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AMLA1. Protect and preserve the integrity and confidentiality of bank accounts, to ensure he the Philippines shall not be used as a site for unlawful money laundering activities; and2. Pursue State's foreign policy to extend cooperation in tansnational investigations and prosecutions on money laundering activities.

Covered transactions:1. Treshold transactions 2. Suspicious transactions 1. No underlying legal or trade obligation, purpose oreconomic justification; 2. Client is not properly identified; 3. Amount involved not commensurate with client's business or financial capacity; 4. Based on all known circumstances, it may be perceived that client's transaction is structured in order to avoid being subject of reporting requirements; 5. Any circumstance relating to transaction obseved to deviate from client's profile and/or client's profile past transactions wih covered institutions; 6. Transactions is in any way related toan unlawful activity or offense under the act that is about to be, is being, or has been committed; 7. Similaror analogous transactions.

Covered institutions:1. Banks and other entities, their subsidiaries and affiliates, supervised/ regulated by BSP;2. Insurance companies and other entities, supervised/regulated by insurance commisioner;3. SEC supervised/ regulated entities.

Money laundering crime - is committed when the proceeds of an "unlawful activity" are transacted to make them appear to have originated from legitimate sources, by the following acts: 1. Transacting or attempting to transact, with monetary instrument or property knowing it represent/involves/relates to proceeds of any unlawful activity; 2. Facilitating money laundering referred to in item (a) above, by knowingly performing or failing to perform an act; 3. Failing to disclose and file report with AMLC of any monetary instrument or property as required under the law.

Unlawful activities:1. Kidnapping for ransom2. Drug trafficking3. Graft and corrupt practices4. Plunder5. Robbery and extortion6. Jueteng and masiao7. Piracy on the high seas8. Qualified theft9. Swindling10. Smuggling11. Violations of E-Commerce Act of 200012. Hijacking, destructivearson and murder including acts of terrorism against non-combatant and persons and similar targets13. Fraudulent practices under the Securities Regulation Code of 200014. Felonies or offenses of similar nature punishable under the penal laws of the countries.

Jurisdiction:*RTC: all cases of money laundering *SANDIGANBAYAN: public officers and other private persons in conspiracy with such public officers. Note: No money laundering case can be filed, nor can here be a freeze of account, against any candidate for public office during an election campaign.

Penalties and other consequences:1. Fines and imprisonment for conviction of money laundering offenses; 2. Civil and criminal forfeiture of monetary instrument or property for any money laundering offense; 3. Convicted offender to pay an amount equal to value of monetary instrument or property ordered forfeited when order of forfeiture cannot be affeted.

Freezing of account: The CA may issue a freeze order only 1.) Upon ex parte application of AMLC 2.) After the determination that probable cause exists that any monetary instrument or property is in any way realted to an "unlawful activit," which shall beeffective immediately, and for a period of 20 days unless extended by court.

AMLC: 1.may seek court order to inquire into or examine a particular deposit or investment with a banking or non-banking financial institution; 2. On its own, no court order required, in cases involving kidnapping, drug trafficking or terrorism. *Upon probable cause that the deposits or inveztments are in any way related to any unlawful activity or monel laundering offense.

Power of BSP: to ensure compliance of this act, BSP may inquire into or examine any deposit or investment with any banking institution on non-bank financial institution when he examination is made in the course of periodic or special examination.

Composition of AMLC:*BSP Governor, as AMLC Chairman*Insurance Commision Chairman*SEC Chairman

NEW CENTRAL BANK ACT It is the State's Central Monetary Authority mandated in the 1987 Constitution, which shall function and operate as an independent and accountable body corporate in the discharge of its mandated responsibilities concerning money, banking and credit.

Primary Objectives of BSP: 1. To maintain price stabiliy conducive to a balanced and sustainable growth of the economy;2. To promoteand maintain the monetary stability and convertibility of the peso; and3. To provide policy directions in areas of money, banking and credit, with supervision over operations of banks, and with regulatory powers over operations of finance companies, and non-bank financial institutions performing quasi-banking functions.

Note: BSP has authority to request from government offices and instrumentalities, GOCCs, data it requires for the proper discharge of its functions and responsibilities, with the power to issue subpoena for the production of books and records.

Roles of BSP:1. Banker of the government2. Represents the government with the IMF3. Represents the government with oher financial institutions4. Maintains the fiscal operations of the government

BSP Privileges and Prohibitions1. Tax exempted2. Exempted from Custom Duties3. BSP cannot engage in development banking and financing4. BSP shall phase out all fiscal agency functions, and transfer same to the DOF5. BSP shall within 5 years phase out its regulatory powers over finance companies without quasi-banking functions, and other institutions performing similar functions, the same to be assumed by the SEC.

MONETARY BOARD BSP powers and functions are exercised by Monetary Board, composed of 7 members appointed by the President of the Philippines for a term of 6 years: 1. Governor, as chairman 2. A member of the Cabinet designated by he President of the Philippines 3. 5 members who shall come from the private sector, all of whom shall serve full-time; * No member of the Board may be reappointed more than once. * In case of emergencies where time is insufficient to call a meeting of the Monetary Board, the Governor with the concurrence of 2 other members of the Board, may decide any matter, or take an action within he authority of the Board. * The Governor shall thereafter submit a report to the President and Congress within 72 hours after the action has been taken. At the soonest possible time, the Governor shall call a meeting of the Monetary Board to submit his for ratification.

Qualifications of the members of the Monetary Board:1. Must be a natural-born Filipino Citizens;2. Atleast 35 years of age, with the exception of the Governor, who should atleast be 40 years of age;3. Of good moral character, of unquestionable integrity, of known probity and patriotism; and4. With recognized competence in social and economic disciplines.

Powers and functions of the Governor:1. He shall be the head of a department, and his appointment shall be subject to the confirmation by he Commision on Appointments;2. He shall be BSP Chief Executive Officer;3. He shall be the principal representative of the Monetary Board and of BSP.

Disqualification/inhibition on Governor and Board members:1. Disqualified from being director, officer, employee, consultant, lawyer, agent or stockholder of any bank, quasi-bank or any other institution which is subject to BSP supervision, in which case, such membershall resign from, and divest himself of any and all interest in such institution before assumption of office;2. Those coming from private sectors shall not hold any other public office or public employment during their tenure;3. Cannot be connected directly with any multilateral banking or financial institution, or has a substantial interest in any private bank in the Philipines, within 1 year prior to his appointment;4. Cannot be employed in any such institution within 2 years aftsr expiration of his term, except when he serves as an official representative of the Government in such institution;5. Governor or full-time members shall limit their professional activities to those pertaining directly to their position with BSP, and may not accept those any other employment, whether public or private, renumerated or ad honorem, with the exception of positions in eleemosynary, civic, cultral or religious organizationsor whenever, by designation of the president, the Governor of full-time memeber is tasked to represent the interest of the Government;6. When any member with personal or pecuniary interes in any matter in Monetary Board agenda, he shall disclose his interest and shall retire from meeting when the matter is taken up.

Removal of Governor and Board Memebers: President may remove any member of the Board fod any of the following reasons:1. Subsequent disqualification;2. Physical or mental incapacity that he cannot properly discharge his duties and responsibilities and such incapacity has lasted for more than 6 months;3. Guily acts or operations, which are fraudulent or illegal character, or which are manifestly opposed to the aims and interest of a BSP; or4. No longer possessing qualifications specified in he act.

Responsibilities/ liabilities of BSP Officers and Employees:1. Those who willfully violate the act , or whose guilty of negligence, abuses of malfeasence or misfeasance, or fail to exercise extraordinary diligence in the performance of their duties, shall be held liable for any loss or injury suffered by BSP, or other banking institution as a result hereof.2. Similar responsibility shall apply to members, officers and employees of BSP for: 1. Disclosure of any confidential information, or any information on Monetary Board discussions or resolutions, or about confidential operations of BSP, unless the disclosure is in connection with the performance of official BSP functions, or is with prior authorization of Monetary Board or Governor; 2. Use of such information for personal gain, or to the detriment of the Government, BSP or third parties.

*BSP shall have supervision over, and conduct periodic or special examinations of, banking institutions and quasi-banks, including their subsidiaries and affiliates engaged in allied activities.*No restraining order or injunction shall be issued by the courts enjoining BSP from examining any institution subject to its supervision or examination unless it is plainly arbitrary and made in bad faith.*The sanction of closure would be imposed upon a bank by BSP even without notice and hearing -"close now, hear later" scheme*The refusal of any officer owner, agent, manager, director or officer-in-charge of any institution subjet to the supervision or examination by BSP to make reports or permit examination is criminally punishable under the act.

Prohibition on Bank Officers, Directors, Lawyers, Agents: BSP personnel are prohibited from:1. Being an officer, director, lawyer or agent, employee, consultantnor stockholder, directly on indirectly, of any institution, subject to BSP supervision or examination EXCEPT non-stock savings and loan associations and provident funds organized exclusively for the employees of BSP;2. Directly on indirectly requesting, or receiving any gift, present or pecuniary or material benefit for himself or another, from any institution subject to BSP supervision or examination;3. Revealing in any manner, except undef orders of the court, the Congress, or any Government offive or agency authorized by law, information relating to the condition or business of any such institution;4. Borrowing from any such institution unless 1.) adequately secured, and 2.) fully disclosed to Monetary Board.

Appointment of CONSERVATOR Whenever a bank or a quasi-bank is in:1.) A state of continuing inability; or2.) Unwillingness to maintain a condition of liquidity deemed adequate to protect the interest of depositors and creditors. The Monetary Board may:1.) Appoint a conservator to take charge, for a period not exceeding 1 year, of the assets, liabilities, and the management thereof;2. Reorganize the management;3. Collect monies and debts due said bank; and4. Exercise all powers necessary to restore its viability, with power to overrule or rebuke he actions of the previous management board of directors of the bank or quasi bank.

When is Conservatoship terminated?1. When the Monetray Board is satisfied that the institution can continue to operate on its own and the conservatorship is no longer necessary;2. Should the Monetary Board determine that the continuance in business of the institutionn would involve probable loss to its depositors or creditors, in which case proceedings for receivership and liquadation shall be pursued.

Proceedings in Receivership Whenever the Monetary Board find tbat a bank or quasi bank :1. Is unable to pay its liabilities as they become due in the ordinary course of business but shall not include inability to pay caused by extraordinary demands induced by financial panic in the banking community;2. Has sufficient realizable assets to meet its liabilities;3. Cannot continue in business wihout involving probable losses to its depositors or creditors; or 4. Has willfully violated a cease and desist order that has become final, involving acts or transactions which amount to fraud, or a dissipation of the assets of the institution; the Monetary Board may summarily and without need for prior hearing, forbid he institution from doing business in the Philippines, and designated by PDIC as receiver of fhe banking institution.

Functions and obligations of the receiver:1. Immediately gather and take charge of all assets and liabilities of the institution, administer the same for the benefit of its creditors;2. Exercise the general powers of a receiver;3. Determine as soon as possible, but not later than 90 days from takeover, whether the institution may be rehabilitated or otherwise place in such a condition so that it maybe permited to resume business wih safety to its depositors and creditors and the genral public. *Any determination of resumption of business shall be subject to the proir approval of the Monetary Hoard.

Liquidation - if the receiver determines that the institution cannot be rahabilitated or permitted to resume business, the Monetary Board shall notify in writing the Board of Directors of its findings, and direct the receiver to proceed with the liquadation of the institution.

GENERAL BANKING LAW State recognizes the vital role of the banks in providing an environment conducive to the sustained development of the national economy; and Fiduciary nature of banks that requires high standards of integrity and performance The State shall promote and maintain a stable and efficient banking and financial system that is globally competitive, dynamic and responsive to the demands of a dveloping economy. BANKING BUSINESS IS IMPRESSED WITH PUBLIC INTEREST.

Banks refer to entities engaged in the lending of funds obtained in the form of deposits, and classified as follows:1. Universal Banks;2. Commercial Banks;3. Thrift Banks: a. Savings and mortgage banks b. Stock savings and loan associations; c. Private development banks;4. Rural Banks5. Cooperative Banks 6. Islamic Banks

*No person or entity shall engage in nbanking operations or quasi banking operations wihout aufhority from the BSP. HOWEVER, an entity auhorized by BSP to perform universal or commercial banking functions shall likewise have the authority to engage in quasi banking functions.

Authority and powers of the BSP:1. Issuance of rules of conduct or standards of operation for uniform application to all institutions or funxtions covered;2. Conduct of examination to determine compliance with laws and regulations;3. Overseeing compliance with laws and regulations;4. Regular investigation to determine whether an institution is conducting its business on safe or sound basis;5. Inquiring into solvency and liquidity of the institution;6. Enforcing prompt corrective action.

Quasi bank- are entities engaged in borrowing of funds through issuance, endorsement or assignment with resource or acceptance of deposit substitutes for purposes of re-lending or purchasing of receivables and other obligations.

Organization of Banks: Monetary Board may authorize organization of a bank or quasi banks subject to the followig conditions:1. Entity is a stock corporation;2. Funds are obtained from the public, which shall mean 20 or more persons; and3. Minimum capital requirements prescribed byMonetary Board for each category of banks ard satisfied. * SEC shall not register articles of incorporation and/ or by-laws of any bank or any amendment thereto unless accompanied by a certificate of authority issued by he Monetary Board.

*No bank shall purchase or acquire shares of its capital stock or accept its own shares as a security for a loan except when authorized by Monetary Boar PROVIDED every case stock so purchase or acquired shall wihin 6months from time of its purchase or acquisition, sold or disposed of at a public or private sale.

*Foreign individual and non-bank corporations may own or control up to 40% of voting stock of domestic bank. Rule shall apply to Filipinos and domestic non-bank corporations. Percentage of foreign-owned voting stocks in a bank shall be determined by citizenship of indibidual stockholders in that bank. Citizenship of corporation which iss a stockholder in a bank shall follow the citizenship of controlling stockholders of the corporation, irrespectiveof placeof corporation.

BOARD OF DIRECTORS Threre shall be atleast 5, and a maximum of 15 members of Board of directors of a bank, 2 of whom shall be independent directors. *In case of bank merger or consolidation, number of diretors shall not exceed 21. *Non-Filipino citizens may become members of Board of Directors to extent of foreign equity participation. *Meetings of Board of Directors may be conducted through, but not limited to, teleconferencing and video conferencing.

Fit and proper rule - To maintain the quality of bank management and affirdna better protection to depositors and the public in gsneral, he Monetary board shall prescribe, oass uoon and review the qualifications and disqualification of individuals elected or appointed bank directors or offeicers and disqualify those found unfit. In determining whether individual is fit and proper to hold position of a director or officer, regard shall be given to his integrity, experience, education, training and competence.

*After due notice to the board of directors of the bank, Monetary Board may disqualify, suspend or remove any bank director or officer who commits or omits an act which render him unfit nfor the position

*Prohibition on public officials - Except as provided in Rural BanksAct, no appointive or elective public official, whether full time or part-time shall at the same time serve as an officer of a private bank, save in cases where such incident to financial assistance provided by the government or a government-owned or controlled corporation to the bank or unless otherwise provided undre existing laws.

*Universal or commercial banks may open branches or other offices within or outside the aphilippines upon prior approval of BS.P. A BANK AND ITS BRANCHES AND OFFICES SHALL BE TREATED AS 1 UNIT.

* Unless otherwise authorized by BSP in the interest of the banking public, all banks including their branches and offices shall transact business on all working days, Monday to Friday, for 6 hours a day. In addition, banks or any of their branches or offices may open for business on Saturdays, Sundays or Holidays for atleast 3 hours a day. However, banks which opt to open on days other than working days shall report to BSP the additional days which they or their branches or offices shall transact business.

*Any strike or lockouts involving banks, if unsettled nin 7 calendar days shall be reported by BSP to DOLE Secretary who assume jurisdiction over dispute or decide it or certify the same to NLRC for compulsory arbitration .HOWEVER, the President may intevene, at any time, and assume jurisdiction over such dispute in order to settle or terminate the same.Types of deposit:1. Time deposit2. Savings Deposit3. Demand deposits or current accounts.

*Single Borrowe'rs limit: Except as Monetary Board may otherwise prescribe fro reasons of national interest, total amount of loans, credit accomodations and guarantees that may be extended by a bank to any person, partnership, association,mcorporation or other entity shall at no time exceed 20% of the net worth of such bank. Unless Monetary Board prescribes oherwise, SBL may be increasedbyan additional 10% net worth, provided additional amount is supported adequately by trust receipts, shipping documents, warehouse feceipts or other similar documents.

*No dire3ctor of officer shall directly or indirectly, for himself or as representative or agent of others: 1. Borrow from such bank; nor 2. Shall become an guarantor , indorser or surety formloans from such bank to others; nor 3. In manner be an obligor or incur any contractual liability to the bank.EXCEPT: With a written approval of majority of all Directors of the bank, excluding director concerened.