Alleged money laundering involving 2 PHL financial institutions not reflective of country’s banking industry – BSP exec

Bangko Sentral ng Pilipinas (Wikipedia photo)

MANILA – The money laundering issue involving a major universal bank and a remittance agency is not reflective of the Philippines’ banking industry, a ranking central bank official said Friday.

Bangko Sentral ng Pilipinas (BSP) Deputy Governor Nestor Espenilla Jr. said the issue currently surrounding Rizal Commercial Banking Corp. (RCBC) and Philrem, institutions where the USD 81 million allegedly stolen from the Bangladesh Bank, the said country’s central bank, was coursed through, is an isolated case.

“This is a concern of particular institutions that may have not been able to fully implement appropriate AML-CFT (anti-money laundering-counter terrorism financing) policies,” he told reporters at the sidelines of the Chamber of Thrift Banks (CTB) convention in Makati City.

Espenilla said the central bank always evaluate BSP-regulated firms based on the latter’s compliance on the Anti-Money Laundering Act (AMLA).

He explained that banks and other central bank-regulated entities were assessed on four areas namely over-all governance and management, the money laundering and terrorist financing prevention program, controls on its policies, and effectiveness of its implementation.

Banks have their own system of governance and management, he said but cited that every bank adopts AML-CFT depending on its business model.

“It cannot be a one size, fits all,” he said.

Espenilla said banks may have their governance standards but they needed to make sure that they were efficiently implementing it.

“You may have policies but you are not fulfilling it then that’s a big problem to BSP,” he quipped.