Tuesday, February 21, 2012

News Update BSP launder body audited CJ accounts

MANILA, Philippines - The accounts of Chief Justice Renato Corona with Philippine Savings Bank (PSBank) caught the attention of the anti-money laundering arm of the Bangko Sentral ng Pilipinas (BSP), which included them in an audit in 2010, PSBank president Pascual Garcia III told the Senate impeachment court yesterday.
Garcia made the disclosure on Day 20 of the impeachment trial of Corona, where senators sitting as judges grilled him over the reported leak of the Chief Justice’s bank records. Defense lawyers said the leak could constitute a violation of laws on bank secrecy and compromise the admissibility of the bank records as evidence in the impeachment court.
It was not clear why Corona’s accounts were audited. Garcia also had no idea if it was limited to the peso or dollar accounts of the Chief Justice.
Garcia initially pointed to the Anti-Money Laundering Council (AMLC) as the body that conducted the audit, but this was later corrected.
It was the BSP’s Anti-Money Laundering Specialist Group that audited the bank records for compliance with the Anti-Money Laundering Act (AMLA). The group is under the BSP’s Supervision and Examination Sector. Reliable sources said the audit was conduced by specialist Jerry Leal.
The AMLC, which is separate from the BSP group, can look into bank records only if it has obtained a court order, and only if there is an ongoing investigation by relevant authorities such as the police or the Office of the Ombudsman into any of the predicate crimes covered by the AMLA. The law covers plunder but not bribery or malversation of public funds.
The AMLA requires banks to automatically report to the AMLC any single financial transaction amounting to more than P500,000.
Addressing Garcia, Senate President Juan Ponce Enrile, the presiding officer of the impeachment court, asked about the audit that was conducted in September 2010 on PSBank.
Garcia said the group took sample accounts in its audit and one of the accounts was that of Corona.
“I believe that the AMLC looked at a few accounts, which you classify as accounts that need to be reported, and one of the accounts was from the Katipunan branch,” Garcia said, referring to the account of Corona, before the erroneous reference to the role of the AMLC was corrected.
Garcia said he reviewed the records of the audit and saw that the account of Corona was initially not listed as that of a “politically exposed person” or PEP, a classification that is required by the AMLC for politicians and other related officials in government.
He said the records of Corona in PSBank’s Katipunan branch were among those that had an “exception comment” from the anti-money laundering group, which became the basis for his information regarding the audit.
Garcia said that he had to rely on the records since he was never physically present during those audits.
The 2010 audit, Garcia said, was a regular one, meant to verify if the bank was complying with the processes required under the AMLA, particularly the reportorial requirements for single transactions of P500,000 and above.
Garcia said the bank does not reveal the balances of accounts being looked into but only certain records, including those classified as PEP.
Enrile directed Garcia to bring to the Senate the records of the bank regarding the identity of those who conducted the audit as well as the bank documents that were shown to the group.
Enrile asked if it was possible that what was shown to the audit group were the same documents in the possession of the prosecution panel that were characterized by PSBank Katipunan branch manager Annabelle Tiongson as fake. Garcia replied that the only thing he knew for certain was that the customer identification and signature specimen card of Corona was accessed by the auditing team.
“I believe the nature of comments indicated that they at least saw the specimen signature card or a copy of that. There was a comment that the specimen signature card did not have the classification ‘politically exposed person’ on it,” Garcia said.
Enrile asked Garcia if it was clear that the auditing team actually examined the records of Corona in the bank.
“As far as the signature card is concerned,” Garcia replied.
Apparently the audit turned out well for PSBank because according to Tiongson, the bank even celebrated after the audit was concluded because they received a good rating.
Enrile explained that in asking for the records of the audit, his intention was to cover all the bases in the court’s inquiry into the alleged leak of Corona’s bank documents.
“So that people will not misunderstand, there are many people who handle the records of the respondent Chief Justice in the Katipunan branch. The only thing that is not scrutinized is the document coming from the records of account of the respondent Chief Justice Corona that was submitted to the AMLC and BSP audit team,” Enrile said.
He said the number of individuals with access to the documents was limited, and only these people could have provided the prosecution with the document that was attached to the supplemental request for a subpoena from the Senate.
Enrile said the records of Corona that were provided to the audit team would be compared to the documents attached by the prosecution panel in its supplemental request.
We might be next’
Sen. Joker Arroyo said senator-judges might be the next target of the administration’s probing on records of its perceived enemies.
“An inquiry was conducted. I find it very strange that as far back as September 2010 to November 2010 there was this investigation, then followed by the impeachment that was undertaken at this moment. Then followed by the investigation by the Commissioner of the Bureau of Internal Revenue (BIR). Three investigations against Chief Justice Corona,” Arroyo said.
“I raised this point, that what we worry about is that if those years there are already investigations conducted by the government agencies against us, even among senators,” Arroyo said.
“We worry about that because at the moment we are acting as judges. What we do not know, documents are also gathered against us. This is the impression I gathered from the testimony of the bank president (Garcia) which I would repeat,” he added. “As of now it is Chief Justice Corona, then it will be us tomorrow. If we do not follow Malacañang, they could proceed investigation against us in the information gathered in AMLC. It is a disturbing thought,” he pointed out.
Arroyo also expressed fear that the AMLC might be used by the administration for vested interests.
“This act shall not be used for political prosecution. I am alarmed and I fear that the AMLC may be used for political vendetta,” Arroyo said.
Arroyo cited pending legislative measures before the Senate and the House of Representatives to amend the AMLA.
“Without court intervention they can inquire into bank deposits. Way back in 2003, when AMLA was enacted, the Senate divided the house whether we would relax the power to open bank deposits. The vote was 12-8-1; 12 voted against relaxing; Senators (Edgardo) Angara, (Tessie Aquino) Oreta, Arroyo, (Rodolfo) Biazon, (Gregorio) Honasan, (Loren) Legarda, (Tito) Soto, (Manny) Villar, among others. The principal reason is that it might be used for political vendetta. The president then was Gloria Macapagal-Arroyo,” Arroyo said. With Lawrence Agcaoili, Jose Rodel Clapano - By Marvin Sy

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