Case Analysis number 1

Anti-money laundering body reports more suspicious transactions during COVID-19 pandemic

Make sure that the online transaction platforms you're using are not also being devised by somebody else to commit fraudulent activities.

The Anti-Money Laundering Council (AMLC) noticed a rising number in suspicious transaction reports (STRs) this year in the time of COVID-19 pandemic.

AMLC Executive Director Mel Racela said the number of STRs since January up to now is at around 400,000, the same number for the entire 2019.

"So yes, it has been increasing and the usage of suspicious transaction reports is not a good indication if whether or not these are useful to us," Racela told reporters during the virtual presser hosted by the Presidential Communications Operations Office.

Racela, however, noted that not all the STRs can be considered as related to any unlawful activity especially if the crime was not properly identified.

He explained misinformation found in identification documents presented to a financial entity can be considered an STR but not necessarily a crime.

"So the number is not indicative of any increasing number of crimes also in the Philippines but the AMLC has continuously conducted a study on the STRs," Racela added.

The AMLC chief also reminded the so-called covered persons to be careful when using online transaction platforms.

Among the covered persons are those working in banks, insurance companies, pawnshops, foreign exchange firms, among many others.

For the full list of covered persons, you may visit this section of the AMLC website:bit.ly/3k8XGnI

AMLC urges Congress to pass much needed AMLA amendments

The AMLC, meanwhile, urged the Congress to immediately pass certain amendments to the Anti-Money Laundering Act of 2001.

Among these are including tax crimes as predicate crimes to money laundering, and listing real estate developers and brokers as part of covered persons.

Racela also wanted the Congress to expand AMLC's powers which includes issuing a subpoena and invoking contempt powers.

"Failure to pass and to implement the amendments to the AMLA before February 2021 will have similar effects that is the Philippines' inclusion to the Financial Action Task Force - International Cooperation Review Group Gray List," Racela warned.

The FATF-ICRG Gray List is composed of nations considered to be high-risk when it comes into money laundering.

He said this will result into more layers of scrutiny from regulators and financial institutions in other countries.

Racela fears this may also increase the cost of doing business with Filipinos and block the country's chances to an A credit rating.

develop a case analysis from the article above. and Follow this format.

1. Introduction
2. Issue underlying the problem
3. alternative solution to the problem
4. conclusion
5. recommendation

Case Analysis number 2

SEC-Cebu warns online lenders harassing borrowers

CEBU CITY- The Securities and Exchange Commission-Cebu extension office (SEC-CEO) has warned online lending operators against harassment of borrowers in collecting debts.

Lawyer Alma Marie Dalena, SEC-Cebu officer-in-charge, said her office has taken steps in protecting the public from unfair debt collection using harassment to corner borrowers.

"Even before the Covid-19 (coronavirus disease 2019) pandemic arrived in the Philippines, our office has already taken measures in protecting the public against unfair debt collection which includes the use of or the threat of use of violence to harm the person, his reputation or property as embodied in SEC Memo No. 18 series of 2019," Dalena said.

In a message sent to the Philippine News Agency late Monday, Dalena said Republic Act 11469, or the Bayanihan to Heal As One Act and its implementing rules and regulations (IRR), provides a 30-day grace period for all loans with principal or interest falling due with the enhanced community quarantine (ECQ).

"Financing, lending and even micro-lending corporations are hereby warned that any violation shall be dealt with the full extent of the law," Dalena said.

She said the commission has noted online lending operators' abusive collection practices, which constituted unfair debt collection practices expressly prohibited under SEC Memorandum Circular No. 18, series of 2019.

She said online lending operators gain access to personal information stored in borrowers' mobile phones, including social media accounts, contact numbers and email addresses through their mobile applications.

The online lending operators then use such information to exact prompt payment. They would send a text blast to the borrower's contacts to inform them about the borrower's indebtedness and his/her supposed refusal to pay the amount due.

In other cases, the borrower would be threatened with legal action or public shaming.

"The abusive collection practices, misrepresentations, and unreasonable terms and conditions imposed by the online lending operators and their agents and representatives exemplify the practices that as a matter of policy, the State seeks to prevent," a separate statement said.

Dalena also warned the public against online lending operators that are offering loans to the public even without a valid certificate of incorporation and certificate of authority to operate as a financing company.

In a separate statement, Dalena said SEC has ordered operators of four online lending applications to cease and desist from offering and providing loans to the public.

The cease and desist order issued by the commission en banc on April 14 covers CashAB, CashOcean, KwikPeso and Little Cash, together with their owners, CashAB Lending Corp., Mimosa Credit Ltd., and Zamoya Credit Ltd.

The SEC directed the online lending operators, their agents, representatives and promoters, as well as the owners of their hosting sites and all persons acting for and, on their behalf, to immediately cease and desist under pain of contempt from engaging in, promoting and facilitating lending activities.

The statement said the commission further ordered the online lending operators to cease from offering and advertising their lending business through the internet and to delete or remove their promotional presentations and offerings, including their lending apps.

CashAB, CashOcean, KwikPeso, and Little Cash have offered and provided loans to the public without a validly subsisting certificate of incorporation and certificate of authority to operate as a lending or financing company from the SEC.

"Section 4 of Republic Act 9474, or the Lending Company Regulation Act of 2007, requires that a lending company be established only as a corporation. It further provides that no lending company shall conduct business unless granted an authority to operate by the SEC," it said.

Section 12 of the law penalizes any person who shall engage in the business of lending without a validly subsisting authority to operate from the SEC. He/she may face a fine ranging from PHP10,000 to PHP50,000 or imprisonment of six months to 10 years or both.

Similarly, Republic Act 5980, or the Financing Act of 1998, punishes the act of engaging in the business of a financing company without the requisite authority from the SEC with a fine of not less than PHP10,000 and not more than PHP100,000, or imprisonment for not more than six months or both, it said.

"Aside from lacking the necessary licenses to operate, the online lending operators have failed to disclose certain information in their advertisements and online platforms as mandated by SEC Memorandum Circular No. 19, series of 2019," it further read.(PNA)

develop a case analysis from the article above. and Follow this format.

1. Introduction
2. Issue underlying the problem
3. alternative solution to the problem
4. conclusion
5. recommendation