PHILIPPINE AMUSEMENT AND GAMING CORPORATION

Corporate Office – Malate, New World Manila Bay Hotel

Anti-Money Laundering Compliance Department

FREQUENTLY ASKED QUESTIONS RELATIVE TO ANTI-MONEY

LAUNDERING AND COUNTERING FINANCING TERRORISM

1. What is money laundering?

Money laundering is an act or series or combination of acts whereby proceeds of an

unlawful activity, whether in cash, property or other assets, are converted, concealed or
disguised to make them appear to have originated from legitimate sources. One way of
laundering money is through the financial system.

Republic Act No. 9160, otherwise known as the Anti-Money Laundering Act of 2001
(AMLA), as amended, defined money laundering as a scheme whereby proceeds of an
unlawful activity are transacted or attempted to be transacted, thereby making them
appear to have originated from legitimate sources.

2. What is Terrorism?

The unlawful use of violence and intimidation, especially against civilians in the pursuit of
political aims.

3. What are considered unlawful activities under the AMLA, as amended?

Under RA 10365 there are 34 unlawful activities or predicate crimes covered by the
AMLA. These are, in the order enumerated in the law:

 Kidnapping for ransom

 Drug offenses
 Graft and corrupt practices
 Plunder
 Robbery and extortion
 Jueteng and masiao
 Piracy on the high seas
 Qualified theft
 Swindling
 Smuggling
 Electronic Commerce crimes
  Hijacking, destructive arson and murder, including those perpetrated against
non-combatant persons (terrorist acts)
 Terrorism and conspiracy
 Financing of terrorism
 Bribery
 Frauds and Illegal Exactions and Transactions
 Malversation of public funds and properties
 Forgeries and counterfeiting
 Trafficking for the purpose of exploitation
 Forestry code: Cutting, gathering and/or collecting timber or other products
without license.
 Fishery code: degradation and unrelenting poverty among municipal fishers.
 Illegal mining
 Squandering wildlife resources
 Unprotected use of National caves and caves resources
 Carnapping
 Illegal/Unlawful possession, Manufacture, Dealing in, Acquisition for disposition
of firearms, Ammunition of explosives.
 Fencing
 Violation against Migrant workers and overseas Filipino Act of 1995.
 Violation against intellectual property code
 Photo and video voyeurism
 Children abuse, exploitation and discrimination.
 Child pornography
 Security fraud
 Felonies or offenses of a similar nature punishable under penal laws of other
countries

4. How is money laundered through the financial system?

 Placement- involves initial placement or introduction of the illegal funds into the
financial system. Financial institutions are usually used at this point.

 Layering- involves a series of financial transactions during which the dirty money
is passed through a series of procedures, outing layer upon layer of persons and
financial activities into the laundering process. Ex. Wire transfers, use of shell
corporations, etc.

 Integration- the money is once again made available to the criminal with the
occupational and geographic origin obscured or concealed. The laundered funds
are now integrated back into the legitimate economy through the purchase of
properties, businesses and other investments.
5. Why is Money Laundering a problem?

Money laundering allows criminals to preserve and enjoy the proceeds of their crimes,
thus providing them with the incentives and the means to continue their illegal activities.
At the same time, it provides them the opportunity to appear in public like legitimate
entrepreneurs. Organized crime, through money laundering, is known to have the
capacity to destabilize governments and undermine their financial systems. It is thus a
threat to national security.

6. What is the Anti-Money Laundering Council (AMLC)? What are its powers?

The AMLC is the Philippines’ financial intelligence unit which is tasked to implement the
AMLA. It is composed of the Governor of the Bangko Sentral ng Pilipinas (BSP) as
Chairman & Commissioner of the Insurance Commission (IC) and the chairman of the
Securities and Exchange Commission (SEC) as members.

 Require and receive covered or suspicious transaction reports from Casinos.

 Issue orders to determine the true identity of the owner of any monetary
instrument or property that is the subject of a covered or suspicious transaction
report, and to request the assistance of a foreign country if the Council believes it
is necessary.

 Cause the filing of complaints with the Department of Justice of the Ombudsman
for the prosecution of money laundering offenses.

 Investigate suspicious transactions, covered transactions deemed suspicious,

money laundering activities and other violations of the AMLA.

 Implement such measures as may be necessary and justified to counteract

money laundering

 Enlist the assistance of any branch of government for the prevention, detection
and investigation of money laundering offenses and the prosecution of offenders.
In this connection, the AMLC can require intelligence agencies of the government
to divulge any information that will facilitate the work of the Council in going after
money launderers.

 Impose administrative sanctions on those who violate the law, and the rules,
regulations, orders and resolutions issued in connection with the enforcement of
the law.
7. Why are Casinos required to comply with the Anti-Money Laundering (AMLA)?

Republic Act No. 9160, as amended by Republic Act No. 10927, otherwise known as An
Act Designating Casinos as Covered Person under Republic Act No. 9160, otherwise
known as Anti-Money Laundering Act of 2001.

Section 5. Designation of Casinos as Covered Persons- Casinos, including

internet and ship-based casinos, with respect to their casino cash transactions related to
their gaming operations, and such other entities as may hereafter determined by AGA,
are hereby designated as covered persons under the AMLA.

8. What are the Customers Identification Requirements – KYC (Know Your Customer
Rule)?

Casinos shall:

 Establish and record the true identity of their clients based on official documents.

 In case of corporate clients, require a system verifying their legal existence and
organizational structure, as well as the authority and identification of all persons
purporting to act in their behalf.

 Establish appropriate systems and methods based on internationally compliant

standards and adequate internal controls for verifying and recording the true and
full identity of their customers.

9. What are the Record-Keeping Requirements?

All Casinos shall:

 Maintain and safely store all records of all their transactions for 5 years from the
transaction dates;

 Ensure that said records/files contain the full and true identity of the owners or
holders of the accounts involved in the covered transactions and all other
identification documents;

 Undertake the necessary adequate measures to ensure the confidentiality of

such files;

 Prepare and maintain documentation, in accordance with client identification

requirements, on their customer accounts, relationships and transactions such
 that any account, relationship or transaction can be reconstructed as to enable
the AMLC and/or the courts to establish an audit trail for money laundering;

 Anent closed accounts, preserve and safely store the records on customer
identification, account files and business correspondence for at least 5 years
from the dates they were closed;

 If a money laundering case based on any record kept by the casino has been
filed in court, retain said files until it is confirmed that the case has been finally
resolved or terminated by the court; and

 Retain records as originals in such forms as are admissible in court.

10. What are covered transactions?

It is a single casino cash transaction involving an amount in excess of Five Million Pesos
(₱ 5,000,000.00) or its equivalent in any other currency.

11. What are suspicious transactions?

Transactions, regardless of the amount involved, where the following circumstances

exist:

a. there is no underlying legal or trade obligation, purpose or economic justification;

b. the client is not properly identified;

c. the amount involved is not commensurate with the business or financial capacity
of the client;

d. 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
requirement under the Act;

e. any circumstance relating to the transaction which is observed to deviate from

the profile of the client an/or the client’s past transactions with the covered
institution;

f. 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

g. Any transaction that is similar or analogous to the foregoing.

12. What are the reporting requirements?

Casinos shall report to the AMLC all covered transaction and suspicious transaction
(CTR/STR) within five (5) working days from occurrence thereof, unless the Anti-Money
Laundering Council (AMLC) prescribes a longer period not exceeding ten (10) working
days.

Should a transaction be determine to be both a covered transaction and suspicious

transaction, it shall be reported as suspicious transaction.

13. Are there sanctions for failure to report covered or suspicious transaction and
non-compliance with R.A. 9160, as amended?

Sanctions/penalties shall be imposed on Casino that will fail to comply with theprovision
of R.A. 9160, as amended by R.A. 10927.

14. Are there confidentiality restrictions on the reporting of covered transaction

and/or suspicious transaction?

When reporting covered transaction or suspicious transaction to the AMLC, Casinos and
their officers and employees, are prohibited from communicating, directly or indirectly, in
any manner or by any means, to any person, entity, the media, the fact a covered or
suspicious transaction report was made, the contents thereof, or any other information in
relation thereto. Neither may such reporting be published or aired in any manner or form
by the mass media, electronic mail, or other similar devices. In case of violation thereof,
the concerned officer, and/or employee, of the casinos, or media shall be held criminally
liable.

15. What are the other offenses punishable under the AMLA, as amended?

a. Failure to keep records is committed by any responsible official or employee of

a casinos who fails to maintain and safely store all records of transactions for 5
years from the dates the transaction were made or when the accounts were
closed.

The penalty is 6 months to 1 year imprisonment or a fine of not less than

₱100,000.00 but not more than ₱ 500,000.00, or both.

b. Malicious reporting is committed by any person who, with malice or in bad faith,
reports or files a completely unwarranted or false information regarding a money
laundering transaction against any person.
 The penalty is 6 months to 4 years imprisonment and a fine of not less than
₱100,000.00 but not more than ₱500,000.00. The offender is not entitled to the
benefits of the Probation Law.

c. Breach of Confidentiality. For this offense, the penalty is 3 to 8 years

imprisonment and a fine of not less than ₱500,000.00 but not more than ₱1
Million. In case the prohibited information is reported by media, the responsible
reporter, writer, publisher, manager and editor-in-chief are held criminally liable.

d. Administrative offenses. The AMLC, after due investigation, can impose fines
from ₱100,000.00 to ₱500,000.00 on officers and employees of casinos or any
person who violates the provision of AMLA, as amended, the Implementing
Rules and Regulations, and orders and resolutions issued pursuant thereto.