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“Combating the Financing of Terrorism: The Philippine Experience and Perspectives” National Seminar on Formulating Prevention and Suppression of the Financing.

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Presentation on theme: "“Combating the Financing of Terrorism: The Philippine Experience and Perspectives” National Seminar on Formulating Prevention and Suppression of the Financing."— Presentation transcript:

1 “Combating the Financing of Terrorism: The Philippine Experience and Perspectives” National Seminar on Formulating Prevention and Suppression of the Financing of Terrorism Act: Perspectives from International and Thai Law Enforcement and Prosecution Bangkok, Thailand 27 July 2012 JULIA C. BACAY-ABAD Deputy Director Anti-Money Laundering Council Philippines

2 OUTLINE I. Introduction: Challenges faced by the Philippines from 2008 to 2012 a Mutual Evaluation/Assessment by World Bank and APG b. FATF Public Statement on the Philippines (October 2010 – February 2012) February 2012) c. Legislative Actions Taken Towards Criminalization of TF II. Republic Act No a. Salient Features b. Definition of TF and other Punishable Acts c. Powers of the AMLC under R.A d. Freeze Order under R.A e. Extra-Territorial Application of R.A III. Success Stories: Freezing & Forfeiture of Terrorism-related Assets a. International Islamic Relief Organization (IIRO) b. Rajah Solaiman Movement (RSM) IV. Present Challenges

3 Past Challenges 22 Sept – 6 October Philippines’ AML/CFT Regime underwent mutual evaluation/assessment jointly by the World Bank and APG. 8 July 2009 – Mutual Evaluation Report on the Philippines was adopted by the APG in its Plenary Meeting, with 13 * partially compliant (PC)/non-compliant (NC) ratings. (*Out of 16 Key & Core FATF Recommendations)

4 Past Challenges As a result, the FATF’s International Cooperation Review Group (ICRG) conducted a prima facie review of the Philippines’ AML/CFT Regime and placed the Philippines in a “pool of vulnerable” jurisdictions, along with Pakistan, Sri Lanka, Myanmar, Nepal, Bangladesh and Vietnam, among others.

5 Past Challenges June – Sept ICRG conducted a targeted review of the Philippines and laid down an Action Plan, requiring it to enact, on or before 31 December 2011, a law amending the AMLA and another law criminalizing TF.

6 Past Challenges 5 July House Bill (HB) No entitled “An Act Defining Terrorist Financing and Providing Penalties Therefor” was filed with the House of Representatives (lower house). 4 August 2010 – a second bill (HB No. 2158) was filed with the lower house.

7 Past Challenges October Philippines was placed in the “Grey List” by the Financial Action Task Force (FATF); identified to be among the jurisdictions which have strategic AML/CFT deficiencies, and was required to, among others: (1) Adequately criminalize money laundering and terrorist financing; (2) Implement adequate procedures to identify and freeze terrorist assets and confiscate funds related to money laundering.

8 Past Challenges February 2011/June 2011 – Philippines remained in the FATF’s Public Statement, with a warning that if the Action Plan remains unheeded, the FATF will call upon its members to take countermeasures against the Philippines (“blacklisting”). 3 August 2011 – Substitute bill (HB No. 5015) was filed with the lower house.

9 Past Challenges 27 October the President of the Philippines certified HB No as “urgent”.

10 Past Challenges 7 Feb – The Lower House (House of Representatives) approved HB No. 5015

11 Past Challenges Meanwhile… 7 Feb – The Upper House (Senate) filed Senate Bill (SB) No entitled “An Act Defining Terrorist Financing as a Crime and Providing Penalties Therefor” 16 Feb – Substitute bill was filed with the Senate (SB No. 3127)

12 Past Challenges December 2011 – May Impeachment trial conducted by the Senate against the Supreme Court Chief Justice; - greatly hampered Senate’s deliberation on SB No greatly hampered Senate’s deliberation on SB No

13 Past Challenges Feb – FATF downgraded the Philippines from “Grey List” to the “Dark Grey List” for failure to enact the AMLA Amendments and TF Law; - possibility of being “blacklisted”; deadline until June possibility of being “blacklisted”; deadline until June 2012

14 Past Challenges 5 June the President of the Philippines certified SB No as “urgent”. 6 June 2012 – the Joint Bicameral Conference Committee of the Senate and the House of Representatives approved the TF Law, as well as the Amendment to the AMLA.

15 Past Challenges 18 June the President signed the two (2) approved Bills into law: 1. Republic Act No – “An Act to Further Strengthen the Anti-Money Laundering Act (AMLA)” 1. Republic Act No – “An Act to Further Strengthen the Anti-Money Laundering Act (AMLA)” 2. Republic Act No – “The Terrorism Financing Prevention and Suppression Act of 2012” 2. Republic Act No – “The Terrorism Financing Prevention and Suppression Act of 2012”

16 Partial Relief… June FATF Plenary Meeting in Rome, Italy - Philippines was upgraded to “Grey List” - Philippines was upgraded to “Grey List”

17 Philippines averted blacklist!!!

18 Republic Act No “The Terrorism Financing prevention and Suppression Act of 2012” Signed into law by the President on 18 June 2012 Signed into law by the President on 18 June 2012 Published in newspaper of general circulation on 21 June 2012 Published in newspaper of general circulation on 21 June 2012 Took effect on 6 July 2012 Took effect on 6 July 2012

19 Salient Features of R.A Criminalizes terrorist financing as a stand-alone offence Criminalizes terrorist financing as a stand-alone offence Penalizes mere attempt or conspiracy to commit TF Penalizes mere attempt or conspiracy to commit TF Criminalizes the act of “dealing” with property or funds of designated terrorist individuals, groups, organizations and entities Criminalizes the act of “dealing” with property or funds of designated terrorist individuals, groups, organizations and entities

20 Salient Features of R.A Establishes a freezing mechanism against funds related to terrorist financing or owned by terrorist organizations, groups or individuals whether designated or not; Establishes a freezing mechanism against funds related to terrorist financing or owned by terrorist organizations, groups or individuals whether designated or not; Extends the application of the law beyond the territorial boundaries of the Philippines Extends the application of the law beyond the territorial boundaries of the Philippines

21 Acts punishable under R.A SEC. 4. Financing of Terrorism – Any person who, directly or indirectly, willfully and without lawful excuse, possesses, provides, collects or uses property or funds or makes available property, funds or financial service or other related services, by any means, with the unlawful and willful intention that…

22 Financing of Terrorism (cont’d)… …they should be used or with the knowledge that they are to be used, in full or in part: (a) To carry out or facilitate the commission of any terrorist act; (b) By a terrorist organization, association or group; or (c) By an individual terrorist…

23 Penalty for FT …shall suffer the penalty of reclusion temporal in its maximum period * to reclusion perpetua ** and a fine of not less than P500, nor more than P1,000, (*17 years, 4 months and 1 day to 20 years) (**life imprisonment)

24 Other Acts punishable ActPenalty 1.Organizing or directing others to commit FTSame penalty as FT 2. Dealing with property or funds of Designated Persons, or 3. Making available funds, property or financial services to a Designated Person Same penalty as FT 4. Conspiracy to commit TF or Conspiracy to Deal with property of Designated Persons Same penalty as TF 5. Cooperating in the execution of FT (Accomplice) One degree lower 6. Taking part/profiting from FT or assisting the principal to profit from the effects of the crime, or by concealing or destroying the effects of crime, or by harboring or assisting in the escape of principal (Accessory) Two degrees lower

25 Powers of the Anti-Money Laundering Council (AMLC) under R.A AMLC – Philippines’ FIU; vested with authority to: 1. Conduct investigation on any property or funds that are related to FT 2. Issue ex parte freeze order without delay against: (a) property or funds related to FT or acts of terrorism; (b) property of any person if there is probable cause that the person is committing or attempting, or conspiring to commit, or participating in or facilitating the commission of FT

26 Powers of the Anti-Money Laundering Council (AMLC) under R.A Inquire into or examine bank deposits or investments without a court order 4. Institute forfeiture proceedings against property or funds related to FT

27 Freeze Order under R.A (Sec. 11) - Issued ex-parte by the AMLC - Effective for twenty (20) days - Upon petition filed with the Court of Appeals, may be extended for a maximum period of six (6) months

28 Freeze Order under R.A (Sec. 11) - However, freeze order against property or funds of designated organization, association, group or any individual in compliance with UNSC Resolutions shall be effective until the basis for the issuance thereof shall have been lifted.

29 Extra-Territorial Application of R.A (Sec. 19) Subject to existing treaty, including the International Convention for the Suppression of FT, the criminal provisions of R.A shall apply to any person who, although physically outside the territorial limits of the Philippines: (a) commits, conspires or plots to commit FT inside the territorial limits of the Philippines;

30 Extra-Territorial Application of R.A (Sec. 19) (b) Commits FT on board Philippine ship or Philippine airship; (c) Commits FT within any embassy, consulate, or diplomatic premises of the Philippines; (d) Commits FT against Philippine citizens or persons of Philippine descent, where their citizenship or ethnicity was a factor in the commission of the crime

31 Extra-Territorial Application of R.A (Sec. 19) (e) Commits FT directly against the Philippine government. The provisions of the law shall also apply to a Filipino national who, although outside the territorial jurisdiction of the Philippines, commits, conspires or plots to commit any of the crimes punishable under R.A

32 At present The AMLC, in coordination with other government agencies, is drafting the Implementing Rules of R.A The AMLC, in coordination with other government agencies, is drafting the Implementing Rules of R.A

33 Success Stories Even before the effectivity of R.A …

34 Case 1: The International Islamic Relief Organization (IIRO) The IIRO Philippine branch was listed in the UN Security Council Resolution 1267 consolidated list of persons and entities affiliated with the Al Qaida, the Taliban and Usama Bin Laden. The IIRO Philippine branch was listed in the UN Security Council Resolution 1267 consolidated list of persons and entities affiliated with the Al Qaida, the Taliban and Usama Bin Laden. A certain Jammal Khalifa, a brother-in- law of Usama Bin Laden, worked as the IIRO Philippine branch director and maintained a close relation with Wa’el Hamza Julaidan, a specially designated Global terrorist. A certain Jammal Khalifa, a brother-in- law of Usama Bin Laden, worked as the IIRO Philippine branch director and maintained a close relation with Wa’el Hamza Julaidan, a specially designated Global terrorist.

35 Case 1: IIRO August 2006 – US Government requested the Philippines to check and freeze assets of IIRO-Phil. branch - AMLC investigation showed that IIRO-Phil. was the source of funding for the Al-Qaida Affiliated Abu Sayyaf Group (ASG) - AMLC investigation showed that IIRO-Phil. was the source of funding for the Al-Qaida Affiliated Abu Sayyaf Group (ASG) November 2006 – the AMLC obtained a freeze order against the bank account of IIRO-Phil branch.

36 Case 1: IIRO May AMLC instituted a civil forfeiture proceedings against IIRO’s bank account Feb Order of Forfeiture issued by the Court - Forfeited amount turned over to the National Treasury - Forfeited amount turned over to the National Treasury

37 Case 2: The Rajah Solaiman (“Return to Islam”) Movement [RSM] The RSM is a UNSC designated terrorist group based in the Philippines and with known links to the Jemaah Islamiyah (JI) and the Abu Sayyaf Group (ASG). The RSM is a UNSC designated terrorist group based in the Philippines and with known links to the Jemaah Islamiyah (JI) and the Abu Sayyaf Group (ASG). As early as 2002, the RSM has been receiving financial support from abroad through charitable Non-Governmental Organizations (NGOs). As early as 2002, the RSM has been receiving financial support from abroad through charitable Non-Governmental Organizations (NGOs).

38 Case 2: RSM RSM was responsible for the 2004 Super Ferry attack that killed 116 passengers and for the infamous 2005 Valentine’s Day bombing attacks in three highly urbanized cities resulting in the death of 16 people. RSM was responsible for the 2004 Super Ferry attack that killed 116 passengers and for the infamous 2005 Valentine’s Day bombing attacks in three highly urbanized cities resulting in the death of 16 people. Government operatives were able to capture RSM’s leader and several of his men Government operatives were able to capture RSM’s leader and several of his men

39 Case 2: RSM June US Government requested Philippines for the freezing of assets of RSM - AMLC’s investigation revealed bank account, seven hectare agricultural land, & commercial building being used by members of RSM - AMLC’s investigation revealed bank account, seven hectare agricultural land, & commercial building being used by members of RSM July 2008 – Freeze Order issued against the said assets

40 Case 2: RSM January 2009 – AMLC instituted civil forfeiture proceedings against RSM’s assets Feb Order of Forfeiture issued by the Court. - AMLC is in the process of having the titles to the real properties transferred in the name of the Republic of the Philippines. - AMLC is in the process of having the titles to the real properties transferred in the name of the Republic of the Philippines.

41 Present Challenges  Proper implementation of the TF Law  Enhance AMLC’s capacity to investigate TF cases  Enhance law enforcement’s capacity to prevent, detect & prosecute TF  Additional Resources (financial and technical)

42 “All that is necessary for the triumph of evil is that good men do nothing.” - Edmund Burke

43 Thank you!


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