Author Topic: BSP cancels permits of Philrem, two other firms  (Read 405 times)

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BSP cancels permits of Philrem, two other firms
« on: March 07, 2017, 01:35:00 PM »
BSP cancels permits of Philrem, two other firms
By Joann Santiago
MANILA, June 1 (PNA) - - The Bangko Sentral ng Pilipinas’ (BSP) policy-making Monetary Board (MB) has cancelled the Certificate of Registration of Philrem Services Corp. (Philrem), the remittance service provider that faces lawsuits for alleged involvement in the laundering of about USD 81 million stolen from Bangladesh Bank in February 2016.

The Monetary Board also cancelled the certificate of registration as foreign exchange dealer/money changer/remittance agent of Werquick and Peso Remittance.

The central bank, in a statement Wednesday, said the MB’s decision was made “due to significant violations of Section 4511N of the Manual of Regulations for Non-Bank Financial Institutions and Circular No. 706 dated 5 January 2011.”

The section pertains to registration, application for registration, applicability of other laws/regulations, required seminar/training, sale and purchase of foreign currencies by foreign exchange dealers and money changers, applications to sell/purchase foreign currencies by foreign exchange dealers and money changers, additional requirements, requirements for remittance agents, AMLC reportorial requirements, sanctions and industry associations.

”The BSP will also be working closely with other relevant government agencies, such as the Anti-Money Laundering Council and the Department of Justice, in their investigation of possible criminal and administrative violations under the Anti-Money Laundering Act and its Implementing Rules and Regulations, of the aforementioned entities, including their Directors and Officers,” the central bank added.

Last April, in one of the Senate hearings on the said money laundering activity, BSP Deputy Governor Nestor Espenilla Jr. said there was a possibility that Philrem face sanctions vis-à-vis violations of central bank rules on remittance agents since it failed to implement the know-your-customer (KYC) rule, which is required from BSP-regulated financial institutions .

This after Philrem owner Salud Bautista admitted in one of the Senate hearings that the company did not use the KYC rule on junket operator Kim Wong, who received part of the stolen money, when Philrem remitted money to the businessman.

Instead, Philrem tapped the third party reliance rule hoping that the Jupiter, Makati branch of the Rizal Commercial Banking Corporation (RCBC), where the stolen money was transferred from the Federal Bank of New York ended, followed the KYC rule, she said.

Espenilla said that before a BSP-registered remittance company can use the third party reliance rule they first need to secure a sworn certification that says the bank has conducted the KYC and face-to-face identification, that the bank has the minimum information on the customer, and that the remittance company can secure identification documents from the bank without delay. (PNA)
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