MANILA – A series of deposits made by the Commission on Elections (Comelec) chairman and the amount of money on his numerous accounts at the Luzon Development Bank (LDB) should have raised a red flag, Sen. Grace Poe said Wednesday as the Senate Banks committee opened hearings on possible violations of the Anti-Money Laundering Act.
“It is my position that they [LDB] should have reported anything that seemed out of the ordinary. A succession of deposits consistently done every other day or within a certain pattern, exceeding hundreds of millions—this should have raised a red flag,” Poe stressed.
Earlier reports said that Comelec Chair Bautista has 35 separate accounts totalling P329 million with the LDB, a Laguna-based thrift bank, which has assets reaching some P6 million as of last March.
His estranged wife Patricia earlier claimed that there were almost daily deposits to his bank accounts which were always below the P500,000 threshold, allegedly done to avoid the provision in the Anti-Money Laundering Council (AMLC) requiring banks to post transaction reports beyond that amount.
Under the AMLC rules, banks and other financial institutions covered by the anti-money laundering law are required to flag transactions in cash or other equivalent monetary instrument exceeding P500,000 five to 15 days from occurrence.
Poe said, “Akalain mong kahit ubod ng yaman ng isang tao, hawak nya ang pera ng kanyang pamilya, siya pa naman ang nasa gobyerno, siya pa naman ang pinagkatiwalaan, ilalagay nya sa isang bangko na katulad sa inyo na ‘di naman ganun kalaki. Hindi rin naman kami mapagbibintangan na mag-iisip kami na mayroong hindi nararapat dito at hindi naaayon [Can you imagine someone with so much money, and is entrusted with the family assets, and he’s from government and he’s the trusted one–why would he place such huge sums in a bank that is not so big? You can’t fault us for suspecting that something is not right about this], Poe told bank officials at the hearing chaired by Sen. Francis “Chiz” Escudero.”
Bautista had said that most of his assets belong to his sister, brother and parents.
LDB president David Sarmiento told senators that the bank has submitted suspicious transaction reports but that it cannot just yet divulge information.
Poe said, “Just to make it clear, LDB supposedly said they are compliant, but this is my position, that minimum compliance doesn’t necessarily mean they have done everything that they could to prevent money laundering or a violation of our rule.”
Poe moved that the Comelec chair be summoned to the next committee hearing, which was approved by committee chairman Escudero.
“It’s but right that if we are to have a second heating, that the subject of our inquiry, the depositor himself, is invited here. I don’t know if some of these are closed accounts. It is his chance to explain his side and let us know which assets are his and not his. He has claimed that all of them come from legitimate sources of his family. It’s his chance to prove this, assuming this committee invites him,” Poe said, speaking mostly in Filipino.
Politically exposed persons
In the same hearing, Escudero and Poe took to task the LDB officials for their seemingly cavalier attitude to the AMLA provision on handling clients who are deemed “politically exposed persons” – the phrase meant for those who are in government and hold influential positions and could be vulnerable to corruption or suspicion of wrongdoing by virtue of theor responsibility or mandate.
The senators had wondered why Bautista, obviously a “PEP” by virtue of being Comelec chairman, did not seem to have been flagged by the bank.
Poe asked officials of the Anti-money Laundering Council (AMLC) to explain the background of the PEP provision. The AMLC said the “politically exposed persons” category was imposed by the Paris-based watchdog Financial Action Task Force in order to identify the covered persons among their clients.
Poe also sought a clarification of the “Know Your Customer (KYC)” policy imposed on banks by regulators.
She wanted to know whether banks could rerquire a client it is not so familiar with, and it knows to be in government service, to present a copy of his SALN.
This depends, said AMLC, on the “risk profile of the bank. One minimum information sought by the bank is the source of funds of the depositor, in order to justify the level of transactions.