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Tuesday, February 15, 2005
BSP to money changers, remit agents: Register
TO strengthen its fight against money laundering, the Bangko Sentral ng Pilipinas (BSP) is now requiring foreign exchange dealers (FXD), also known as money changers (MC), and remittance agents (RA) to register with the BSP before they can operate as such.
“FXDs/MCs and RAs existing prior to the effectivity of the regulation may still continue to operate, provided that an application for registration has been filed with the BSP within 90 calendar days from the effectivity date of the circular,” the central bank said.
Circular 471 was issued last Jan. 24.
Lorenzo Zafico, deputy director of the Bangko Sentral ng Pilipinas-Cebu Regional Office, said those dealing in foreign exchange were originally required to register with the BSP, which is why dealers often posted a notice in their place of business, indicating they were a “foreign exchange dealer authorized by the BSP.”
But when foreign exchange transactions were liberalized, a circular was issued requiring just a mayor’s permit for such establishments, Zafico told Sun.Star.
The latest circular, therefore, is just a return to the old practice of registering such businesses with the BSP, he said.
Suspicious
The new regulation also requires FXDs/MCs and RAs to comply with Republic Act 9160 or the Anti-Money Laundering Law of 2001, which provides for the reporting of suspicious and covered transactions, and record-keeping requirements.
This means that both sellers and buyers of foreign currencies will have to fill out and sign an application form and present government-issued identification documents, such as Social Security System/Government Service and Insurance System/voter’s ID, driver’s license or passport, among others.
Asked for her reaction to the new circular, Jenny-Vi Cortes, Cebu branch manager of eBusiness Services Inc. (eBiz), a direct agent of money transfer firm Western Union, said eBiz currently has maximum limits in place for sending remittances.
For instance, the maximum allowable remittance from the Philippines to the United States is $7,500 per day per person. But whenever a remittance reaches this amount, eBiz will still have to ask Western Union International in Australia whether it will approve the sending of such an amount.
Western Union International will make a decision based on the scanned documents that eBiz sends on the remittance, like the origin of the money, “where it’s from, like from the sale of property,” and the intended recipient, among others, Cortes said.
Birthday
The new circular, however, prescribes the minimum amount of information to be asked from senders of money to include personal information, like the date and place of birth, nationality and name of and relationship with beneficiary.
Cortes said if remittance firms currently don’t require this information, then they may have to spend to print new forms.
The BSP defines foreign exchange dealers and money changers as those engaged in the business of buying and/or selling foreign currencies, while remittance agents are those remitting, transferring or transmitting money on behalf of any person to another person and/or entity. These include money couriers, money transfer agents and remittance firms.
According to the circular, these entities must report to the Anti-Money Laundering Council any transaction by a client involving at least P500,000 in a single banking day. But in the case of suspicious transactions, whatever the amount may be, they must be reported.
A transaction is considered suspicious if there is no legal or trade purpose or economic justification for it, and if the amount involved is not commensurate to the financial capacity of the client, the circular said.
Last week, President Arroyo said the country had been delisted from the Paris-based Financial Action Task Force’s list of non-cooperative countries in the global effort against money laundering. (CTL)
(February 15, 2005 issue)
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