAVE SYSTEMIC CONSEQUENCES.
SHALL THE DEPOSITOR PAY ANY
INSURANCE PREMIUM TO PDIC?

NO. INSURANCE PREMIUM IS PAID BY THE BANKS, NOT BY THE

DEPOSITORS. THE BANK IS ASSESSED 1/5 OF 1% PER ANNUM
OF THE ASSESSMENT BASE OF THE BANK.
WHAT BANKS ARE
UNDER THE PDIC LAW?

All banks. It is mandatory for banks to insure their deposits

with, and pay premium to, the PDIC.

commercial banks, savings banks, mortgage banks, rural

banks, development banks, cooperative banks, stock savings
and loan associations and branches and agencies in the
Philippines of foreign banks and all other corporations
authorized to perform banking functions in the Philippines.
WHAT SPECIFIC RISK TO A BANK
PDIC COVER?

PDIC COVERS ONLY THE RISK OF A BANK CLOSURE ORDERED

BY THE MONETARY BOARD. THUS, BANK LOSSES DUE TO
THEFT, FIRE, CLOSURE BY REASON OF STRIKE OR EXISTENCE
OF PUBLIC DISORDER, REVOLUTION OR CIVIL WAR, ARE NOT
COVERED BY PDIC.
WHAT IS INSURED DEPOSIT?

The term 'insured deposit' means the amount due to any bona
fide depositor for legitimate deposits in an insured bank net of
any obligation of the depositor to the insured bank as of date of
closure, but not to exceed P500,000.00.

A joint account shall be insured separately from any individually-

owned deposit account.
WHAT ARE THE TYPES OF
DEPOSITS THAT ARE INSURED?

Savings account, current account, time deposits. Deposits in

acceptable foreign currencies are also insured pursuant to
the Foreign Currency Deposit Act of the Philippines ( R . A .
6426).
WHAT ARE THE TYPES OF
DEPOSITS THAT ARE NOT INSURED?
R.A. No. 9576 stipulates that PDIC will not pay deposit insurance
for the following accounts or transactions:
Investment products such as bonds, securities and trust
accounts;
Deposit accounts which are unfunded, fictitious or
fraudulent;
Deposit products constituting or emanating from unsafe and
unsound banking practices;
Deposits that are determined to be proceeds of an unlawful
activity as defined under the Anti-Money Laundering Law.
PAYMENT OF INSURED DEPOSITS.
(1) by cash, or
(2) by making available to each depositor a transferred deposit
in another insured bank

PERIOD TO CLAIM INSURED DEPOSITS

within two (2) years from actual takeover of the closed bank
HOW DO WE TREAT JOINT ACCOUNTS
IN DETERMINING THE AMOUNT DUE?

The maximum insured deposit shall be divided into as many

equal shares as there are individuals, juridical persons or
entities, unless a different sharing is stipulated in the
document of deposit.
BOUNCING
CHECKS
AN ACT PENALIZING THE MAKING
OR DRAWING AND ISSUANCE OF A
CHECK WITHOUT SUFFICIENT
FUNDS OR CREDIT AND FOR
OTHER PURPOSES.
 CHECKS

Check is a bill of exchange issued by a drawer ordering the

drawee bank to pay the payee named in the check a certain
amount either payable to bearer or order. It is a substitute for
money to pay an obligation incurred.
WHY DO CHECKS BOUNCES?

Insufficient funds
No funds
The account has been closed
"SECTION I. CHECKS WITHOUT
SUFFICIENT FUNDS

Any person who makes or draws and issues any check to apply on
account or for value, knowing at the time of issue that he does not
have sufficient funds in or credit with the drawee bank for the
payment of such check in full upon its presentment, which check is
subsequently dishonored by the drawee bank for insufficiency of
funds or credit or would have been dishonored for the same reason
had not the drawer
PUNISHMENT OF CHECKS WITHOUT
SUFFICIENT FUNDS

Imprisonment of not less than thirty days but not more than one
(1) year
Or by a fine of not less than but not more than double the
amount of the check which fine shall in no case exceed Two
Hundred Thousand Pesos,
Or both at the discretion of the court.
"SECTION 2 EVIDENCE OF
KNOWLEDGE OF INSUFFICIENT FUNDS
The making, drawing and issuance of a check payment of which is refused by
the drawee because of insufficient funds in or credit with such bank, when
presented within ninety (90) days from the date of the check, shall be
prima facie evidence of knowledge of such insufficiency of funds or
credit unless such maker or drawer pays the holder thereof the amount due
thereon, or makes arrangements for payment in full by the drawee of such
check within (5) banking days after receiving notice that such check has not
been paid by the drawee.

Notice of dishonor - drawer need to pay drawee within (5) banking days
after receiving notice that such check has not been paid by the drawee.
*With the absence of demand letter or notice of dishonor, the case will be
dismissed.
SECTION 3 WHAT IS THE DUTY OF DRAWEE

Section 3. It shall be the duty of the drawee of any check, when refusing to
pay the same to the holder thereof upon presentment, to cause to be
written, printed, or stamped in plain language thereon, or attached
thereto, the reason for drawee's dishonor or refusal to pay the same:
Provided, That where there are no sufficient funds in or credit with such
drawee bank, such fact shall always be explicitly stated in the notice of
dishonor or refusal.
SECRECY
OF BANK
DEPOSITS
SECRECY OF BANK DEPOSITS

REPUBLIC ACT NO, 1405

AN ACT PROHIBITING DISCLOSURE OF OR INQUIRY INTO,

DEPOSITS WITH ANY BANKING INSTITUTIONS AND
PROVIDING PENALTY THEREFOR

Amended by:
PD 1792 - January 16, 1981

Further Amended by:

RA7653 - June 14, 1993
WHAT IS THE PURPOSE OF
RA 1405?

To give encouragement to the people to deposit their

money in banking institutions

To discourage private hoarding so that the same may be

properly utilized by banks in authorized loans to assist in
the development of the country
WHAT IS PROHIBITED UNDER THE
BANK SECRECY LAW

Any person, government official, bureau or office that,

examines, inquires or looks into a bank deposit or government
bond investment in any of the instances not allowed in Section 2

Any official or employee of a banking institution may not disclose

to any person of any information concerning said deposits
SECTION 2

All deposits of whatever nature with banks or banking institutions in the

Philippines including investments in bonds issued by the Government of the
Philippines, its political subdivisions and its instrumentalities, are hereby
considered as of an absolutely confidential nature and may not be examined,
inquired or looked into by any person, government official, bureau or office,
except upon written permission of the depositor, r in cases of impeachment,
or upon order of a competent court in cases of bribery or dereliction of duty
of public officials, or in cases where the money deposited or invested is the
subject matter of the litigation
 DEPOSITS COVERED
General Rule:
All deposits of whatever nature with banks or banking institutions found in the
Philippines
Investments in bonds issued by the Philippine government, its branches and
institutions

Trust Funds
The money deposited under the trust agreement is intended not merely to
remain with the bank but to be invested by it elsewhere

Foreign Currency Deposit

Foreign currency deposits are governed by a different law which is the Foreign
Currency Deposits Act (RA 6426)
EXCEPTIONS:

the following are the exceptions to the bank secrecy law:

1) When there is written permission of the depositor or

investor;
2) Impeachment cases;
3) Upon the order of a competent court in cases of bribery or
dereliction of duty of public officials;
4) Upon the order of a competent court in cases where the
money deposited or invested is the subject of litigation;
5) Upon order of the competent court or tribunal in cases
involving unexplained wealth under the Anti-Graft and
Corrupt Practices Act, R.A. No. 3019

5
EXCEPTIONS:
the following are the exceptions to the bank secrecy law:

6) Upon inquiry by the Commissioner of Internal Revenue for

the purpose of determining the net estate of a deceased
depositor;
7) Upon the order of a competent court or in proper cases by
the Anti-Money Laundering Council where there is probable
cause of money laundering and in some instance even without
court order
8) Disclosure to the treasurer of the Philippines for dormant
deposits for at least ten (10) years under the Unclaimed
Balances Act)
9) Report of banks to Anti-Money Laundering Council (AMLC)
of covered and/or suspicious transactions
10) Upon order of the Court of Appeals, examination by law
enforcement officers in terrorism cases under the Human
Security Act of 2007 5
DOES GARNISHMENT OF BANK DEPOSIT
VIOLATE THE BANK SECRECY LAW?

No, the prohibition against examination does not preclude

its being garnished for satisfaction of judgment. The
disclosure is purely incidental to the execution process and
it was not the intention of the legislature to place bank
deposits beyond the reach of judgment creditor.

2
TRUTH IN LENDING

AN ACT TO REQUIRE THE DISCLOSURE OF FINANCE CHARGES IN CONNECTION

WITH EXTENSIONS OF CREDIT

It is hereby declared to be the policy of the State to protect its citizens from a
lack of awareness of the true cost of credit to the user by assuring a full
disclosure of such cost with a view of preventing the uninformed use of credit
to the detriment of the national economy.

3
CREDIT MEANS

any loan, mortgage, deed of trust, advance or

discount

any conditional sales contract

any contract to sell, or sale or contract of sale of

property or services, either for present or future
delivery, under which part or all of the price is
payable subsequent to the making of such sale or
contract

any rental-purchase contract

5
“Finance charge” includes interest, fees, service charges,
discounts and such other charges incident to the
extensions of credit as the Board may be regulation
prescribe

“Creditor” means any person engaged in the business of

extending credit who requires as an incident to the
extension of credit, the payment of a finance charge.

“Person” means any individual, corporation, partnership,

association, or other organized group of persons, or the
legal successor or representative of the foregoing, and
includes the Philippine Government or any agency

5
WHAT ARE THE INFORMATION
REQUIRED TO BE FURNISHED TO THE
DEBTOR OR BORROWER?

Section 4 of the law, any creditor shall furnish to each

person to whom credit is extended, prior to the
consummation of the transaction, a clear statement in
writing setting forth, to the extent applicable and in
accordance with rules and regulation prescribed by the
Board, the following information:

2
the cash price or delivered price of the property or service
to be acquired
the amounts, if any, to be credited as down payment and/or
trade-in;
the difference between the amounts set forth under clauses
(1) and (2);
the charges, individually itemized, which are paid or to be
paid by such person in connection with the transaction but
which are not incident to the extension of credit;
the total amount to be financed;
the finance charge expressed in terms of pesos and
centavos; and
the percentage that the finance bears to the total amount
to be financed expressed as a simple annual rate on the
outstanding unpaid balance of the obligation.
2
When and how should these information to be
furnished to the debtor or borrower?

the information numerated above must be disclosed to the

debtor or borrower prior to the consumption of the transaction.
the information must be clearly stated in writing

What is the effect on the obligation in case of

violations to the Truth in Lending Act

the contract or transaction remains valid or enforceable,

subject to the penalties

2
WHAT ARE THE PENALTIES IN CASE OF
VIOLATION

Section 6. Any creditor who in connection with any credit

transaction fails to disclose to any information in violation of
this Act or any regulation issued thereunder shall be liable to
such person in the amount of P100 or in amount equal to twice
the finance charge required by such creditor in connection with
such transaction, whichever is the greater, except that such
liability shall not exceed P2000 on any credit transaction

2
OTHER CONSIDERED VIOLATION OF
THE LAW.

Escalation Clause. Truth in Lending Act may also be violated if the

agreement provides for an escalation clause on interest which is
dependent solely on the will of the bank (UCPB v. Spouses Beluso,
ibid.).

Example:
the following provision is void; “The interest shall be at the rate
indicative of (the bank’s) retail rate or as determined by the Branch
Head of the Bank.”

2
OTHER CONSIDERED VIOLATION OF
THE LAW.

Subsequent compliance. Subsequent compliance with the

disclosure requirement cannot be deemed in substantial
compliance with the Truth in Lending Act (UCPB v. Spouses Beluso,
ibid.).

Example:
The bank gave the details when only when demand for payment
was being made.

2
ANTI-MONEY
LAUNDERING
ACT
AN ACT AMENDING REPUBLIC ACT
NO. 9160, OTHERWISE KNOWN AS
THE "ANTI-MONEY LAUNDERING
ACT OF 2001
ANTI-MONEY LAUNDERING ACT

It is hereby declared the policy of the State to protect and

preserve the integrity and confidentiality of bank accounts and
to ensure that the Philippines shall not be used as a money
laundering site for the proceeds of any unlawful activity.
Consistent with its foreign policy, the State shall extend
cooperation in transnational investigations and prosecutions of
persons involved in money laundering activities wherever
committed.
MONEY LAUNDERING

The act of transferring the monetary proceeds derived from illicit activities
into funds with an apparently legal source.

Laundering: used to describe investment or other transfer of money

flowing from racketeering, drug transactions, and other illegal sources into
legitimate channels so that its original source cannot be traced.
“COVERED PERSONS”
UNDER THE AMLA

SECTION 1. Section 3(a) of Republic Act No. 9160

(a) Covered persons', natural or juridical refer to:

(1) banks, non-banks, quasi-banks, trust entities, foreign exchange dealers,

pawnshops, money changers, remittance and transfer companies and
other similar entities and all other persons and their subsidiaries and
affiliates supervised or regulated by the Bangko Sentral ng Pilipinas (BSP);

(2) insurance companies, pre-need companies and all other persons

supervised or regulated by the Insurance Commission (IC);
"(3) (i) securities dealers, brokers, salesmen, investment houses and other similar persons
managing securities or rendering services as investment agent, advisor, or consultant, (ii)
mutual funds, close-end investment companies, common trust funds, and other similar
persons, and (iii) 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 (SEC);

"(4) jewelry dealers in precious metals, who, as a business, trade in precious metals, for
transactions in excess of One million pesos (P1,000,000.00);

"(5) jewelry dealers in precious stones, who, as a business, trade in precious stones, for
transactions in excess of One million pesos (P1,000,000.00);

("(6) company service providers which, as a business, provide any of the following services to
third parties: (i) acting as a formation agent of juridical persons; (ii) acting as (or arranging
for another person to act as) a director or corporate secretary of a company, a partner
of a partnership, or a similar position in relation to other juridical persons; (iii) providing a
registered office, business address or accommodation, correspondence or administrative
address for a company, a partnership or any other legal person or arrangement; and (iv)
acting as (or arranging for another person to act as) a nominee shareholder for another
person; and
"(7) persons who provide any of the following services:
(i) managing of client money, securities or other assets;
(ii) management of bank, savings or securities accounts;
(iii) organization of contributions for the creation, operation
or management of companies; and
(iv) creation, operation or management of juridical persons or
arrangements, and buying and selling business entities.

"(9) Real estate developers and brokers;

"(10) Offshore gaming operation, as well as their service

providers, supervised, accredited or regulated by the
Philippine Amusement and Gaming Corporation (PAGCOR) or
any government agency;
 SEC. 2. SECTION 3(I)
UNLAWFUL ACTIVITY
UNDER AMLA

'
“(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
"(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 AND
PRESIDENTIAL DECREE NO. 532;
"(8) QUALIFIED THEFT UNDER ARTICLE 310 OF THE REVISED PENAL CODE, AS AMENDED;
"(9) SWINDLING UNDER ARTICLE 315 AND OTHER FORMS OF SWINDLING UNDER ARTICLE 316 OF
THE REVISED PENAL CODE, AS AMENDED;
"(10) SMUGGLING UNDER REPUBLIC ACT NOS. 455 AND 1937;
"(11) VIOLATIONS OF 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 SECTIONS 3 AND 4 OF REPUBLIC ACT NO. 9372;
"(14) FINANCING OF TERRORISM UNDER SECTION 4 AND OFFENSES PUNISHABLE UNDER
SECTIONS 5, 6, 7 AND 8 OF REPUBLIC ACT NO. 10168, OTHERWISE KNOWN AS THE TERRORISM
FINANCING PREVENTION AND SUPPRESSION ACT OF 2012:
"(15) BRIBERY UNDER ARTICLES 210, 211 AND 211-A OF THE REVISED PENAL CODE, AS AMENDED,
AND 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 AND
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, 169 AND 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 78 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 PROTECTION ACT;
"(25) VIOLATION OF REPUBLIC ACT NO. 6539, OTHERWISE KNOWN AS THE ANTI-CARNAPPING
ACT OF 2002, AS AMENDED;
"(26) VIOLATIONS OF SECTIONS 1, 3 AND 5 OF PRESIDENTIAL DECREE NO. 1866, AS AMENDED,
OTHERWISE KNOWN AS THE DECREE CODIFYING THE LAWS ON ILLEGAL/UNLAWFUL
POSSESSION, MANUFACTURE, DEALING IN, ACQUISITION OR DISPOSITION OF FIREARMS,
AMMUNITION OR EXPLOSIVES;
"(27) VIOLATION OF PRESIDENTIAL DECREE NO. 1612, OTHERWISE KNOWN AS THE ANTI-
FENCING LAW;
"(28) VIOLATION OF SECTION 6 OF REPUBLIC ACT NO. 8042, OTHERWISE KNOWN AS THE
MIGRANT WORKERS AND OVERSEAS FILIPINOS ACT OF 1995, AS AMENDED BY REPUBLIC ACT
NO. 10022;
"(29) VIOLATION OF REPUBLIC ACT NO. 8293, OTHERWISE KNOWN AS THE INTELLECTUAL
PROPERTY CODE OF THE PHILIPPINES;
"(30) VIOLATION OF SECTION 4 OF REPUBLIC ACT NO. 9995, OTHERWISE KNOWN AS THE ANTI-
PHOTO AND VIDEO VOYEURISM ACT OF 2009;
"(31) VIOLATION OF SECTION 4 OF REPUBLIC ACT NO. 9775, OTHERWISE KNOWN AS THE ANTI-
CHILD PORNOGRAPHY ACT OF 2009;
"(32) VIOLATIONS OF SECTIONS 5, 7, 8, 9, 10(C), (D) AND (E), 11, 12 AND 14 OF REPUBLIC ACT NO.
7610, OTHERWISE KNOWN AS THE SPECIAL PROTECTION OF CHILDREN AGAINST ABUSE,
EXPLOITATION AND DISCRIMINATION;
"(33) FRAUDULENT PRACTICE AND OTHER VIOLATIONS UNDER REPUBLIC ACTR NO. 8799,
OTHERWISE KNOWN AS "THE SECURITIES REGULATION CODE OF 2000;
"(34) VIOLATION OF SECTION 9 (A)(3) OF REPUBLIC ACT NO. 10697, OTHERWISE KNOWN AS THE
"STRATEGIC TRADE MANAGEMENT ACT", IN RELATION TO THE PROLIFERATION OF WEAPONS
OF MASS DESTRUCTION AND ITS FINANCING PURSUANT TO UNITED NATIONS SECURITY
COUNCIL RESOLUTION NUMBERS 1718 OF 2006 AND 2231 OF 2015";
"(35) VIOLATION OF SECTION 254 OF CHAPTER II, TITLE X OF THE NATIONAL INTERNAL REVENUE
CODE OF 1997, AS AMENDED,
"(36) FELONIES AND OFFENSES OF A SIMILAR NATURE THAT ARE PUNISHABLE UNDER THE PENAL
LAWS OF OTHER COUNTRIES.
 “SEC. 4. MONEY
LAUNDERING
OFFENSE
Money laundering is a crime whereby the proceeds of an unlawful activity as
herein defined are transacted, theby making them appear to have
originated from legitimate sources. It is committed by the following:

any person who, knowing that any monetary instrument or property

represents, involves, or relates to the proceeds of any unlawful activity
any covered person who, knowing that a covered or suspicious
transaction is required under this Act to be reported to the Anti-Money
Laundering Council (AMLC), fails to do so.
“COVERED
TRANSACTION” UNDER
THE AMLA

SECTION 1. Section 3, paragraph (b), of Republic Act No. 9160 is hereby

amended as follows:
“(b) ‘Covered transaction’ is a transaction in cash or other equivalent
monetary instrument involving a total amount in excess of Five hundred
thousand pesos (P500,000.00) within one (1) banking day.”
SECTION 2. SECTION 3 OF THE SAME ACT:
“SUSPICIOUS TRANSACTION”
'Suspicious transactions' are transactions with covered persons, regardless of the amounts
involved, where any of the following circumstances exist:
"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 Act
"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 an unlawful activity or offense under this Act
that is about to be, is being or has been committed; or
"7. Any transaction that is similar or analogous to any of the foregoing.
SECTION 6. SECTION 9 OF THE SAME
ACT IS HEREBY AMENDED TO READ
AS FOLLOWS:

“SEC. 9. PREVENTION OF MONEY

LAUNDERING
CUSTOMER IDENTIFICATION

RECORD KEEPING

REPORTING OF COVERED AND SUSPICIOUS

TRANSACTIONS
"MONETARY INSTRUMENT" REFERS
TO:
(1) coins or currency of legal tender of
the Philippines, or of any other country;
(2) drafts, checks and notes;
SECTION 7. SECTION 10 OF THE SAME
ACT IS HEREBY 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(I) HEREOF,
MAY ISSUE A FREEZE ORDER WHICH SHALL BE EFFECTIVE
IMMEDIATELY. THE FREEZE ORDER SHALL BE FOR A PERIOD OF TWENTY
(20) DAYS UNLESS EXTENDED BY THE COURT.
WHAT IS THE PERIOD OF
EFFECTIVITY OF A FREEZE ORDER?

THE COURT OF APPEALS MAY ISSUE A FREEZE ORDER WHICH

SHALL BE EFFECTIVE IMMEDIATELY, AND WHICH SHALL NOT
EXCEED SIX (6) MONTHS DEPENDING UPON THE
CIRCUMSTANCES OF THE CASE: PROVIDED, THAT IF THERE IS NO
CASE FILED AGAINST A PERSON WHOSE ACCOUNT HAS BEEN
FROZEN WITHIN THE PERIOD DETERMINED BY THE COURT, THE
FREEZE ORDER SHALL BE DEEMED IPSO FACTO LIFTED:
SECTION 9. Section 14, paragraphs
(c) and (d) of the same Act is hereby
amended to read as follows:

“SEC. 14. Penal Provisions.

(a) Penalties for the Crime of Money Laundering
(b) Penalties for Failure to Keep Records
(c) Malicious Reporting
(d) Breach of Confidentiality
Thank You!