Remedial Measures to Address Deficiencies and Weaknesses Observed by World Bank/Asia Pacific Group Assessment Team

July 24, 2009 AMLCS-OED NO. 09-288 (2) Hon. Napoleon L. Morales Commissioner Bureau of Customs G/F OCOM Bldg., BOC, Port Area Manila City Dear Commissioner Morales : The Philippines was recently evaluated by a joint World Bank/Asia Pacific Group (APG) Assessment Team. One of the key findings noted by the Assessment Team in its Detailed Assessment Report (DAR) is the weak implementation by Philippine customs authorities of the cross border reporting requirement and the capacity to discover cash couriers, i.e., the statistics on currency declarations showed only the data from the Ninoy Aquino International Airport (NAIA) and no data at all from other international airports and seaports in the Philippines. Incidentally, we invited your agency to send a representative to the APG Plenary Meeting which was held in Brisbane, Australia on July 6-10, 2009. However, no representative from your agency participated in said meeting. During this Plenary Meeting, the Philippine DAR was discussed, including the aforesaid key findings. In view thereof, we recommend the following remedial measures to address the aforesaid deficiencies and weaknesses observed by the Assessment Team: 1. to require all district collectors of the Bureau of Customs (BOC) in all international airports and seaport within the Philippines ( i.e., Manila, Laoag, Cebu-Mactan, and Davao) to submit the foreign currency declarations of all outgoing and incoming passengers on a regular basis and in a timely manner to the Anti-Money Laundering Council (AMLC), pursuant to the Memorandum of Agreement for the Effective Implementation of BSP Rules on Physical Cross-border Transport of Currencies dated 17 January 2005 and its Supplemental Memorandum dated 20 December 2006; and 2. to submit these foreign currency declarations electronically to the AMLC, if possible. We, thus, request a meeting with the Commissioner and his agency's Anti-Money Laundering Desk head, preferably between July 27-31, 2009, to discuss the aforementioned concerns. Thank you for your continuing support in the fight against money laundering and terrorist financing. Very truly yours, (SGD.) VICENTE S. AQUINO Executive Director