AMLC Executive Director Mel Georgie Racela. INQUIRER.net file photo / CATHY MIRANDA
MANILA, Philippines — Real estate is being used as a “vehicle” for money laundering, with several estate assets found to be related to financing terrorism and subjected to freeze orders, the Anti-Money Laundering Council (AMLC) said Wednesday.
AMLC executive director Mel Georgie Racela made this confirmation as he responded to the query of Senate Minority Leader Franklin Drilon on why the council wants to include real estate developers and brokers in the list of covered institutions under the Anti-Money Laundering Act of 2001 to be covered by AMLA amendments.
During a Senate hearing on the proposed amendments to AMLA, Racela said this is among the proposed measures that will address the “identified strategic deficiencies” in the anti-money laundering and counter-terrorism financing legal framework of the country.
Senate Minority Leader Franklin Drilon then asked Racela if AMLC believes that real estate transactions are being used in money laundering.
“Real estate industry is being used as a vehicle for money laundering, that is why do you want to include real estate transactions?” Drilon asked the AMLC official, who answered in the affirmative.
“There are several estate assets found to be related to terrorism financing which [are] the subject of existing freeze orders. So we confirm, Senator Drilon, that real estate vehicle is being used as a money-laundering scheme,” Racela said.
Drilon, however, proposed that the Registry of Deeds be required to report suspicious real estate transactions instead of making such transactions to be covered by the anti-money laundering law.
“Are you telling us that real estate transactions are used generally by money launderers in our country so that the transactions must be covered by the anti-money laundering law? And assuming so, isn’t the remedy to require the Registry of Deeds to report all suspicious transactions or transactions beyond the threshold amount rather than imposing an additional burden to real estate agents?” the lawmaker said.
For Drilon, following the suggestion of AMLC would only cause a burden in the real estate industry.
“Can you imagine the burden on this industry? I would repeat, we are not talking here about real estate brokers as institutions, you have thousands of real estate brokers, housewives, somebody in the family who, to earn extra income, would go into real estate brokering,” the senator said.
“Now, you will require these people to submit reports every time the threshold is reached and the threshold is P1 million. Wala na pong gagawin itong mga real estate agents kung hindi magreport sa AMLC (Real estate agents would no longer do anything else aside from reporting to AMLC),” he said.
He added that AMLC also might not be able to examine all these reports anyway.
“That is why I am suggesting that instead of imposing the burden on real estate agents, why not impose the burden on the registry of deeds who would be the depository of all of these?” Drilon said.