(PCTC 2nd DRAFT)
11July 2000
Article 1. This law shall be known as the Proceeds of Crime Act of 2000.
Article 2. Declaration of Policy. - It is declared the policy of the State to implement an effective and efficient anti-criminality program so as not to allow these social menace to regroup, reorganize and continue in their nefarious activities by benefiting from the proceeds of their crimes. The government will not allow to have that impression that the Philippines is a financial haven for illegal money and assets.
Article 3. Definitions. – for purposes of this Act, the words and phrases used herein, shall, unless the content indicated otherwise mean and understood to mean as follows:
a) Proceeds of crime – money, assets, or property rights or property which were obtained from the commission of any activity punishable by law, or from supporting or assisting in the commission of any unlawful activities;
- money or assets that were obtained from the sale, distribution or transfer in any manner, whosoever has possession thereof or under whatever ownership the registered evidence exist.
- earnings or interests of the proceeds of crime.
b) Suspicious Transaction – means a transaction that lack economic possibility which can possibly relate to a predicate offense.
c) Transaction – means a performance of a juristic act, contract or other dealings with finance or business.
d) Money Laundering - The conversion or transfer of property knowing that such property is derived from criminal offense, for the purpose of concealing or disguising the illicit origin of the property or assisting any person who is involved in the commission of such offense, or offenses to evade legal consequence of his action; or the concealment or disguise of the true nature, source, location, disposition, movement rights, with respect to or ownership of property, knowing that such property is derived from a criminal offense.
Article 4. Predicate Offenses. – shall mean any activity or act involving the importation manufacture, sale, administration, delivery, distribution and transport of dangerous or prohibited drugs, kidnapping, illegal sale/possession of firearms, ammunition explosives, carnapping, fencing, illegal logging, white slavery, prostitution, illegal recruitment, smuggling, illegal importation, illegal fishing, piracy, illegal gambling, rebellion, murder, homicide, physical injuries, robbery, swindling, counterfeiting, violation of intellectual property right, computer crimes, monopolies and combination in restraint of trade or commerce falsification, securities fraud, mail fraud, bank fraud, dealing in obscene matters, exploitation of children, trafficking in persons, violation under the National Internal Revenue Code, bribery, graft and corrupt practices, and any other offenses punishable under our criminal statutes.
Article 5.
Prohibited Activities:
a.
Whoever,
knowing that the property involved in a financial transaction represents the
proceeds of some form of unlawful activity, conducts or attempts to conduct
such a financial transactions which in fact involves the proceeds of specified
unlawful activity:
i.
with the
intent of promoting the accomplishment
of specified unlawful activity under Article 5 hereof;
ii.
knowing that
the transaction is designed in whole or in part
to conceal or disguise the nature, the location, the
source, the ownership, or the control of the proceeds of specified unlawful activity; or to avoid a transaction
reporting requirement under Article 6 of this Act,
shall be sentenced to a fine of not more than P500,000 or twice the
value of the property involved in the transaction instrument whichever is
higher, or imprisonment of 12 to 20 years, or both.
b.
Whoever
knowingly transports, transmits, or transfers, or attempts to transport,
transmit, or transfer a monetary instrument or funds from the Philippines to or
through a place outside the Philippines or from or through a place outside the
Philippines–
i.
with the
intent to promote the carrying on of specified unlawful activity; or
ii.
knowing that
the monetary instrument or funds involved in the transportation, transmission,
or transfer represent the proceeds of any of unlawful activity and knowing that
such transportation, transmission, or transfers in designed in whole or in part
to conceal or disguise the nature, the locations, the source, the ownership, or
the control of the proceeds of specified unlawful activity or to avoid a
transaction reporting requirement under this Act,
shall be sentenced to a fine of P500,000 or
twice the values of the monetary instrument or funds involved in the
transportation, transmission, or transfer whichever is higher, or imprisonment
of 12 to 20 twenty years or both. For the purpose of the offense described in
subparagraph b, the defendants’ knowledge may be established by proof that a
law enforcement officer represented the matter specified in subparagraph ii as
true, and the defendants’ subsequent statements or action indicate that the
defendants believed such representations to be true.
c.
Whoever, with
the intent –
i.
to promote
the carrying on of specified unlawful activity under Article 5;
ii.
to conceal or
disguise the nature, location, source of ownership, or control of property
believed to be the proceeds of specified unlawful activity; or
iii.
to avoid a
transaction reporting requirement under
Article 6 hereof;
conducts or attempts to conduct a financial
transaction involving property represented to be the proceeds of specified
unlawful activity, or property used to conduct or facilitate specified unlawful
activity, shall be fined under this title or imprisoned for 12 to 20 years, or
both.
d.
Whoever conducts or attempts to conduct a transaction
described in paragraph (a) or a transportation, transmission, or transfer
described in paragraph (b) is liable to the Republic of the Philippines for a
civil penalty of not more than the value of the property, funds, or monetary
instruments involved in the transaction or
P500,000.00, whichever is
higher.
Article 6. RECORD KEEPING AND REPORTING OF SUSPICIOUS TRANSACTIONS.
(a) banks as defined under the Central Bank Act;
(b) cooperative, credit societies and credit unions;
(c) insurance companies;
(d) trust and loan entities;
(e) persons engaged in the business of dealing in securities, including portfolio management and investment counseling;
(f) persons engaged in the business of foreign exchange dealing;
(g) any other similar businesses.
Section 2. Record Keeping - Every person or entity shall keep and retain records that relate to financial transactions in accordance with this Article.
Section 4. Every person or entity shall maintain a list, in the prescribed form and manner, of their clients in respect of whom a report would have been required under the preceding paragraphs.
Section 5. Confidentiality - No person or entity shall disclose that they have made a report under the preceding section, or disclose the contents of such report, with the intent to prejudice a criminal investigation which has begun.
Section 6. Immunity - No criminal or civil proceedings lie against a person or an entity for making a report in good faith.
Article 7. Disclosure of Information.
Section 1. An officer of the FTRAC who has reasonable grounds to believe that information referred to in subsection (1) would be relevant to investigating or prosecuting a money laundering offense may disclose the information to the appropriate law enforcement agency. An officer is required to comply with a subpoena, an order for production of documents, summons or any other compulsory process only if it is issued in the course of:
a. criminal proceedings where information has been filed in court;
b. any legal proceedings that relate to the administration or enforcement of this act;
c. Investigations of law enforcement agencies.
“Officer” shall mean a person who obtained or who has or had access to information referred herein in the course of exercising powers or performing duties and functions.
Section 2. Use of Information - No officer shall use information referred to in the preceding paragraph for any purpose than exercising powers or performing duties and functions.
Article 8. FINANCIAL TRANSACTIONS AND REPORTS ANALYSIS CENTER (FTRAC).
Section 1. There shall be created Financial Transactions and Reports Analysis Center under the control and supervision of the Department of Finance. The objective is to establish an independent body that:
(a) Coordinates with law enforcement agencies and other entities to which it is authorized to disclose information;
(b) collects, analyzes, assesses and discloses information on suspicious financial transactions in order to assist in the detection, prevention and deterrence of money laundering and other illegal financial activities;
(c) ensures that personal information under its control is protected from unauthorized disclosure; and
(d) ensures compliance with international standards and protocols on money laundering.
Section 2. Power and Duties of the FTRAC - The Financial Transactions and Reports Analysis Center shall have the following powers and duties:
a. It shall receive reports or information provided by any person or entity, law enforcement agencies or government institutions or agencies, those provided by agencies of other countries and other information about suspicious financial transactions that is voluntarily provided;
b. It may collect information that it deems relevant to money laundering activities, store in databases and maintain for purposes related to law enforcement investigation;
c. It shall analyze and assess the reports and information and;
d. Subject to existing rules or laws on privacy, it shall retain each report and all information for a minimum of five years;
e. Prepares periodic reports and assessment of financial transactions.
Section 3. Disclosure and Use of Information -The FTRAC shall not disclose the information set out in a report that are made under Article 6 hereof or those information other than publicly available that are obtained in the administration or enforcement of this Act.
Section 4. The FTRAC, on the basis of its analysis and assessment, has reasonable grounds to believe that collected information would be relevant to investigating or prosecuting predicate offenses, it shall report the information to:
a. The appropriate law enforcement agency;
b. The Bureau of Internal Revenue, on matters that is relevant to an offense of evading or attempting to evade paying taxes or duties imposed under our revenue code or custom tariff code and other tax laws;
c. The National Security Council on information relevant to threats to the security of the Philippines;
d. The Bureau of Immigration on information involving foreigners in money laundering activities.
Section 5. Disclosure to Foreign State - The FTRAC may disclose designated information under the principle of reciprocity and mutual assistance to:
a. an institution or agency of a foreign state or of an international organization established by their governments that have powers and duties similar to those of the FTRAC provided that such information are officially requested;
b. the FTRAC has reasonable grounds to believe that the information would be relevant to the investigation of any predicate offense or a substantially similar offense in another state.
Section 6. Prohibition - No person, who obtained or who has or had access to information in the course of exercising powers or performing duties and functions under this Act, shall use the information for a purpose other than exercising those powers or performing those duties and functions.
Section 7. Research and Public Education - The FTRAC may:
a. inform persons and entities that have provided a report about
measures that have been taken with respect to reports of transactions under those sections;
b. conduct research into trends and development in the area of racketeering activities and improved ways of detecting, preventing and deterring them; and
c. undertake measures to inform the persons and entities, authorities engaged in the investigation and prosecution of money laundering and others with respect to the nature and extent of laundering in the Philippines and other measures that might be taken to detect, prevent and deter money laundering activities in the Philippines.
Section 8. Limitation - The FTRAC may not disclose any information that would identify a person or an entity about whom a report was provided.
Section 9. Immunity from Compulsory Processes - The FTRAC or any of its officers who has obtained or who has or had access to any information or documents in the course of exercising his powers or performing duties and functions under this Act, is required to comply with a subpoena, an order for production of documents, summons or any other compulsory process only if it is issued in the course of court proceedings.
Section 1. Limitation or Orders for Disclosure of Information - Despite any other provisions of law, an order for disclosure of information may be issued in respect of the unit under the following conditions:
a. If the court considers it advisable in the public interest, the court to which an application is made may order the Director of FTRAC or any person specially designated in writing by the Director for the purposes of examining all information and documents to which the application relates or, if the court considers it necessary under the circumstances to produce the information and documents to the law enforcement agency and authorize the removal thereof, where the judge is satisfied-
i. of the matters referred to in Section 2 hereof; and
ii. that there are reasonable grounds for believing that it is in the public interest to allow access to the information or documents, having regard to the benefit likely to accrue to the investigation if the access is obtained. The order must be complied within ten days following the service of the order.
Section 2. Application – Any State Prosecutor may, for purposes of an investigation in respect of a money laundering , make an application under the following circumstances for an order for disclosure of information.
An application shall be made ex-parte in writing to a judge and shall be accompanied by a sworn affidavit on the information and belief of the State Prosecutor or a person specially designated by him for that purpose, deposing to the following matters:
a. the offense under investigation;
b. the person in relation to whom the information or documents referred to in paragraph (c) are required;
c. the type of information or documents whether in written form, in the form of a report or record or in any other form obtained by or on behalf of the FTRAC Director in respect of which disclosure is sought;
d. the facts relied on to justify the belief, on reasonable grounds, that the person referred to in paragraph (b) has committed or benefited from the commission of a money laundering offense and that the information or documents referred to in paragraph (c) are likely to be of substantial value, whether alone or together with other materials, to an investigation in respect of that offense;
e. a summary of any information already received from the FTRAC relative to the offense; and
f. information respecting all previous applications brought under this section on any person being investigated for the offense.
Section 3. Service Order - A copy of the order shall be served on the person to whom it is addressed in the manner that the judge directs or as prescribed by the Rules of Court.
Article 10. Objection to Disclosure of Information. - The Director or any person specially designated in writing by the Director may object to the disclosure of any information or document in respect of which an order under this paragraph has been made by certifying orally or in writing that it should not be disclosed on the ground that:
a. the Director is prohibited from disclosing the information or document by any bilateral or international treaty, convention or other agreement respecting the sharing of information related to money laundering offense or substantially similar offense to which the Government of the Philippines is a signatory;
b. a privilege is attached by law to the information or document;
c. the information or document has been placed in a sealed package pursuant to law or an order of court of competent jurisdiction; or
d. disclosure of the information or document would not, for any other reason, be in the public interest.
Article 11. Compliance Measures. -An authorized person may, from time to time, examine the records and inquire into the business and affairs of any person or entity covered by this Act for the purpose of ensuring compliance, and for that purpose may
a. at any reasonable time, enter any premises, other than a dwelling-house, in which the authorized person believes, on reasonable grounds, that there are records relevant to the investigation of a money laundering offense;
b. use or cause to be used any computer system or data processing system in the premises to examine any data contained in or available to the system;
c. reproduce any records, or cause it to be reproduced from the data, in the form of a print out or other intelligible output and remove the printout or other output for examination or copying; and
d. use or cause to be used any copying equipment in the premises to make copies of any record.
Section 2. Warrant Required to Enter Dwelling-house - If the premises referred to is a dwelling-house, the authorized person may not enter it without the consent of the occupant except under the authority of a warrant issued by a judge.
Article 12. Liability and Offenses. - If a person or an entity commits an offense under this Act, any officer, director or agent of the person or entity who directed, authorized, assented to, acquiesced in, or participated in its commission is a party to and guilty of the offense and liable on conviction to the punishment provided for the offense, whether or not the person or entity has been prosecuted or convicted.
Section 1. Every person or entity proven guilty of unauthorized disclosure shall be liable to an imprisonment of not more two years or a fine of nor more than P50,000.00 or both in the discretion of the court.
Section 2. No person or entity shall be convicted of an offense if they exercised all due diligence to prevent its commission.
Article 13. ASSET FORFEITURE BUREAU (AFB). - There shall be created an Asset Forfeiture Bureau under the Department of Justice.
Section 1.
The AFB shall exercise the following powers and functions:
a. It shall be responsible for all seizure and forfeiture of assets and properties subject of prosecution under this Act.
b. It shall see to it that assets and properties are preserved and protected. Necessary measures against the depreciation of its value must be made, including the conduct of auction sale. The proceeds thereof shall be deposited in a special account and shall not be disposed of until the finality of the decision of the case.
c. It shall direct the disposition of the property by sale or any other commercially feasible means pursuant to existing laws, rules and regulations on the sales of government properties.
d. It shall administer the proceeds of any sale or other dispositions of property which shall be deposited in the National Treasury. After the finality of the decision, fifty percent of the proceeds shall go the government and the other fifty percent shall be deposited under AFB special account for the training of law enforcement officers, prosecutors and other personnel involve in this undertaking, upgrading of investigative equipment, programs and projects for the effective implementation of this Act.
Section 2. It shall assess and approve the
programs and projects of the law enforcement agencies, prosecutors and other
personnel for the development of necessary skills essential for the
intelligence operation, investigation and prosecution of offenses under this
Act.
Article 14. Forfeiture. - Any person convicted of any of the
prohibited acts provided under Article 5 hereof shall forfeit in favor of the
Philippine Government:
1.
any interest
acquired or maintained through money laundering activity;
2.
any interest
in, security of, claim against, or property or contractual right of any kind
affording a source of influence over any enterprise which any person has
established, operated, controlled, conducted, or participated in the conduct of
such unlawful acts; and
3.
any property
constituting, or derived from any proceeds which the person obtained directly
or indirectly, from laundering activities. All rights, titles and interest in
property described in the preceding paragraph shall be vested in the Philippine
government under this Article. The manner of disposition thereof shall be in
accordance with Article 13 and 14 of this Act.
Article
15. Jurisdiction. - Any of the
Regional Trial Courts of the place where any element of money laundering
activities has been committed shall have jurisdiction over cases filed under
this Act, including applications for forfeiture, petitions for temporary
restraining order or injunction under the next succeeding Articles regardless
of the location of any property subject to forfeiture or where the person
resides or where the enterprise is located.
Article
16. Sequestration. - All properties of the defendant shall be subject to
sequestration upon the filing of a
criminal complaints against him. Other assets discovered during the
proceeding shall also be sequestered.
Article
17. Temporary Restraining Order. - A temporary restraining order effective
for sixty (60) days may be issued upon application by the State Prosecutor
without notice or opportunity for a hearing before, during or after the filing
of the information directing the defendant or any person acting on his behalf
to desist from disposing and to preserve the availability of the property for
forfeiture, if the Philippine government demonstrates that there is probable
cause to believe that the property would be subject to forfeiture and that the
provision of notice will jeopardized the availability of the property for
forfeiture.
Article
18. Preliminary Injunction. -
Within sixty (60) days after the issuance of a temporary restraining order, the
court shall conduct a hearing with notice to all parties concerned. A writ of
preliminary injunction shall be issued if the court determines that:
a.)
There is
substantial probability that the Philippine government will prevail on the
issue of forfeiture and that failure to issue the writ will result in the
property being destroyed, removed, disposed of or otherwise made available for
forfeiture; and
b.)
The need to
preserve the availability of the property through the writ outweighs the
hardship on any party against whom it is directed.
Article 19. Evidence
Required. - In the hearing for the prosecution of cases
filed under this Act, the sole testimony of a participant or conspirator, if
credible, can be the basis for conviction of the other defendants: Provided, That, for purposes of the hearing
for the writ of preliminary injunction, the court shall not be bound by the
technical rules on evidence under the Rules of Court: Provided, further, that the evidence was taken without violating
the constitutional rights of the accused.
Article 20. Judgment of Forfeiture. -
Upon conviction of person under this section, the court shall enter a
judgment of forfeiture of the property in favor of the Philippine government
and shall authorize the Secretary of Justice or the Solicitor General to seize
all properties ordered forfeited:
Provided, That the judgment of forfeiture in the original case shall be
without prejudice to the right of the government to initiate further forfeiture
proceeding on properties that may later on be discovered as part of the
proceeds of the commission of the crime of
money laundering.
Article 21. Restitution of Property to Victims. -
The court entering the judgment of conviction and forfeiture upon
finality of the decision shall hear petitions by victims of money laundering
activity for restitution of their property or for their compensation. The court
may order portions of the proceeds of the sale of forfeiture property deposited
with the National Treasury to be paid to the victims.
Article 22. Rights of Third Parties. -
No party claiming an interest in property subject to forfeiture may:
a.)
Intervene in
a trial or appeal of a criminal case involving the forfeiture of such property;
or
b.)
Commence an
action at law or equity nor may any court issue a restraining order or
injunction against the Philippine government concerning the validity of his
alleged interest in the property subject to forfeiture.
However, any person, other than
the defendant, asserting a legal interest in property ordered forfeiture may,
within thirty (30) days from publication by the Secretary of Justice or
Solicitor General of the judgment for forfeiture in two (2) national newspapers
of general circulation in the Philippines, petition the court for a hearing to
adjudicate the validity of his alleged interest in the property.
If, after hearing, the court
determines that the petitioner has established by preponderance of evidence
that: a) the petitioner has legal
rights, or interest in the property; or b)
the petitioner is a bonafide purchaser for value of the right,
title or interest in the property and was at the time of purchase reasonably
without cause to believe that the property was acquired through a racketeering
act or otherwise subject to forfeiture, the court shall amend the order of
forfeiture in accordance with its findings.
Article 23. Substitution of Other Properties. – The court shall order the substitution
and/or forfeiture of any other property of the defendant equivalent to value of
any property described in Article 14,
if any of the said property;
1.)
Cannot be
located upon the exercise of due diligence;
2.)
Has been
transferred or sold to a third party who acquired the same in good faith;
3.)
Has been
placed beyond the jurisdiction of the courts;
4.)
Has been
substantially diminished in value; or
5.)
Has been
commingled with other property which cannot be divided without difficulty.
Article 24. Civil Remedies. -
a.) The Secretary of Justice or
the Solicitor General may initiate civil action in any of the Regional Trial
Courts of the place where any element of any money laundering activity has been
committed which shall have jurisdiction to prevent or restrain unlawful acts
provided under Article 4 and 5 hereof, irrespective of where the person resides
or is found or where the enterprise or property is located by issuing
appropriate orders including but not limited to:
1.)
Ordering any
person to divest himself of any interest, direct or indirect in any enterprise;
2.)
Imposing
reasonable restriction on the future activities or investments of any person
including but not limited to, prohibiting any person from engaging in the same
types of endeavor as the enterprise engaged in; or
3.)
Ordering the
dissolution or reorganization of any enterprise, making provision for the
rights of innocent persons.
A final judgment rendered in
favor of the Philippine government in any criminal proceeding shall be an
estoppel for the defendant from denying the essential allegations of the
criminal offense in any subsequent civil proceeding brought by the Philippine government;
b.
Any person
injured in his person, business or property or his heirs, by reason of
activities under Article 4 hereof, may sue therefore in the appropriate
regional trial court as provided in the
preceding paragraph and may be entitled to recover threefold the damages
he sustains and the cost of the suit, including a reasonably attorney’s fees
against all persons found guilty under this Act.
Article
25. Expedited Action. - In any
civil action instituted under the preceding Article, the Regional Trial Court
shall expeditiously try and hear the case, giving preference to the same over
all other civil cases.
Article
26. Subpoena Duces Tecum. - a.)
Whenever the State Prosecutor has reason to believe that any person or
enterprise may be in possession or control of any documentary material relevant
to a money laundering investigation, he may, prior to the institution of a
criminal or civil proceedings, apply with the court for the issuance of a subpoena
duces tecum thereof, requiring such person to produce such materials for
examination;
b. Any person who has duly
served been with subpoena duces tecum shall make available for
inspection, copying or reproduction to the custodian designated therein at any
place agreed upon and shall certify under oath that the copies are true
reproductions of the original, which certified copies shall be admissible in
court as originals;
c.
While in the
possession of the custodian, no material so reproduced shall be available for
examination, without the consent of the person who produced such material, by
any individual other than the State Prosecutor.
Article 27. Statute of Limitation. -
One of the predicate acts of money laundering must have been committed
within ten (10) years from the date of the information, otherwise violations of
this Act shall be deemed to have prescribed.
Article 28. Consolidation of Cases. -
The trial for criminal liability for each predicate act of money
laundering activity shall be consolidated with the court hearing the case.
Article 29. Repealing
Clause. - All laws, decrees, rules and regulations or
parts thereof inconsistent with this Act are hereby amended, repealed or
modified accordingly.
Article 30.
Separability Clause.
- If, for any reason, any part or
provision of this Code shall be held unconstitutional or invalid, other parts
or provisions hereof which are not affected thereby shall continue to be in
full force and effects.
Article 31. Effectivity. -
This Act shall take effect fifteen (15) days after its complete publication in
at least two (2) national newspaper of general circulation.
Approved.