SEC orders submission of money laundering prevention program

sec orders submission of money laundering prevention program - SEC orders submission of money laundering prevention program

THE Securities and Exchange Commission (SEC) is requiring firms to submit a revised program against money laundering and terrorist financing within the next two months.

The regulator published in newspapers on Thursday Memorandum Circular No. 29, or the 2020 guidelines on the submission and monitoring of the Money Laundering and Terrorist Financing Prevention Program (MTPP).

The MTPP is a submission that the SEC requires from covered persons through Memorandum Circular No. 16 Series of 2018, or the 2018 Guidelines on Anti-Money Laundering and Combating the Financing of Terrorism for SEC Covered Institutions (2018 AML/CFT Guidelines).

“All covered persons registered after the effectivity of the 2018 AML/CFT Guidelines but before the effectivity of this circular and who have not yet submitted their MTPPs/revised MTPPs shall do so within two months from the effective date of this circular,” the SEC said in its new memorandum.

The circular takes effect 15 days after its publication in two national newspapers and the SEC website, which both happened this week.

Covered persons, or entities required to comply with the submission of MTPPs, are financial institutions regulated by the central bank, the Insurance Commission and the SEC, and designated non-financial businesses and professions such as jewelry dealers and casinos.

Based on the implementing rules and regulations of the Anti-Money Laundering Act, the MTPP has to contain a company’s “comprehensive, risk-based, and written internal policies, controls and procedures to implement the relevant laws, rules and regulations, and best practices to prevent and combat (money laundering and terrorist financing).”

Hard and soft copies of the MTPPs have to be submitted to the Anti-Money Laundering Division of the Enforcement and Investor Protection Department of the SEC. The document has to be duly approved by the covered persons’ board of directors, or for foreign corporations, the country head or its equivalent for local branches.

Through the same circular, the SEC said it is no longer requiring the MTPP as a submission for companies applying for registration and secondary license with its Company Registration and Monitoring Department.

Instead, applicants may submit a sworn certification that it has prepared an MTPP approved by its board of directors. This certification has to be stamped by the Anti-Money Laundering Division to be acknowledged by the Company Registration and Monitoring Department.

The circular also requires that financing and lending companies that would reach the P10-million minimum paid-up capital or exceed the 40% maximum foreign equity must submit copies of their MTPPs to the SEC within 60 days from when the thresholds are breached.

The SEC said the new circular fulfills part of its mandate as a supervising authority of Republic Act No. 9160 or the Anti-Money Laundering Act of 2001, Republic Act No. 8799 or the Securities Regulation Code, and Republic Act No. 11232 or the Revised Corporation Code of the Philippines. — Denise A. Valdez

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