THE BANKERS’ Association of the Philippines (BAP) will set up a centralized system for the reporting and verification of accounts suspected to be involved in prohibited acts under the Anti-Financial Account Scamming Act (AFASA).
“So, the BAP is coming out with what we call a coordinated verification protocol. They have one year to come up with that. Now, it will be a computerized system. You have to use big data, you have to use AI (artificial intelligence), so that all of these things can be done real-time. Theoretically, the whole system should be alerted if I report potential fraud,”Bangko Sentral ng Pilipinas (BSP) Deputy Governor Elmore O. Capule told reporters on the sidelines of an event last week.
“Plus, there will be a database. All the scam-related accounts will be in the database. So, it will make this faster.”
The BAP has one year to come out with the coordinated verification protocol, the BSP official said.
“They are working on it now. They already passed something to us, and I think the way they are doing it, they are very enthusiastic. Once it becomes operational, it will be very smooth.”
The AFASA was signed into law by President Ferdinand R. Marcos, Jr. in July 2024 and seeks to help prevent and penalize financial cybercrime.
Under the law, the BSP can now investigate and inquire into financial accounts involved in prohibited acts or offenses, which include money mule activities and social engineering schemes, mass mailers, or human trafficking, as well as other offenses such as opening a financial account under a fictitious name or using the identity or identification documents of another person.
BAP President Jose Teodoro K. Limcaoco, who is also Bank of Philippine Islands’ president and chief executive officer, earlier said the group had proposed a coordinated fraud reporting center.
Mr. Limcaoco told reporters at the same event last week that the BAP was scheduled to meet with the central bank to clarify how fraud reporting will be implemented under the AFASA. He added that the BAP is also working with the Philippine Payments Management, Inc. (PPMI) on establishing the rules of engagement.
“It’s being circulated now. It’s being discussed by the operations team at PPMI.”
BANK SECRECYMeanwhile, Mr. Capule allayed industry concerns that implementing the AFASA could conflict with existing bank deposit secrecy laws.
“The law is very explicit that it is an exception to bank secrecy… So, you can’t invoke bank secrecy. If you put bank secrecy, then you can’t investigate,” he said.
“The coordinated verification among banks, that’s exempt from bank secrecy. Opening of deposits [suspected of violating the AFASA], that’s exempt from bank secrecy. The BSP is given the authority to open bank accounts,” Mr. Capule added.
Under the AFASA and its implementing rules, bank secrecy laws will not apply to any financial accounts under inquiry or investigation by the BSP for violating the law, as well as the coordinated verification process among financial institutions identified or involved in a disputed transaction chain.
Mr. Capule also said that the bank secrecy exceptions granted under the AFASA are “already huge.” — A.M.C. Sy
