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LBP LEASING AND FINANCE CORPORATION (A Land Bank Subsidiary)

MONEY LAUNDERING AND TERRORIST FINANCING PREVENTION PROGRAM

(MLPP)

REVISED – December 2017

(Approved by BOD on January 24, 2018)

TITLE OF MANUAL

MONEY LAUNDERING AND

TERRORIST FINANCING

PREVENTION PROGRAM

(MLPP)

INITIAL ISSUE DATE

September 25, 2002 REVISION NO.

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TABLE OF CONTENTS

Chapter 1: Background

A. Introduction 4 B. Purpose 4 C. Basic Principles and Policies to Combat Money Laundering 5 D. Definition of Terms 5 E. Stages of Money Laundering 17 F. Review of Manual 19

Chapter 2: AMLA and TF Suppression Act Requirements

A. Requirements under the AMLA of 2001, as Amended and Terrorism Financing Prevention and Suppression Act of 2012 19

B. Sanctions and Penalties for the Crime of Money Laundering and Terrorism Financing Offenses 21

C. Non-Discrimination against Certain Types of Customers 26 D. Mistaken Identity, Safe Harbor Provision 26 E. Exemption From Bank Secrecy Laws 27

Chapter 3: Organizational Structure for AMLA Compliance

A. Audit Committee 27 B. Management Committee 27 C. Anti-Money Laundering Committee 28 D. Compliance Office 29 E. Business Units 31 F. Risk Management Unit 31 G. Internal Audit Unit 32

Chapter 4: Preventive Measures

A. General Principles B. Customer Acceptance Policy 32 C. Customer Identification 33 D. Customer Profiling 36 E. Personal/Individual Customers 40 F. High Risk Customers 41 G. Sole Proprietorships, Corporations, Stock and Non-Stock Partnerships 41

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H. Shell Companies 43 I. Trust, Nominee and Fiduciary Accounts 43 J. Transaction Undertaken on Behalf of Client or Client Companies 44 K. Politically Exposed Person (PEP) 44 L. On-going Monitoring of Customers and Transactions 45

Chapter 5: Reporting Requirements and Procedures 45 Chapter 6: Record Keeping and Retention 47 Chapter 7: Training Program 49 Chapter 8: AMLA Program 50 Chapter 9: Authority To Bank Inquiry and Freeze Order 52 Chapter 10: Annexes 54

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CHAPTER 1 – BACKGROUND

A. INTRODUCTION

The Money Laundering and Terrorist Financing Prevention Program (MLPP) formerly known as the Anti-Money Laundering Manual (AML Manual) embodies the Corporations’ comprehensive and risk-based operating procedures geared toward the promotion of high ethical and professional standards and the prevention of the Corporation being used intentionally or unintentionally, for money laundering and terrorism financing activities. The MLPP shall be consistent with the Anti-Money Laundering Act (AMLA) under RA 9160 as amended by RA 9194, RA 10167 and RA 10365, and its Revised Implementing Rules and Regulations (RIRR). The Terrorism Financing and Prevention and Suppression Act of 2012 (RA 10168) and its Implementing Rules and Regulations (IRR), as well as issuances by the Bangko Sentral ng Pilipinas (BSP), Securities and Exchange Commission (SEC), the Land Bank of the Philippines and subsequent issuances of pertinent laws and regulations. The provisions of MLPP shall be implemented by LBP Leasing and Finance Corporation’s (LLFC) officers and employees.

B. PURPOSE This Money Laundering and Anti-Terrorism Prevention Program (MLPP) aims to institute preventive measures and deter the use of Corporation’s facilities for laundering the proceeds of crimes and other unlawful activities in compliance with the Anti-Money Laundering Act (AMLA) under RA 9160 as amended by RA 9194, RA 10167, RA 10365 and RA 10168 and its Revised Implementing Rules and Regulations and related BSP and SEC Circulars.

The Anti- Money Laundering Act (AMLA) under RA 9160 and its Amendments under RA 9194, RA 10167 and RA 10365 and the Terrorism Financing Prevention and Suppression Act of 2011 under RA 10168 with its Revised Implementing Rules and Regulations (RIRR) as well as issuances by the Bangko Sentral ng Pilipinas (BSP), Anti-Money Laundering Council (AMLC) and the Securities and Exchange Commission (SEC) and other applicable laws and regulations shall form part of this Manual.

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C. BASIC PRINCIPLES AND POLICIES TO COMBAT MONEY LAUNDERING

In accordance with BSP Circular No. 950, series of 2017, to adopt the policy of the State to ensure that the Philippines in general and covered institutions shall not be used as money laundering site and conduit for the proceeds of an unlawful activity, LLFC as covered institution shall apply the following basic principles and policies to combat money laundering:

1. Conduct business in conformity with high ethical standards in order to protect its safety and soundness as well as the integrity of the financial system.

2. Know sufficiently its customer at all times and ensure that the financially and socially disadvantaged are not denied access to financial services while, at the same time, prevent suspicious individuals or entities from transacting with LBP Lease by himself or otherwise,

3. Adopt and effectively implement a sound AML and terrorist financing risk

management system that identifies, assesses, monitors and controls risks associated with money laundering and terrorist financing,

4. Comply fully with the rules and existing laws aimed at combating money

laundering and terrorist financing by making sure officers and employees are aware of their respective responsibilities and carry them out in accordance with superior and principled culture of compliance, and

5. Fully cooperate with the AMLC for the effective implementation and

enforcement of the AMLA, as amended, and its RIRR. D. DEFINITION OF TERMS For purposes of the Manual, the following terms are hereby defined as follows:

1. Anti- Money Laundering Act (AMLA) refers to Republic Act No. 9160, as amended by Republic Act Nos. 9194, 10167 and 10365. (Rule 3.A of 2016 RIRR of RA 9160, as amended)

2. Anti-Money Laundering Council (AMLC) refers to the financial intelligence unit of the Republic of the Philippines which is the government agency tasked to implement the AMLA.

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3. Supervising Authority refers to the Bangko Sentral ng Pilipinas (BSP), the Securities and Exchange Commission (SEC) and the Insurance Commission (IC), or the relevant regulatory bodies of the Designated Non-Financial Businesses and Professions enumerated under Rule 3.E.4, or other government agencies designated by law. (Rule 3.C of 2016 RIRR of RA 9160 as amended).

4. Person refers to any natural or juridical person (Rule 3.D of 2016 RIRR of

RA 9160, as amended)

5. Covered Person refers to the following:

a. Persons supervised or regulated by BSP, such as Banks, Non-banks, Quasi Bank, Trust Entities, Pawnshops, Non-stock savings and loan association, Electronic Money issuers and all other person and their subsidiaries and affiliates supervised and regulated by the BSP.

For purposes of the RIRR, foreign exchange dealers, money changers, and remittance and transfer companies are covered persons under the supervision of the BSP.

b. Persons supervised and regulated by IC, such as Insurance

companies, Pre-need companies, Insurance agents, Insurance brokers, Professional reinsurers, Reinsurance brokers, Holding companies, Holding company systems, Mutual benefit associations, and all other persons and their subsidiaries and affiliates supervised or regulated by the IC.

c. Persons supervised or regulated by SEC, such as Security dealers,

brokers, salesmen, investment houses, and their similar persons managing securities or rendering services, such as investment agents, advisors, or consultants, mutual funds or open-end investment companies, close-end investment companies or issuers, and other similar entities, other entities, administering or otherwise dealing in commodities, or financial derivatives based thereon, valuable objects, cash substitutes, and other similar monetary instruments or properties, supervised and regulated by the SEC.

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d. The Designated Non-Financial Businesses and Professions such as: (i) Jewelry dealers, dealers in precious metals, and dealers in precious stones,

Dealer refers to an individual or entity who buys and/or sells precious metals, precious stones, and/or jewelry in the course of its business activities. The purchases or sales of precious metals, precious stones, and/or jewelry, as referred to, exclude those carried out for, connected with, or for the purpose of extracting precious metals or precious stones from a mine, or cutting or polishing precious stones. Jewelry refers to finished goods deriving fifty percent (50%) or more of their value from jewels, precious metals or precious stones constituting, forming part of, or attached to said finished goods. Jewel refers to organic substances that have a market recognized gem level of quality, beauty and rarity, such as pearl, amber and coral.

(ii) Company service providers which, as a business, provide any of the following services to third parties such as: acting as a formation agent of juridical persons, acting as (or arranging for another person to act as) a director or corporate secretary of a company, a partner of a partnership, or a similar position in relation to other juridical persons, providing a registered office, business address or accommodation, correspondence or administrative address for a company, a partnership or any other legal person or arrangement, or acting as (or arranging for another person to act as) a nominee shareholder for another person. (iii) Persons, including lawyers and accountants, who provide any of the following services: (i) Managing of client money, securities or other assets, (ii) Management of bank, savings, securities or other assets, (iii) Organization of contributions for the creation, operation or management of companies, and (iv) Creation, operation or management of juridical person or arrangements, and buying and selling business entities. Notwithstanding the foregoing, lawyers and accountant who are: (1) authorized to practice their profession in the Philippines, and

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(2) engaged as independent legal or accounting professionals, in relation to information concerning their clients, or where disclosure of information would compromise client confidences or the attorney-client relationship, are not covered persons. Independent legal or accounting professional are lawyers and accountants working in a private firm or as a sole practitioner who by way business provides purely legal, notarial or accounting services to their clients. (Rule 3.E of 2016 RIRR of RA 9160, as amended)

6. Transaction refers to any act establishing any right or obligation, or giving rise to any contractual or legal relationship between the parties thereto. It also includes any movement of funds by any means with a covered person.

7. Covered Transaction is a transaction in cash or other equivalent monetary instrument exceeding FIVE HUNDRED THOUSAND PESOS (P500,000.00) or exceeding One Million Pesos (P1,000,000.00) in cases of jewelry dealers, dealers in precious metals and dealers in precious stones. (Rule 3.G of 2016 RIRR of RA 9160, as amended)

8. Suspicious Transaction is a transaction regardless of amount, where any of the following circumstances exists: (Rule 3.H of 2016 RIRR of RA 9160, as amended)

a. There is no underlying legal or trade obligation, purpose or

economic justification, b. The client is not properly identified, c. The amount involved is not commensurate with the business or

financial capacity of the client, d. Taking into account all known circumstances, it may be perceived

that the client’s transaction is structured in order to avoid being the subject of reporting requirements under the AMLA,

e. Any circumstance relating to the transaction which is observed to deviate from the file of the client and/or the client’s past transactions with the Corporation,

f. The transaction is in any way related to an unlawful activity or any money laundering activity or offense under the AMLA that is about to be, is being or has been committed, or

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g. Any transaction that is similar, analogous or identical to any of the foregoing.

9. Client/Customer refers to any person who keeps an account, or otherwise transacts business with a covered person. It includes the following:

a. any person or entity on whose behalf an account is maintained or transaction is conducted, as well as the beneficiary of said transactions,

b. beneficiary of a trust, an investment fund, a pension fund, c. a company or person whose assets are managed by an asset

manager, grantor of trust, and d. any insurance policy holder, whether actual or prospective. (Rule

3.I of 2016 RIRR of RA 9160, as amended)

10. Politically Exposed Person (PEP) refers to an individual who is or has been entrusted with prominent public positions in (a) the Philippines with substantial authority over policy, operations or the use of allocation of government-owned resources, (b) a foreign state, or (c) an international organization. The term PEP shall include immediate family members, and close relationships and associates that are reputedly know to have:

a. Joint beneficial ownership of a legal entity or legal arrangement with the main/principal PEP, or

b. Sole beneficial ownership of a legal entity or legal arrangement

that is known to exist for the benefit of the main/principal PEP. (Rule 3.J of 2016 RIRR of RA 9160, as amended)

11. Immediate Family Member refers to spouse or partner, children and their

spouses, and parents and parents-in-law. (Rule 3.K of 2016 RIRR of RA 9160, as amended)

12. Beneficial owner refers to any natural person who:

a. Ultimately owns or controls a customer and whose behalf a transaction or activity is being conducted, or

b. Has ultimate effective control over a legal person or arrangement. (Rule 3.L of the 2016 RIRR of RA 9160, as amended)

13. Official Document refers to any of the following identification documents:

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a. For Filipino citizens: Those issued by any of the following official authorities: Government of the Republic of the Philippines, including its political subdivisions, agencies and instrumentalities, Government Owned- or –Controlled Corporations (GOCCs), Covered persons registered with and supervised or regulated by BSP, SEC or IC,

b. For Foreign nationals: Passport or Alien Certificate of Registration,

c. For Filipino students, School ID singed by the school principal or

head of the educational institution, and

d. For low risk customers: any document or information reduced in writing which the covered person deems sufficient to establish the client’s identity. (Rule 3.M of 2016 RIRR of RA 9160 as amended)

14. Proceeds refer to an amount derived or realized from any unlawful

activity. (Rule 3.P of 2016 RIRR of RA 9160, as amended)

15. Monetary Instrument or Property Related to an Unlawful Activity refers to:

a. All proceeds of an unlawful activity, b. All monetary, financial or economic means, devices, accounts,

documents, papers, items, or things used in or having any relation to any unlawful activity,

c. All moneys, expenditures, payments, disbursement, costs, outlays, charges, accounts, refunds, and other similar items for the financing, operations, maintenance of any unlawful activity, and

d. For purposes of freeze order and bank inquiry, related and materially linked accounts. (Rule 3.Q of the 2016 RIRR of RA 9160, as amended)

16. Related Accounts refers to those accounts, the funds and sources of

which, originated from and /or are materially linked to the monetary instrument(s) or property (ies) subject of the freeze order(s). (Rule 3.R of 2016 RIRR of RA 9160, as amended) Materially linked accounts include but are not limited to the following:

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i. All accounts or monetary instruments belonging to the same person whose accounts, monetary instruments or properties are the subject of the freeze order or an order of inquiry,

ii. All accounts or monetary instruments held, owned or controlled by the owner or holder of the accounts, monetary instruments or properties subject of the freeze order or order of inquiry, whether such accounts are held, owned or controlled singly or jointly with another person,

iii. All “In Trust For” (ITF) accounts where the person whose accounts,

monetary instruments or properties are the subject of the freeze order or order of inquiry,

iv. All accounts held for the benefit or in the interest of the person

whose accounts, monetary instruments or properties are the subject of the freeze order or order of inquiry, and

v. All other accounts, shares, units or monetary instruments that is

similar, analogous or identical to any of the foregoing. 17. Offender refers to any person who commits a money laundering offense.

(Rule 3.S of the 2016 RIRR of RA 9160 as amended)

Money laundering Offense is a crime whereby the proceeds of an unlawful activity are transacted thereby making them appear to have originated from legitimate sources. It is committed by any person who, knowing that any monetary instrument or property represents, involves, or relates to the proceeds of any unlawful activity:

a. Transacts said monetary instrument or property,

b. Converts, transfers, disposes of, moves, acquires, possesses or uses said monetary instrument or property,

c. Conceals or disguises the true nature, source, location, disposition, movement or ownership of or rights with respect to said monetary instrument or property,

d. Attempts or conspires to commit money laundering offenses referred to in paragraphs (a), (b) or (c),

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e. Aids, abets, assists in or counsels the commission of the money laundering offenses referred to in paragraphs (a), (b) or (c) above, and

f. Performs or fails to perform any act as a result of which he facilitates the offense of money laundering referred to in paragraph (a), (b) or (c) above.

18. Unlawful Activity refers to any act or omission or series or combination

thereof involving or having relation to the following: (Rule 3.T of 2016 RIRR of RA 9160, as amended)

i. Kidnapping for ransom under Article 267 of Act No. 3815, otherwise

known as the Revised Penal Code, as amended, ii. Sections 4, 5, 6, 8, 9, 10, 12, 13, 14, 15 and 16 of Republic Act No.

9165, otherwise known as the Comprehensive Dangerous Drugs Act of 2002,

iii. Section 3 paragraphs B, C, D, E,G, H and I of Republic Act No. 3019, as amended, otherwise known as the Anti-Graft and Corrupt Practices Act,

iv. Plunder under Republic Act No. 7080, as amended, v. Robbery and Extortion under Articles 294, 295, 296, 299, 300, 301

and 302 of the Revised Penal Code, as amended, vi. Jueteng and Masiao punished as illegal gambling under Presidential

Decree No. 1602, vii. Piracy on the High Seas under the Revised Penal Code, as amended

and Presidential Decree No. 532, viii. Qualified Theft under Article 310 of the Revised Penal Code, as

amended, ix. Swindling under Article 315 of the Revised Penal Code, as amended, x. Smuggling under Republic Act Nos. 455 and 1937,

xi. Violations under Republic Act No. 8792, otherwise known as the Electronic Commerce Act of 2000,

xii. Hijacking and other violations under Republic Act No. 6235, destructive arson and murder, as defined under the Revised Penal Code, as amended, including those perpetrated by terrorists against non-combatant persons and similar targets,

xiii. Terrorism and Conspiracy to Commit Terrorism as defined and penalized under Section 3 and 4 of Republic Act No. 9372,

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xiv. Financing of Terrorism under Section 4 and offenses punishable under Sections ,5, 6, 7 and 8 of RA 10168, otherwise known as Terrorism Financing Prevention and Suppression Act of 2012,

xv. Bribery under Articles 210, 211 and 211-A of the Revised Penal code, as amended, and Corruption of Public Officers under Article 212 of the Revised Penal Code, as amended,

xvi. Frauds and Illegal Exactions and Transactions under Articles 213, 214, 215 and 216 of the Revised Penal Code, as amended,

xvii. Malversation of Public Funds and Property under Articles 217 and 222 of Revised Penal Code, as amended,

xviii. Forgeries and Counterfeiting under Articles 163, 166, 167, 168, 169 and 176 of the Revised Penal Code, as amended,

xix. Violations of Section 4 to 6 of Republic Act No. 9208, otherwise known as the Anti-Trafficking in Persons Act of 2003,

xx. Violations of Section 78 to 79 of Chapter IV, of Presidential Decree No. 705, otherwise known as the Revised Forestry Code of the Philippines, as amended,

xxi. Violations of Sections 86 to 106 of Chapter VI, of Republic Act No. 8550, otherwise known as the Philippine Fisheries Code of 1998,

xxii. Violations of Sections 101 to 107, and 110 of Republic Act No. 7942, otherwise known as the Philippine Mining Act of 1995,

xxiii. Violations of Section 27 (c), (e), (f), (g) and (i), of Republic Act No. 9147, otherwise known as the Wildlife Resources Conservation and Protection Act,

xxiv. Violation of Section 7 (b) of Republic Act No. 9072, otherwise known as the National Caves and Cave Resources Management Protection Act,

xxv. Violation of Republic Act No. 6539, otherwise known as the Anti-Carnapping Act of 2002, as amended,

xxvi. Violations of Sections 1, 3 and 5 of Presidential Decree No. 1866, as amended, otherwise known as the decree Codifying the Laws on Illegal/Unlawful Possession, Manufacture, Dealing In, Acquisition or Disposition of Firearms, Ammunition or Explosives,

xxvii. Violations of Presidential Decree No. 1612, otherwise known as the Anti-Fencing Law,

xxviii. Violation of Section 6 of Republic Act No. 8042, otherwise known as the Migrant Workers and Overseas Filipinos Act of 1995, as amended by Republic Act No. 10022,

xxix. Violation of Republic Act No. 8293, otherwise known as the Intellectual Property Code of the Philippines,

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xxx. Violation of Section 4 of Republic Act No. 9995, otherwise known as the Anti-Photo and Video Voyeurism Act of 2009,

xxxi. Violation of Section 4 of Republic Act No. 9775, otherwise known as the Anti-Child Pornography Act of 2009,

xxxii. Violations of Sections 5, 7, 8, 9, 10 (c), (d), and (e), 11, 12 and 14 of Republic Act No. 7610, otherwise known as the Special Protection of Children Against Abuse, Exploitation and Discrimination,

xxxiii. Fraudulent practices and other violations under Republic Act No. 8799, otherwise known as the Securities Regulation Code of 2000, and

xxxiv. Felonies or offenses of a similar nature that is punishable under the penal laws of other countries.

In determining whether or not a felony or offense punishable under the penal laws of other countries is “of similar nature”, as to constitute an unlawful activity under the AMLA, the nomenclature of said felony or offense need not be identical to any of the unlawful activities listed below.

19. Probable Cause refers to such facts and circumstances which would lead a reasonably discreet, prudent, or cautious man to believe that any monetary instrument or property sought to be frozen, inquired into or preserved is in any way related to any unlawful activity and/or money laundering offense. (Rule 3.U o 2016 RIRR of RA 9160, as amended)

20. Beneficiary Institution refers to the entity that will pay the money to the beneficiary and can either be:

a. A covered person as specifically defined in BSP Circular 950 and as generally defined by AMLA, as amended, and its IRR, or

b. A financial institution operating outside of the Philippines that are other than a covered person referred above but conducts business operations and activities similar to them.

21. Corporate Vehicles refers to an entity, association or organization that

represents beneficial owner of all companies that have nominee shareholders or shares in bearer form.

22. Dealing, with regard to property of funds refers to receiving, acquiring, transacting, representing, concealing, disposing, converting, transferring or

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moving, using as security or providing financial services. (Rule 3.a.4 of RIRR of RA 10168)

23. Designated persons refer to: (Rule 3.a.5 of RIRR of RA 10168)

i. any person or entity designated and/or identified as a terrorist, on who finances terrorism, or a terrorist organization or group under the applicable United Nations Security Council Resolution or by another jurisdiction or supranational jurisdiction,

ii. any organization, association, or group of persons prescribed pursuant to Section 17 of the Human Security Act of 2007, or

iii. any person, organization, association, or group of persons whose funds or property, based on probable cause are subject for seizure and sequestration under Section 39 of the Human Security Act of 2007.

24. High Risk Customer is a customer that presents greater risk for crime,

corruption or terrorist financing. It may also define as:

a. Accounts with complex, unusually large transaction and all unusual patterns, which have no apparent economic or visible lawful purpose,

b. Accounts with transactions that involve large amounts of cash inconsistent with the normal and expected activity of the customer, and

c. Accounts with high account turnover inconsistent with the size of the balance maintained.

25. Forfeiture refers to a court order transferring in favor of the government,

after due process, ownership of property or funds representing, involving or relating to financing of terrorism as defined in Section 4 or an offense under Sections 5, 6,7 or 9 of RA 10168, otherwise known as the Terrorism Financing Prevention and Suppression Act of 2012. (Rule 3.a.7 of RIRR of RA 10168)

26. Freeze refers to the blocking or restraining of specific property or funds

from being transacted, converted, concealed, moved or disposed of without affecting the ownership thereof. (Rule 3.a.8 of RIRR of RA 10168)

27. Terrorist refers to any natural person who: (a) commits or attempts, or

conspires to commit terrorist acts by any means, directly or indirectly,

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unlawfully and willfully, (b) participates as a principal or as an accomplice in terrorist acts, (c) organizes or directs others to commit terrorist acts, or (d) contributes to the commission of terrorist acts by a group of persons acting with a common purpose where the contribution is made intentionally and with the aim of furthering the terrorist act or with the knowledge of the intention of the group to commit a terrorist acts. (Rule 3.a.11 of RIRR of RA 10168)

28. Terrorist acts refer to the following: (Rule 3.a.12 of RIRR of RA 10168)

a. Any act of violation of Section 3 or Section 4 of the Human Security Act of 2007,

b. Any other act intended to cause death or serious bodily injury to a civilian, or to any other person not taking an active part in the hostilities in a situation of armed conflict, when the purpose of such act, by its nature or context, is to intimidate a population, or to compel a government or an international organization to do or to abstain from doing any act,

c. Any act which constitutes an offense under this Act, that is within the scope of any of the following treaties of which Republic of the Philippines is a State party:

Convention for the Suppression of Unlawful Seizure of Aircraft, done at The Hague on 16 December 1970,

Convention for the Suppression of Unlawful Acts against the Safely of Civil Aviation, done at Montreal on 23 September 1971,

Convention on the Prevention and Punishment of Crimes against Internationally Protected Persons, including Diplomatic Agent adopted by the General Assembly of the United Nations on 14 December 1973,

International Convention against the taking of Hostages, adopted by the General Assembly of the United Nations on 17 December 1979,

Convention on the Physical Protection of Nuclear Material, adopted at Vienna on 3 March 1980,

Protocol for the Suppression of Unlawful Acts of Violence at Airports

Serving International Civil Aviation, supplementary to the Convention for the Suppression of Unlawful Acts against the

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Safety of Civil Aviation. Done at Montreal on 24 February 1988,

Convention for the Suppression of Unlawful Acts against the Safety of Maritime Navigation, done at Rome on 10 March 1988,

Protocol for the Suppression of Unlawful Acts against the Safety of Fixed Platforms located on the Continental Shelf, done at Rome on 10 March 1988, or

International Convention for the Suppression of Terrorist Bombings, adopted by the General Assembly of the United Nations on 15 December 1997.

29. Terrorist Organization, Association or Group of Persons refers to any entity

owned or controlled by any terrorist or group of terrorists that: (Rule 3.a.13 of RIRR of RA 10168)

a. Commits, or attempts to commit, terrorist acts by any means,

directly or indirectly, unlawfully and willfully, b. Participates as an accomplice in terrorist acts, c. Organizes or directs others to commit terrorist acts, d. Contributes to the commission of terrorist acts by a group of

persons acting with common purpose or furthering the terrorist acts where the contribution is made intentionally and with the aim of furthering the terrorist acts or with the knowledge of the intention of the group to commit terrorist acts.

30. Shell Company refers to legal entity which has no business substance in its own right but through which financial transactions may be conducted. E. STAGES OF MONEY LAUNDERING

The Financial Action Task Force (FATF) is the multinational body that sets the global tone for AML efforts. Formed in 1989, it is based in Paris. The Financial Action Task Force (FATF) has a three-part working definition. The three stages of money laundering: Placement, Layering, and Integration are basically defined below:

1. PLACEMENT – involves physically placing illegally obtained money into the financial system or the retail economy. "Dirty" money is most vulnerable to detection and seizure during placement.

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2. LAYERING – means separating the illegally obtained money from its source through a series of financial transactions that makes it difficult to trace the origin. During the layering phase of money laundering, criminals often take advantage of legitimate financial mechanisms in attempts to hide the source of their funds. A few of the many mechanisms that may be misused during layering are currency exchanges, wire transmitting services, prepaid cards that offer global access to cash via automated teller machines and goods at point of sale, casino services and domestic shell corporations lacking real assets and business activity that are set up to hold and move illicit funds.

3. INTEGRATION – means converting the illicit funds into a seemingly legitimate form. Integration may include the purchase of businesses, automobiles, real estate and other assets.

The three (3) basic steps may occur as separate and distinct phases. They may also occur simultaneously or, more commonly, may overlap. How the basic steps are used depends on the available laundering mechanism and requirements of the criminal organizations. Below are the typical examples of the transactions applying the three basic steps of money laundering:

Placement Stage Layering Stage Integration Stage

Split-up of large amounts of cash into less noticeable smaller amounts that are then deposited directly into a bank account

Purchase and sale of investment instruments

Investment in real estate, luxury assets or business ventures

Purchase of series of monetary instruments (e.g. checks and money orders) that are then collected and deposited into accounts at another location

Wire/fund transfer through a series of accounts at various banks across the globe (often using fictitious names or funds disguised as payments of goods or services)

False loan repayments or forged invoices used as cover for laundered money

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Cash purchase of single premium life insurance of other investment

F. REVIEW OF THE MANUAL

The Money Laundering and Terrorism Financing Prevention Program (MLPP) shall be regularly updated at least once every two years to incorporate changes in AML policies and procedures and latest trends in money laundering and terrorist financing typologies and latest pertinent BSP issuances. Subsequent amendments shall be uploaded in the system which shall be available for viewing and downloading to all business units for dissemination purposes.

All covered transactions shall prepare and have available for inspection an updated MLPP embodying the principles and provisions stated in these rules. The Compliance Officer shall submit to Anti-Money Laundering Specialist Group, Supervision and Examination Subsector I of the BSP a sworn certification that the revised MLPP has been prepared, duly noted and approved by the Board of Directors. (Section §X805.2.a BSP Circular No. 706, series of 2011).

CHAPTER 2 - AMLA AND TERRORISM FINANCING SUPPRESSION ACT REQUIREMENTS A. REQUIREMENTS UNDER THE AMLA OF 2001, AS AMENDED AND TERRORISM

FINANCING PREVENTION AND SUPPRESSION ACT OF 2012

The AMLA Republic Act No. (RA) 9160 as amended by RA 9194, RA 10167 (Annex A), RA 10365 (Annex H) and its IRR (Annex B/I) as well as the TF Suppression Act RA 10168 (Annex C) and its IRR (Annex D) provides the following: 1. Defines the circumstances, which constitutes the offense of money laundering

and provides penalties for the commission of the offense (Chapter 2.B of the MLPP)

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2. Requires banks, financial institutions and other institutions engaged in financial activities to establish the identity of their customers (Section 4.3 of the MLPP)

3. Requires banks, financial institutions and other institutions engaged in financial activities to retain all customer identification records of covered persons shall be maintained and safely stored as long as the account exists. All transaction records, including all unusual or suspicious patterns of account activity whether or not an STR was filed with the AMLC of covered institutions shall be maintained and safely stored for five (5) years from the date of transaction (X818 BSP Circular 706).

With respect to closed accounts, the records on customer identification, account files and business correspondences, shall be preserved and safely stored for at least five (5) years from the date of closure (X808.1 BSP Circular 706)

If a money laundering case based on any report kept by the covered institution concerned has been filed in court, said file must be retained beyond the five (5) year retention period and until it is confirmed that the case has been finally resolved or terminated by the court (X807.2 BSP Circular 706)

4. Imposes an obligations on banks, financial institutions and other institutions engaged in financial activities and their employees to report to the Anti-Money Laundering Council (AMLC) all covered transactions and suspicious transactions within ten (10) days from occurrence (knowledge) thereof (Section 5.2 of the MLPP)

5. Requires banks, financial institutions and other institutions to provide all their

responsible officers and personnel with efficient and effective training and continuing education programs to enable them to fully comply with all their obligations under the AMLA (Rule 17.d of RIRR of RA 9160, as amended by RA 9194, and RA 10167) and TF Suppression Act (Rule 25.b of the IRR of RA 10168)

6. Requires banks and/or relevant government agencies upon receipt of the

notice of freeze order to immediately preserve the subject property or funds and its related account in accordance the order of the AMLC (Rules 16.a and 16.b of the IRR of RA 10168)

7. Requires the banking institution or the non-bank financial institution and their

subsidiaries and affiliates to allow the AMLC and/or its authorized representatives full access to all records pertaining to the deposit or investment account, immediately upon receipt of the AMLC resolution authorizing the

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inquiry into or examination of any deposit or investment with such banking institution or non-bank financial institution and their subsidiaries and affiliates concerned (Rule 11.b.2 of the RIRR of RA 9160, as amended by RA 9194 and RA10167).

B. SANCTIONS AND PENALTIES FOR THE CRIME OF MONEY LAUNDERING AND TERRORISM FINANCING OFFENSES

OFFENSE SANCTIONS AND PENALTIES

CRIME OF MONEY LAUNDERING A person who, knowing that any monetary instrument or property represents, involves or relates to the proceeds of any unlawful activity: a. transacts said monetary

instrument or property,

b. converts, transfers, disposes of, moves, acquires, possesses or uses said monetary instrument or property,

c. conceals or disguises the true nature, source, location, disposition, movement or ownership of or rights with respect to said monetary instrument or property,

d. attempts or conspires to commit money laundering offenses referred to in paragraphs (a), (b) or (c),

Imprisonment ranging from seven (7) to fourteen (14) years and a fine of not less than Three million Philippine pesos (P3,000,000.00) but not more than twice the value of the monetary instrument or property involved in the offense.

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e. Aids, abets, assists in or counsels the commission of the money laundering offenses referred to in paragraphs (a), (b) or (c) above, and

f. performs or fails to perform any act as a result of which he facilitates the offense of money laundering referred to in paragraph (a), (b) or (c) above.

Imprisonment from four (4) to seven (7) years and a fine of not less than One million five hundred thousand Philippine pesos (P1,500,000.00) but not more than Three million Philippine pesos (P3,000,000.00)

A covered person, its directors, officers and personnel who knowingly participated in the commission of the crime of money laundering

Imprisonment ranging from six (6) months to four (4) to seven (7) years and a fine corresponding to of not less more than two hundred percent (200%) of the value of the monetary instrument or property laundered.

Failure to keep record Imprisonment from six (6) months to one (1) year or a fine of not less than P100,000.00 but not more than P500, 000.00 or both.

Malicious Reporting A person who, with malice or in bad faith, file completely unwarranted or false information relative to money laundering transaction.

Imprisonment from Six (6) months to four (4) years and a fine of not less than P100,000.00 but not more than P500,000.00 at the discretion of the Court provided that the offender is not entitled to avail the benefits of the Probation Law.

Refusal of a public official or employee to testify

Same penalties prescribed therein.

Where the offender in the foregoing is:

a. If the offender is a corporation, association, partnership of any

Penalty shall be imposed upon the responsible officers as the case maybe,

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juridical person

b. If the offender is a juridical person

c. If the offender is an alien

d. If the offender is a public official or employee

who participated in, or allowed, by their gross negligence, the commission of the crime The Court may suspend or revoke its license He shall, in addition to the penalties herein prescribed, be deported without further proceedings after serving the penalties herein prescribed He shall, in addition to the penalties prescribed herein, suffer perpetual or temporary absolute disqualification from office, as the case may be

Breach of Confidentiality Imprisonment ranging from three (3) to eight (8) years and a fine of not less than P500,000.00 but not more than P1,000,000.00 The concerned officer and employee of the covered person and media shall be held liable.

In case of Breach of Confidentiality that is published or reported

The responsible reporter, writer, president, publisher, manager and editor-in-chief shall be liable under this Act

Failure or willful refusal to permit the AMLC or its Secretariat’s duly authorized personnel to conduct an inquiry into or examination of any deposit or investment upon receipt of the AMLC resolution authorizing the same

Monetary penalty of not more than P500,000.00

Failure to implement freeze Order Imprisonment ranging from six (6) months to four (4) years and a fine of not less than P100,000.00 nor more

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than P500,000.00, at the discretion of the court without prejudice to the administrative sanction that AMLC may impose on the erring covered person.

Crime of Financing of Terrorism a. Any person who directly or

indirectly, willfully and without lawful excuse, possesses, provides, collects or uses property or funds or financial service or other related services, by any means, with the unlawful and willful intention that they should be used or with the knowledge that they are to be used in full or in part:

1. to carry out or facilitated the commission of any terrorist act

2. by a terrorist organization, association or group

3. or by an individual terrorist

b. Any person who organizes or directs others to commit financing of terrorism under the immediately preceding paragraph shall likewise be guilty of an offense and shall suffer the same penalty as herein prescribed.

c. Attempt to commit terrorism financing offense and dealing with property or funds of designated persons

Reclusion temporal in its maximum period to reclusion perpetua and a fine of not less than P500,000.00 nor more than P1,000,000.00 Penalty of two degrees lower (Prision correccional in its maximum period to prision mayor in its medium period) than that prescribed for the commission of the crime of financing terrorism

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d. Conspiracy to commit

terrorism financing offense and dealing with property or funds of designed persons

e. Accomplice to terrorism

financing offense

f. Accessory to terrorism financing offense

g. Dealings with property or

funds of designated persons When the offender in the foregoing is:

h. Offense committed by a Juridical Person, Corporate Body or Alien: 1. Offender is a corporation,

association, partnership or any juridical person

2. Offender is a juridical person

3. Offender is an alien

Same penalty for the commission of the crime of financing terrorism Penalty of one degree lower (Prision mayor in its maximum period to reclusion temporal in its medium period) than that prescribed for the conspirator Penalty of two degrees lower (Prision correccional in its maximum period to prision mayor in its medium period) than that prescribed for principals in the crime of financing terrorism Reclusion temporal in its maximum period to reclusion perpetua and a fine of not less than P500,000.00 nor more than P1,000,000.00 The penalty shall be imposed upon the responsible officers, as the case may be, who participated in, or allowed by their gross negligence, the commission of the crime or who shall have knowingly permitted or failed to prevent its commission The court may suspend or revoke its license He shall, in addition to the penalties herein prescribed, be deported without further proceedings after serving the penalties herein prescribed.

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Imposition of Administrative Sanctions (Rule 15.A of 2016 RIRR of RA 9160 as amended)

After due notice and hearing, the AMLC shall, at its discretion impose sanctions, including monetary penalties, warning or reprimand, upon any covered person, its directors, officers and employees, or any other person for the violation of AMLA and its IRII, or for failure or refusal to comply with AMLC orders, resolutions and other issuances. Such monetary penalties shall be in amounts as may be determined by the AMLC to be appropriate, which shall not be more than Five Hundred Thousand Pesos (P500,000.00) per violation. The imposition of the administrative sanctions shall be without prejudice to the filing of criminal charges against the persons responsible for the violations.

C. NON-DISCRIMINATION AGAINST CERTAIN TYPES OF CUSTOMERS

The provisions of the AMLA shall not be construed or implemented in a manner that will discriminate against certain customer types, such as PEP, as well as their relatives, or against certain religion, race or ethnic origin, or such other attributes or profiles when used as the only basis to deny these persons access to the services provided by the covered persons. Whenever a bank, or quasi-bank , financial institution or whenever any person or entity commits said discriminatory act, the person or persons responsible for such violation shall be subject to sanctions as may be deemed appropriate by their respective Supervising Authorities. (Rule 15.C of the 2016 RIRR of RA 9160 as amended).

D. MISTAKEN IDENTITY, SAFE HARBOR PROVISION

In case a freeze has been effected based on mistaken identity, no administrative, criminal or civil proceedings shall lie against any person or entity, including covered institutions and relevant government agencies, for effecting a freeze on the property or funds in the absence of bad faith, gross negligence or malice. No

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administrative, criminal or civil proceedings shall lie against any person for having made a CTR or an STR in the regular performance of his duties in good faith, whether or not such reporting results in any criminal prosecution under the AMLA, as amended, its RIRR or any other law.

E. EXEMPTION FROM BANK SECRECY LAWS

When reporting covered and suspicious transactions to LBP/AMLC, LBP Leasing and

Financing Corporation and their officers and employees shall not be deemed to

have violated RA 1405, as amended, RA 6426, as amended, RA 8791 and other

similar laws, but are prohibited from communicating directly or indirectly, in any

manner or by any means, to any person, the fact that a covered or suspicious

transaction report was made, the contents thereof, or any other information in

relation thereto. Neither may such reporting be published or aired in any manner

or form by the mass media, electronic mail, or other similar devices. In case of

violation thereof, the concerned officer and employee of LBP Leasing Corporation

shall be criminally liable in accordance with the provisions of the AMLA, as

amended.

CHAPTER 3: ORGANIZATIONAL STRUCTURE FOR AMLA COMPLIANCE

A. AUDIT COMMITTEE

The Board thru the Audit Committee shall perform functions as follows:

1. It shall oversee the implementation of the Corporation’s MLPP.

2. It shall ensure that AML Compliance issues are resolved expeditiously.

3. It shall assist the Board of Directors in making informed assessment as

to whether the Corporation is managing its AML Compliance risk

effectively.

4. It shall ensure that the Corporation’s MLPP shall be regularly updated at

least once every two years to incorporate changes in AML policies and

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procedures, latest trends in money laundering and terrorist financing

typologies, and latest pertinent laws and BSP issuances.

5. To perform such other functions as the Board of Directors may delegate

in relation to Internal Audit and Compliance issues.

B. MANAGEMENT COMMITTEE

The Management Committee shall perform functions as follows:

1. Ensure that the business is conducted in conformity with high ethical standards in order to protect its safety and soundness and integrity,

2. Adopt and implement a sound AML and terrorist financing risk management system,

3. Comply with rules and existing laws aimed at combating money laundering and terrorist financing,

4. “Know your customers” in transacting and maintaining a client, and 5. Effective implementation and enforcement of the AMLA, as amended,

and its RIRR. C. ANTI-MONEY LAUNDERING COMMITTEE

In order to ensure compliance with Anti-Money Laundering Act of 2001 (AMLA) under RA 9160, as amended by RA 9194, RA 10167, RA 10365 and its Revised Implementing Rules and Regulations (RIRR) including Terrorism Financing Prevention and Suppression Act of 2012 under RA 10168 and its Implementing Rules and Regulations (IRR), an Anti-Money Laundering Committee is hereby created composed of the following:

The Committee is hereby created composed of the following:

Chairman : President Vice Chair : Compliance Officer Members : Head of Legal Services

Head of Risk Management Head of Internal Audit

Secretariat : Compliance Office

The Committee shall have the following functions:

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1. To receive, investigate and evaluate reported suspicious transactions, money

laundering activities and other violations of the RA No. 9160 as amended by RA No. 9194, RA 10167, RA 10365 and its implementing rules and regulations (RIRR), RA 10168, The Terrorism Financing Prevention and Suppression Act of 2012 and its implementing rules and regulations (IRR), as well as the issuances of BSP, SEC and LBP and other subsequent issuances of pertinent laws and regulations and to determine if the activity or suspicion is based on reasonable grounds.

2. To ensure that the Corporation complies with the Anti-Money Laundering law

and Terrorism Financing and that all covered transactions are reported to the Anti-Money Laundering Council (AMLC) in accordance with the prescribed forms and procedures of this Manual.

3. To adopt money laundering and terrorist financing prevention programs and a

system of monitoring transactions.

4. To institute an effective dissemination of information on money laundering and terrorist financing activities, their prevention, detection and reporting and penalties and administrative sanctions for violations in AMLA.

D. COMPLIANCE OFFICE

Management of the implementation of the covered institution’s Money Laundering and Terrorist Financing Prevention Program (MLPP) shall be the primary task of the Compliance Office. To ensure the independence of the Compliance Office, it shall have a direct reporting line to the Board of Directors or any Board-level or approved committee on all matters related to AML and terrorist financing compliance and their risk management. The Compliance Office shall be principally responsible for the following functions amount other functions that may be delegated by Senior Management and the Board, to wit:

1. Ensure compliance by all responsible officers and employees with these Rules,

the AMLA, as amended, the RIRR and its own MLPP. It shall conduct periodic compliance checking which covers, among others, evaluation of existing processes, policies and procedures including on-going monitoring of performance by staff and officers involved in money laundering and terrorist

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financing prevention, reporting channels, effectivity of the electronic money laundering transaction monitoring system and record retention system through sample testing and review of audit or examination reports. The Compliance Officer shall also report compliance findings to the Board or any Board-level committee,

2. Ensure the infractions, discovered either by internally initiated audits or by other issuances by the BSP and the AMLC in relation to matters aimed at preventing money laundering and terrorist financing,

3. Inform all responsible officers and employees of all resolutions, circulars and other issuances by the BSP and the AMLC in relation to matters aimed at preventing money laundering and terrorist financing,

4. Alert senior management, the board of directors, or the Board-level or approved committee if it believes that the institution is failing to sensibly address anti-money laundering and terrorist financing issues,

5. Organize the timing and content of AML training of officers and employees including regular refresher trainings as stated in Section X809 of BSP Circular No. 706, series of 2011.

6. Monitoring of internal and external audit findings related to money laundering and terrorist financing.

7. Conduct periodic compliance testing to determine the adherence of responsible

units to the compliance action plan and sufficiency of implementation and compliance of concerned process owners on reported audit findings.

8. Establish a tracking system on the resolution of audit findings/ recommendations by Internal Auditor. This shall provide for periodic review and submission of status reports to concerned Unit Head and the Audit Committee.

9. Shall coordinate with unit heads all deficiencies noted under their respective units on the audit and/or BSP regular or special examination for immediate action. The Compliance Officer may assist the unit heads in determining the necessary corrective measures to address the noted audit/examination deficiencies. The corrective measures shall be elevated to the Audit Committee for evaluation and approval. The approved corrective measures must be implemented by the unit concerned within 60 calendar days from the date of

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its approval unless it may be justified, by providing an appropriate timetable, that a longer period is necessary for its implementation subject to the approval of the President.

The Compliance Officer shall be designated by the Board as the AML Compliance Officer. The AML Compliance Officer may be the liaison between LLFC, the BSP and the AMLC in matters relating to LLFC’s AML compliance.

E. BUSINESS UNITS

All employees of LLFC are responsible for AML compliance. The business units and their respective Heads will serve as the overall overseer of LLFC’s compliance to AMLA rules and regulations. The Unit Head shall perform the following functions: 1. Ensure that personnel/employees in their areas have undergone the proper

screening procedures, attended the required training programs and on a test bases, monitor transactions to determine if there are suspected money laundering activities,

2. Provide appropriate guidance on compliance issues. The Unit Head shall ensure that new regulatory issuance, policies, and procedural guidelines are disseminated and discussed in the monthly staff meetings of the units,

3. Help ensure that the new laws, rules, regulations policies and guidelines are appropriately disseminated and discussed by head of the represented business unit/s with all supervised responsible personnel,

4. Assist in the conduct of Compliance Risk Assessment (CRA) and preparation of business unit/s Compliance Action Plans,

5. Assist in the correction of compliance breaches, 6. Assist in the assessment of compliance training needs and recommend the

participation of personnel to trainings and seminars, 7. Provide inputs to the Compliance Program, and 8. Submit reports to the Compliance Officer, as prescribed by the Compliance

Manual. F. RISK MANAGEMENT UNIT

All covered institution shall develop sound risk management policies and practices:

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1. To ensure that risks associated with money-laundering such as counterparty, reputational, operational, and compliance risks are identified, assessed, monitored, mitigated and controlled,

2. To ensure effective implementation of laws, rules and regulations pertain to anti-money laundering and terrorist financing.

3. To ensure that covered institution shall not be used as a vehicle to legitimize proceeds of unlawful activity or to facilitate or finance terrorism

The Risk Management Officer integrates the Compliance Risk Management in the overall Risk Management Strategy of LLFC.

G. INTERNAL AUDIT UNIT

LLFC’s Internal Audit unit shall establish and implement internal control procedures aimed at preventing and impeding money laundering and terrorism financing. Such procedures shall among other things, ensure that such intermediaries and their employees are aware of the provisions of the law, its implementing rules and regulations, as well as all reportorial and compliance control procedures that shall be established by the Supervising Authority, AMLC and the Corporation. The Internal Audit shall be responsible for the periodic and independent evaluation of the risk management, degree of adherence to internal control mechanisms related to customer identification process, such as the determination of the existence of customers and completeness of the minimum information and/or documents establishing the true and full identity, CT, ST reporting and record keeping and retention, as well as the adequacy and effectiveness of other existing internal controls associated with money laundering and terrorist financing.

The results of internal audit shall be timely communicated to the Board of Directors

and shall be open for scrutiny by BSP examiners in the course of the regular or

special examination without prejudice to the conduct of its own evaluation

whenever necessary.

Results of the audit shall likewise be promptly communicated to the Compliance

Officer for its appropriate corrective action. The Compliance Officer shall regularly

submit reports to the Board to inform them of management’s action to address

deficiencies noted in the audit.

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CHAPTER 4: PREVENTIVE MEASURES

A. GENERAL GUIDELINES

Section 4.1. LLFC shall maintain system of verifying the true identity of their clients and, in case of corporate and juridical entities, require a system of verifying their legal existence and organizational structure as well as the authority and identification of all persons purporting to act on their behalf. Along this line, LLFC shall formulate a risk-based and tiered customer acceptance policy, customer retention policy and customer identification process that involves reduced Customer Due Diligence (CDD) for potentially low risk clients and enhanced CDD for higher risk accounts. (Annex J – LLFC Guidelines on Customer Acceptance and Identification, Risk Classification, Risk Assessment and Application of Due Diligence)

B. CUSTOMER ACCEPTANCE POLICY

Section 4.2. LLFC shall develop clear, written and graduated acceptance policies and procedures that will ensure that the financially or socially disadvantaged are not denied access to financial services while at the same time prevent suspicious individuals or entities from opening an account.

The following factors shall be taken into account in the

customer acceptance policy:

1. Background and source of funds, 2. Country of origin and residence of operations, 3. Public or high profile position of the customer or its

directors/trustees, stockholders, officers and/or authorized signatory,

4. Linked accounts, 5. Watch list of individuals and entities engaged in illegal

activities or terrorist related activities as circularized by BSP, AMLC, and other international entities or organizations such as the Office of Foreign Assets

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Control (OFAC) of the US Department of Treasury and United Nations Sanctions List,

6. Business activities, and 7. Type of services/products/transactions to be entered

with LLFC. C. CUSTOMER IDENTIFICATION

Section 4.3. Know Your Customer (KYC) measures of LLFC shall include conducting continuing due diligence on the business relationship to ensure that the transactions being conducted are consistent the Corporation’s knowledge of the customer and/or beneficial owner, their business profile, including, where necessary, the source of its funds. LLFC shall specify the criteria and description of the types of customers that are likely to pose low, normal or high risk to their operations as well as the standards in applying reduced, average and enhanced due diligence including a set of conditions for the denial of the account.

LLFC shall conduct a Face-to-Face Contact at the

commencement of the relationship, or as reasonably practicable so as not to interrupt the normal conduct of business, taking into account the nature of the product, type of business and the risks involved; provided that money laundering risks are effectively managed.

The use of Information and Communication Technolodgy in

the conduct of face-to-face contact may be allowed, provided that the covered person is in possession of and has verified the identification documents submitted by the prospective client prior to the interview and that the entire procedure is documented. (Rule 9.1a of the 2016 RIRR of RA 9160, as amended).

Section 4.4. Satisfactory evidence of the true and full identity,

representative capacity, domicile, legal capacity, occupation or business purposes of clients, as well as other identifying information on those clients, whether they be occasional or usual, shall be obtained through the use of customer information and documents.

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Section 4.5. Clients should be made aware of the explicit policy that

business transactions will not be conducted with applicants who fail to provide evidence of their identity. Where initial checks fail to identify the applicant, or give rise to suspicions that the information provided is false, additional verification measures should be undertaken to determine whether to precede with the business. Details of the additional verifications are to be recorded in writing and will be made available for inspection of SEC or appropriate authorities.

Section 4.6. LLFC shall ensure that all customers are known well, and,

accordingly, shall keep current and accurate all material information with respect to the customers by regularly conducting verifications and an update thereof. Signature cards and personal data forms of existing customers should be updated at least once every three years, except in case of government accounts and whenever it is expressly provided in the design of the program for a particular financial product.

Section 4.7. LLFC shall pay attention to unusually large transactions or

unusual patterns of transactions. This shall apply both to the establishment of a business relationship and to on-going due diligence. The Corporation shall examine the background and purpose of such transactions, the findings and results thereof will be established in writing and will be made available to help competent authorities.

Section 4.8. When the Corporation acquires the business of another

financial sector company or covered institution either in whole or as a product portfolio, it is not necessary for the identity of all existing customers to be re-identified, provided that:

i. all customer account records are acquired with the

business, and ii. Due diligence inquiries do not raise any doubt as to

whether the anti-money laundering procedures previously adopted by the acquired business have satisfied Philippine requirements.

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Section 4.9. If during the business relationship, the Corporation has

reason to doubt:

i. the accuracy of the information relating to the customer’s identity,

ii. that the customer is the beneficial owner, or iii. the intermediary’s declaration of beneficial

ownership, or iv. if there are any signs of unreported changes,

Further measures shall be taken to verify the identity of the customer or the beneficial owner, as applicable shall be taken. Such measures may include the following:

a. referral of names and other identifying information to

criminal investigating authorities b. review of disciplinary history and disclosure of past

relevant sanctions

Section 4.10. The Corporation shall maintain accounts only in the name of the actual client. No anonymous accounts, fictitious names accounts, incorrect name accounts and similar accounts should be accepted.

D. CUSTOMER PROFILING

Section 4.11. LLFC shall develop clear, written and graduated customer

acceptance policies and procedures, including a set of criteria for customers that are likely to pose low, normal or high risk to their operations. The criteria may include the following:

a. The nature of the service or product to be availed of b. The purpose of the account or transaction c. The amount of funds or the size of transaction

undertaken d. The regularity or duration of the transaction e. The fact that a customer came from a high risk

jurisdiction

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f. The existence of suspicious transaction indicators g. Such other factors covered person may deem

reasonable or necessary to consider in assessing the risk of the customer to money laundering.

LLFC shall set standards in applying the reduced, normal and enhanced customer due diligence, including a set of conditions for the denial of the account.

Customer Due Diligence – covered persons shall establish and record the true identity of LLFC clients based on official documents, as defined in Rule 3.M of the 2016 RIRR of RA 9160, as amended. LLFC shall maintain a system of verifying the true identity of LLFC clients based on reliable, independent source, documents, data, or information. In case of corporate clients, covered persons are required to maintain a system of verifying their legal existence and organizational structure, as well as the authority and identification of all persons purporting to act on their behalf. LLFC shall establish appropriate systems and methods, and adequate internal controls, compliant with AMLA and its RIRR, other issuances, the guidelines issued by the Supervising Authorities, and internationally accepted anti-money laundering standards, for verifying and recording the true and full identity of the customers.

In conducting customer due diligence, a risk-based approach shall be undertaken depending on the type of customer, business relationship, or nature of the product, transaction or activity. In all instances, LLFC shall document how a specific customer/client was profiled and what standard of CDD was applied.

Section 4.12. Enhanced Due Diligence maybe applied to customers if it

acquires information in the course of its customer account or transaction monitoring that:

1. Raises doubt as to the accuracy of any information or document provider or the ownership of the entity,

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2. Justifies re-classification of the customer from low risk to high-risk pursuant to these BSP rules or by its own criteria, or

3. Any circumstance for the filing of a suspicious transaction exist such as but not limited to the following:

i. Transacting without legal underlying legal or trade obligation, purpose or economic justification,

ii. Transacting an amount that is not commensurate with the business or financial capacity of the customer or deviates from his profile,

iii. Structuring of transactions in order to avoid being the subject of covered transaction reporting, or

iv. Knowing that a customer was or is engaged or engaging in any unlawful activity as herein defined.

Section 4.13. Whenever enhanced due diligence is applied, LLFC shall, in

addition to profiling of customers and monitoring of their transactions, do the following:

1. Obtain additional information other than the

minimum information and/or documents required for the conduct of average diligence enumerated in Section 4.13 of MLPP,

a. In cases of individual customers, obtain a list of

banks where the individual has maintained or is maintaining an account, list of companies where he is a director, officer or stockholder, and banking services availed of.

b. For entities assessed as high risk customers, such as shell companies, LLFC shall, in addition to the minimum information and/or documents enumerated above, obtain additional information including but not limited to prior or existing bank references, the Name, present address, date and

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place of birth, nature of work, nationality and source of funds of each of the primary officers (President, Treasury and authorized signatory/ies) stockholders owning at least 2% of the voting stock, and directors/trustee/partners as well as their respective identification documents.

2. Conduct validation procedures on any or all of the information provided,

3. Obtain senior management approval for establishing or continuing (for existing clients) such business relationship,

4. Take reasonable measures to establish the source of wealth and sources of funds,

5. Conduct enhanced ongoing monitoring of the business relationship.

Section 4.14. Where additional information cannot be obtained, or any

information or document provided is false or falsified, or result of the validation process is unsatisfactory, LLFC shall deny or terminate financing relationship with the individual or entity without prejudice to the reporting of a suspicious transaction to the AMLC when circumstances warrant.

Section 4.15. The minimum validation procedures for individual customers

shall include but not limited to the following:

i. Confirming the date of birth from a duly authenticated official document,

ii. Verifying the permanent address through evaluation of utility bill, bank or credit card statement or other document showing permanent address or through on-site visitation,

iii. Contacting the customer by phone, email or letter, and

iv. Determining the authenticity of the identification documents through validation of its issuance by

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requesting a certification from the issuing authority or by other means.

Section 4.16. For corporate or juridical entities, validation procedures shall

include but is not limited to the following:

i. Requiring submission of audited financial statements conducted a reputable accounting/auditing firm,

ii. Inquiring from the supervising authority the status of the entity,

iii. Obtaining bank references, iv. On-site visitation of the company, and v. Contacting the entity by phone, email or letter (such

as “thank you letters”) E. PERSONAL/INDIVIDUAL CUSTOMERS

Section 4.17. The following information shall be obtained from all personal applicants:

name (last name, first name, middle name)

present address

permanent address

mother’s maiden name

name of spouse, if any

mailing address

date and place of birth

nationality

nature of work, name of employer or nature of self-employment of business

tax identification numbers, Social Security number of Government Service and Insurance System number

nature of business

specimen signature

sources of funds

contact numbers

information on the name of beneficiary/ies (if applicable)

Section 4.18. Applicants who present only photocopies of identifications

and other documents shall be required to produce the

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original documents for verification purposes. Prospective clients should be interviewed personally to verify personal and business circumstances.

Section 4.19. Prospective clients should be interviewed personally to verify

personal and business circumstances. Section 4.20. LLFC shall pay special attention to money laundering threats

that may arise from new and developing technologies that might favor anonymity and take measures, if needed, to prevent their use in anti-money laundering schemes

F. HIGH RISK CUSTOMERS

Section 4.21. LLFC shall give special attention to business relationships and transactions with persons, including companies and financial institutions, from countries which do not or insufficiently apply the FATF Recommendations. Whenever these transactions have no apparent economic or visible lawful purpose, their background and purpose should as much as possible be examined, the findings established in writing and be available to help competent authorities. Where such a country continues not to apply or insufficiently applies FATF Recommendations, countries should be able to apply appropriate countermeasures.

Section 4.22. Customers from countries that do not have or insufficiently

apply anti-money laundering measures are considered higher risk customers. LLFC will establish the source of wealth of higher risk customers. Decisions on business relation with higher risk customers shall be taken by the Senior Management.

G. SOLE PROPRIETORSHIPS, CORPORATIONS, STOCK OR NON-STOCK AND

PARTNERSHIPS

Section 4.23. Before establishing a business relationship, a company search and/or other commercial inquiries shall be made to ensure that the corporate/other business applicant has not been, or is not in the process of being dissolved, struck off,

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wound up or terminated. In the event of doubt as to the identity of the company or its directors, or the business or its partners, a search or inquiry with the Commission or the relevant Supervising Authority/Regulatory Agency shall be made.

Section 4.24. The following relevant documents and information shall be

obtained with respect to corporate and other business applicants who are regulated in the Philippines:

Copies of the Certificate of Registration issued by the Department of Trade and Industry, for single proprietors, or by the Securities and Exchange Commission, for corporations and partnerships, including the Articles of Incorporation or Certificate of Partnership, as appropriate, copies of the By-Laws of the corporation,

Latest General Information Sheet, which lists the names of the directors/trustees/partners and principal stockholders,

Secondary licenses, if any,

Other documents such as but not limited to clearance/certification from the Commission that the company is active and compliant with the reportorial requirements,

Sworn statement as to existence or non-existence of beneficial owners.

Appropriate board resolutions and signed application forms containing specimen signatures

Where necessary, additional information may also be required about the nature of the business of clients, copied of identification documents of shareholders, directors, officers and all authorized signatories

The type of measures that would normally be needed to satisfactorily perform identification of beneficial owners would require identifying the natural persons with a controlling interest and identifying the natural persons who comprise the management of the legal person or arrangement.

Where the customer or owner of the controlling interest is public company that is subject to regulatory disclosure

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requirements, it is not necessary to seek to identify and verify the identity of any shareholder of that company. The originals or certified copies of any or all of the foregoing documents, where required, should be produced for verification.

Section 4.25. For companies, businesses or partnerships registered outside

the Philippines, comparable documents are to be obtained, duly authenticated by the Philippine Consulate where said entities are located.

Section 4.26. If significant changes to the company structure or ownership

occur subsequently, or suspicions arise as a result of a change in the payment profile as reflected in a company account, further checks are to be made on the identities of the new owners.

Section 4.27. If significant changes to the company structure or ownership

occur subsequently, or suspicions are aroused by a change in the payment profile through a company account, further checks are to be made on the identities of the new owners.

H. SHELL COMPANIES

Section 4.28. Shell companies are legal entities which have no business substance in their own right but through which financial transactions may be conducted. LLFC shall take note that shell companies may be abused by money launderers and therefore the Corporation shall be cautious in their dealings with them.

Section 4.29. The Corporation shall also obtain a Board of Director’s

certification as to purpose of the owners/stockholders in acquiring Shell Company. There must also be satisfactory evidence of the identities of the beneficial owners, bearing in mind the “Know-Your-Customer” principle.

I. TRUST, NOMINEE AND FIDUCIARY ACCOUNTS

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Section 4.30. LLFC shall establish whether the applicant for business relationship is acting on behalf of another person as a trustee, nominee or agent. The Corporation shall obtain competent evidence of the identity of such agents and authorized signatories, and the nature of their trustee or nominee capacity and duties.

Section 4.31. Inquiries to verify status of business relationships between

parties shall be immediately done whenever LLFC doubts as to whether the trustee, nominee or agent is being used as a dummy in circumvention of existing laws. If satisfactory evidence of the beneficial owners cannot be obtained, the Corporation shall consider whether to proceed with the business bearing in mind the KYC principle. Should the Corporation decide to precede, records of any misgivings and extra attention in monitoring the account in question shall be performed.

J. TRANSACTIONS UNDERTAKEN ON BEHALF OF CLIENT OR CLIENT COMPANIES

Section 4.32. Where transactions are undertaken on behalf of client or client companies, particular care shall be taken to ensure that the person giving instructions is authorized to do so. An authorization by the client shall be required.

Section 4.33. Transactions undertaken for non-account holders demand

special care and vigilance. Where the transaction involves significant amounts, the customer will be asked to produce competent evidence of identity including nationality, especially cases where the client is not a Filipino, the purposes of the transaction, and the sources of the funds.

K. POLITICALLY EXPOSED PERSON (PEP)

Section 4.34. LLFC shall take reasonable measures to determine whether a customer or beneficial owner is PEP as defined in this manual. In case the customer or beneficial owner is identified as PEP, LLFC shall apply Enhanced Due Diligence.

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The requirements for all types of PEPs should also apply to family members or close associates of such PEPs.

Family Members of PEP refer to spouse or relative within the

first degree of consanguinity or affinity, or relative by legal

adoption of the PEP.

Close Associates of PEP refer to publicly known close

associates of PEPs, boyfriend, girlfriend, personal secretary,

business partner, and other persons with similar relationship

with the PEP.

L. ON-GOING MONITORING OF CUSTOMERS AND TRANSACTIONS

Section 4.35. LLFC shall, on the basis of materiality and risk, update all

customer information and identification documents of

existing customers required to be obtained under the

AMLA, the RIRR, other AMLC issuances and guidelines

issued by the Supervising Authorities at least once every

three (3) years, unless enhanced on-going monitoring is

warranted.

CHAPTER 5 - REPORTING REQUIREMENTS AND PROCEDURES

Section 5.1. LLFC shall institute a system for the reporting of covered transactions and suspicious transactions.

Section 5.2. All covered/suspicious transactions shall be reported to

AMLC within five (5) working days from occurrence thereof, unless the supervising authority concerned prescribes a longer period not exceeding ten (10) working days. In the case of LLFC, all covered/suspicious transactions shall be reported to LBP through their AMLDes within two (2) banking days from which the transaction occurred. LBP will consolidate the reports and shall be responsible in transmitting the report to AMLC.

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Section 5.3. All covered transactions shall be reported using the form as

prescribed by the LBP and AMLC.

Section 5.4. Should a transaction be determined to be both a covered and a suspicious transaction, it shall be reported as a suspicious transaction.

Section 5.5. Using the Suspicious Transaction (STR) form as prescribed by

the AMLC, the employee who dealt directly with the customer in the transaction shall file and sign the report and submit the same to the Head of Unit concerned.

Section 5.6. LLFC shall maintain a register of all suspicious transactions

that have been brought to the attention of the Compliance Officer, including transactions that are not reported to the AMLC.

Section 5.7. LLFC shall maintain a register of all covered transactions

which are not reported to the AMLC pursuant to AMPLC Resolution No. 292, Series of 2003.

Section 5.8. The registers shall contain details of the date on which the

report is made, the person who made the report to the Compliance Officer, and information sufficient to identify the relevant papers related to the said reports.

Section 5.9. The Head of Unit shall evaluate the report. If the Head of the

Unit is of the opinion that there is reasonable basis for the suspicion, he/she shall prepare the corresponding memorandum. The STR shall be attached to the memorandum and forwarded immediately to the Compliance Officer.

Section 5.10. Upon receipt of the memorandum/STR, the Compliance

Officer shall convene a meeting of the Anti-Money Laundering Committee to evaluate the report and determine if the transaction/suspicion is based on reasonable grounds.

Section 5.11. If the Anti-Money Laundering (AML) Committee decides that

there is reasonable basis for considering a suspicious/illegal

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activity, the STR shall be approved for filing with the AMLC and signed by the Compliance Officer and the President or his duly authorized representative in his absence.

Section 5.12. Covered Transaction Reports and Suspicious Transaction

Reports shall be submitted in a secured manner to the AMLC in electronic form, either via diskettes, leased lines, or through internet facilities, with the corresponding hard copy for suspicious transactions.

Section 5.13. When reporting covered transactions or suspicious

transactions to LBP/AMLC, the Corporation and their officers, employees, representatives, advisors or consultants are prohibited from communicating directly or indirectly, in any manner or any means, to any person or entity or the media, the fact that a covered transaction report was made, the contents thereof, or any other information in relation thereto. Neither may such reporting be published or aired in any manner or form by the mass media, electronic mail, or other similar devices. In case of violation hereof, the concerned officer, employee, representative, agent, advisor, consultant or associate of the covered institution, or media shall be held criminally liable.

Section 5.14. No administrative, criminal or civil proceedings shall lie

against any person for having made a suspicious or covered transaction report in the regular performance of his duties and in good faith, whether or not such reporting results in any criminal prosecution under the AMLA or any other Philippine law. LLFC, its directors and employees shall likewise not be liable for any loss arising to such disclosure, or any act or omission, in relation to the fund, property or investment in consequence of the disclosure, where such is made in good faith and in the regular performance of their duties under the Act.

Section 5.15. The Compliance Officer shall prepare an annual certification

that LLFC has monitored the compliance to existing anti-money laundering regulations. This certification shall be signed by the Compliance Officer and the President for

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submission to the AMLC within twenty (20) banking days after the end of each reference year.

CHAPTER 6 - RECORD KEEPING AND RETENTION

Section 6.1. LLFC shall prepare and maintain documentation on its customer relationships and transactions such that:

a. Requirements of RA No. 9160 as amended by RA No.

9194, RA 10167, RA 10365 and RA 10168, and its implementing rules and regulations are fully met,

b. Any transaction effected can be reconstructed and from which the AMLC will be able to compile an audit trail for suspected money laundering, when such a report is made to wit,

c. Any inquiry or order from the AMLC as to disclosure

of information, including without limitation whether a particular person is the customer or beneficial owner of transactions can be satisfied within a reasonable time.

Section 6.2. The following document retention periods shall be followed:

a. All customer identification records shall be maintained and safely stored as long as the account exists (Section 808 BSP Circular 706).

b. All transaction records, including all unusual or

suspicious patterns of account activity

whether or not an STR was filed with the

AMLC, of covered institutions shall be

maintained and safely stored for five years

from the date of transaction (Section 808 BSP

Circular 706).

With respect to closed accounts, the records on customer identification, account files and business correspondences,

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shall be preserved and safely stored for at least five years from the date of closure (Section 808.1 BSP Circular 706).

Section 6.3. Transaction documents may be retained as originals or copies, on microfilm, or in electronic form, provided that such forms are admissible in court, pursuant to the Revised Rules of Court and the E-Commerce Act and its Implementing Guidelines.

Section 6.4. Notwithstanding Section 6.2 hereof, if the records relate to

on-going investigations or transactions that have been the subject of a disclosure, they shall be retained beyond the stipulated retention period until it is confirmed that the case has been closed and terminated.

Section 6.5. The Account Management Group (AMG), Account Servicing

Group (ASG) and Customer Services Group (CSG) shall each maintain client and supplier records. At least two personnel from the respective groups shall be

designated by the Group Heads as jointly responsible and

accountable in the safekeeping of all records and documents

required to be retained under AMLA, as amended, its RIRR,

and BSP Circular 706. They shall have the obligation to make

these documents and records readily available without delay

during BSP regular or special examinations.

Section 6.6. If the records relate to on-going investigations or

transactions that have been the subject of a disclosure, they shall be retained beyond the stipulated retention period until it is confirmed that the case has been closed.

CHAPTER 7 – TRAINING PROGRAM

Section 7.1. LLFC shall formulate an annual AML training program aimed at providing all its responsible officers and personnel with efficient, adequate and continuous education program to

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enable them to fully and consistently comply with all their obligations under these Rules, the AMLA, as amended, and its RIRR.

Section 7.2. Trainings of officers and employees shall include awareness

of their respective duties and responsibilities under the MLPP particularly in relation to the customer identification process, record keeping requirements and CT and ST reporting and ample understanding of the internal processes is including the chain of command for the reporting and investigation of suspicious and money laundering activities.

Section 7.3. The program design will comprise of various focuses for new

staff, front-line stall, compliance office staff, internal audit staff, officers, senior management, directors and stockholders. Regular refresher trainings shall likewise be provided in order to guarantee that officers and staff are informed of new developments and issuances related to the prevention of money laundering and terrorism financing as well as reminded of their respective responsibilities vis-à-vis the covered institutions’ processes, policies and procedures.

Section 7.4. Covered institution’s annual AML training program and

records of all AML seminars and trainings conducted by the covered institution and /or attended by its personnel (internal or external), including copies of AML seminar/training materials, shall be appropriately kept the compliance office/unit/department, and should be made available during period or special BSP examination.

CHAPTER 8 - ANTI-MONEY LAUNDERING PROGRAMS

Section 8.1. The Internal Audit Group shall establish an internal audit system and audit program to determine the adequacy and effectiveness of LLFC’s risk management, governance and control processes related to Money Laundering and Terrorist Financing Prevention Program.

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The Internal Audit unit shall establish written internal reporting procedures which shall:

a. Enable all the directors, officers, employees, and key

staff to know to whom they should report any knowledge or suspicion of money laundering activity,

b. Ensure that there is a clear reporting chain under which suspicions of money laundering activity will be passed to the Compliance Officer, in accordance with the reporting procedures of LLFC,

c. Require the Compliance Officer to consider any reporting the light of all relevant information available for the purpose of determining whether or not it gives rise to a knowledge or suspicion of money laundering,

d. Ensure that the Compliance Officer has reasonable access to any other information which may be of assistance in the determination as to whether or not a suspicious transaction report is to be filed,

e. Require that, upon determination of the suspicious nature of the report, the information contained therein is disclosed promptly to the AMLC,

f. Maintain a register of all reports pursuant to Section 5.7, 5.8 and 5.14.

Section 8.3. Findings, observations or issues related to money laundering

and terrorist financing prevention shall form part of the final report issued by the Internal Auditor to the Audit Committee and Senior Management within thirty (30) days after the end of the Final exit conference. The Internal Auditor shall endorse such noted findings, observations or issues to the Compliance Officer immediately after the issuance of the audit report for monitoring of appropriate corrective action.

The report shall be open for scrutiny by BSP examiners in the course of the regular and special examination without prejudice to the conduct of its own evaluation whenever necessary.

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Section 8.4 BSP Circular No. 706 mandates that all covered institutions shall develop sound risk management policies and practices to ensure risks associated with money laundering and terrorist financing are identified, assessed, monitored, mitigated and controlled.

The anti-money laundering guidelines of LLFC shall include, but not limited to, the following:

a. Details, policies and procedures in implementing provision of Customer Due Diligence, considering risk-based approach;

b. Red Flag indicators that engender a reasonable belief that a money laundering offense is about to be, is being, or has been committed;

c. System/procedures of flagging and monitoring transactions that qualify as suspicious or covered transactions;

d. Guidelines to determine whether a customer or beneficial owner is a PEP;

e. Policies on identification, assessment, management and mitigation of money laundering risks that may arise from the development of new products and businesses;

f. AML compliance examination, including access to pertinent records and information.

In this regard, the Compliance Office shall conduct Anti-Money Laundering Compliance Testing (ACT) Program that aims to establish and to implement strategies and best practices to test the AML compliance of LLFC and management of AML risks embedded in the day-to-day operations.

The coverage of AML Compliance Testing shall include:

a. Customer Identification b. Covered Transaction Reporting c. Suspicious Transaction Reporting d. Review and monitoring of Accounts and transactions e. Record-keeping and Retention

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f. AMLA Training of Personnel

CHAPTER 9 - AUTHORITY TO INQUIRE ON BANK DEPOSITS AND FREEZE ORDER

Section 9.1. Bank inquiry with Court Order- Notwithstanding the provision of the RA 1405, as amended; RA 6426, as amended; RA 8791, and other laws, the AMLC may inquire into or examine any particular deposit or investment account, including related accounts, with any banking institution or non-bank financial institution upon order by the Court of Appeals based on an ex parte application in cases of violation of the AMLA when it has been established that a probable cause exists that the deposits or investments involved, including related accounts are in any way related to an unlawful activity or a money laundering offense.

Section 9.2. Bank Inquiry without Court Order – The AMLC may issue a

resolution authorizing the AMLC Secretariat to inquire into or examine any particular deposit or investment account, including related accounts, with any banking institution or non-bank financial institution and their subsidiaries and affiliates when it has been established that probable cause exists that said deposits or accounts are in any way related to any of the unlawful activities enumerated in Chapter 1 of this MLPP.

Section 9.3. Duties of LLFC Upon Receipt of Bank Inquiry Order LLFC

shall immediately give the AMLC and/or its Secretariat full access to all information, documents or objects pertaining to the deposit, investment, account and/or transaction. Certified copies of the documents pertaining to the inquiry shall be submitted to the AMLC Secretariat within five (5) working days from receipt of the court order or AMLC Resolution

Section 9.4. Freeze Order – Upon verified ex parte petition by the AMLC

and after determination that probable cause exists that any money instrument or property is in any way related to an

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unlawful activity, the Court of Appeals may issue a freeze order, which shall be effective immediately, directing the concerned covered persons and government agency to desist from allowing any transaction, withdrawal, transfer, removal, conversion, concealment, or other disposition of the subject monetary instrument or property.

Section 9.5. Effectivity of Freeze Oder shall be immediately and shall not

exceed six (6) months depending upon the circumstances of the case. On motion of the AMLC filed before the expiration of the original period of the freeze order, the court may, for good cause shown, extend its effectivity.

CHAPTER 10 - ANNEXES

Annex A Republic Act No. 10167 Annex B Revised Implementing Rules and Regulations of RA

9160, as amended by RA 9194 and RA 10167 (RIRR) Annex C Republic Act No. 10168 Annex D Implementing Rules and Regulations of

Republic Act No. 10168 Annex E BSP Circular No. 706, series of 2011 Annex F LLC Organizational Chart Annex G Internal Audit Program on MLPP Annex H Republic Act No. 10365 Annex I 2016 Revised Implementing Rules and Regulations of

Republic Act No. 9160, As Amended Annex J BSP Circular No. 950, series of 2017 Annex K LLFC Guidelines on Customer Acceptance and Identification, Risk Classification, Risk Assessment And Application of Due Diligence

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