BSP official calls for abolition of bank deposit secrecy laws

A central bank official has called for the repeal of the bank deposit secrecy laws, as the Philippines is now one of only two countries in the world – along with Lebanon – with such measures in place.

"I am for the repeal of these two laws," Bangko Sentral ng Pilipinas (BSP) Deputy Governor Vicente Aquino told reporters during the annual media lecture series of the central bank in Cebu City.

Aquino was referring to Republic Acts 1405 and 6426, which protect local and foreign currency deposits, respectively, from scrutiny. The laws were said to be among the strictest in the world, which at times have become impediments in pursuing criminal litigation.

"If repeal is not successful, at least there must be substantial amendments in order to show the world that we are internationally compliant with anti-money regulations. It is high time for us to do our part," Aquino said.

The amendments should give BSP the authority to look into the accounts of those involved in cases before a court of law, the central bank official noted.

Both laws state that bank deposits must be treated as confidential and may only be opened with a written consent from the account holder.

The success rate of prosecuting criminals is higher if government agencies have such authority, Aquino noted.

"Currently, examination of bank deposits are allowed only after the filing of cases before the courts," he said.

"If they have nothing to hide, then why object to the disclosure of their bank deposits?" he added.

The BSP has already sent the proposed amendments to both houses of Congress, including placing casinos and real estate agents under the purview of the Anti-Money Laundering Law.

To broaden the tax base

In a separate interview on national television Monday, the outgoing Bureau of Internal Revenue (BIR) Commissioner Kim Henares said that the bank secrecy law should be lifted to widen the tax base raise revenue collections.

"(T)he bank secrecy law, by lifting that alone, you would already raise P100 billion," she said.

"If we look up how many trillion pesos are there in the bank, those we cannot really see, and most of the people, especially not sophisticated people who are very rich, they put it in the banks so we cannot monitor.

"If we can monitor that, basically we will broaden the tax base because nobody can make it secret," she added. – VDS, GMA News