The Bank of the Philippine Islands, and 9 more banks are in the line of fire as the Bangko Sentral ng Pilipinas investigates a massive money laundering scandal involving an Australian bank.
The central bank believes that at least one of these banks has incriminating ties with the Australian bank, Westpac.
At the center of the inquiry is the Bank of the Philippine Islands (BPI).
This is mainly because BPI is the remittance partner of Westpac, one of the biggest Australian banks today.
According to CNN, Westpac allegedly did not report over $19.5 million fund transfer instructions between Australia and the Philippines as well as with other Southeast Asian nations.
Aggravating the oversight is that the transactions in question could involve utilized for child abuse and exploitation.
How Bank of the Philippine Islands Played A Role
Moreover, the Australian regulator AUSTRAC is alleging the bank currently in the hot seat of breaking the law beyond 23 million times.
The supposed regular and low-value payments sent through LitePay went as far back as 2013, at least.
LitePay is WestPac’s online remittance platform.
BSP Deputy Governor for Financial Supervision, Chuchi Fonacier, singled out the possible role that BPI played in the fiasco.
According to him, the bank possibly served as an entry point for the suspicious cross-border transactions.
Once in BPI, the money is eventually moved to accounts with other banks.
Speaking with reporters, Fonancier claimed that the BSP already identified several banks that received these remittances from Australia.
The first thing they will do is to conduct a review. If necessary, however, they will go the banks themselves to check if they are compliant to anti-money laundering regulations.
Other Banks Unnamed Yet
Apart from BPI, though, the BSP is yet to name the other banks.
BPI already submitted a partial report in the bid to cooperate with the investigation.
Review of the said document to verify details of the incident can take up to January 2020.
Fonacier explained that the process is tedious since it will involve checking small-value transactions across different bank accounts.
The fact that these transactions are small-value ones meant they did not even need to be reported to the Anti-Money Laundering Council. None met the threshold of fund transfers worth P500,000 in a day.
None of the transactions also look suspicious or out-of-pattern. Otherwise, reports would be necessary.
Fonacier, however, asserted that banks should still practice due diligence before they clear any money transfer.
After the scandal broke out, two top executives of Westpac already stepped down.
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