BSP releases monitoring guidelines on possible digital vote-buying

The Bangko Sentral ng Pilipinas (BSP) has released guidelines for its supervised financial institutions’s monitoring of possible vote-buying activities done through online banking and mobile wallet applications.

Commission on Elections (Comelec) Chairman George Garcia shared to reporters a copy of BSP Memorandum No. M-2023-30 issued last October 10 and signed by BSP Deputy Governor Chuchi Fonacier.

“To mitigate the heightened risk of the possible use or misuse of digital channels (i.e., online banking, mobile wallet applications) in vote-buying/selling activities, [BSP-supervised financial institutions (BSFIs)] should reinforce their measures and controls to ensure that appropriate customer onboarding processes, effective farug management system (FMS) and ongoing account and transaction monitoring capabilities are commensurate to respond to these fraudulent activities,” the memorandum read.

The BSP told the BSFIs to consider the following possible scenarios in calibrating their FMS and account and transaction monitoring rules and parameters:

• Concentration and/or significant number of account registrations in the area or locality where vote-buying/selling is identified to be rampant,
• Large cash transactions during election period,
• Unusual transaction flows between accounts, including the velocity and frequency of transactions (i.e, may-to-one, one-to-many),
• Unusual volume and/or value in cash in/cash out channels (agents).

The BSP cited Section 922 of the Manual of Regulations for Banks/Section 922Q of the Manual of Regulations for Non-Bank Financial Institutions, in relation to Section 3 (b-1) and Section 9 (c ) of the Anti-Money Laundering Act of 2001 as amended, and Section 1, Rule 3 and Rule 22 of its 2018 Implementing Rules and Regulations.

Under these rules, the BSP said BSFIs should submit suspicious transaction reports to the Anti-Money Laundering Council, when warranted, after due investigation of complex, unusually large transactions, unusual patterns of transactions, which have no underlying legal/trade obligation, purpose or economic justification, or the amount involved is not commensurate with the business or financial profile of the client and other transactions that may be considered suspicious.

The memorandum was issued “in line with the national government and the Commission on Election’s efforts to curb vote-buying and vote-selling, especially in the upcoming Synchronized Barangay and Sangguniang Kabataan Elections.”

“[T]he BSP strongly calls for the adoption of enhanced surveillance and monitoring measures to prevent the misuse of the financial institutions as conduits for this illegal activity. BSFIs are likewise urged to tighten their existing controls in detecting or preventing the possible influx of fraudulent accounts and transactions as the election date approaches,” the memorandum further read.

Prior to the October 30 BSKE, the Comelec has created the Committee on Kontra Bigay which is tasked to investigate and file cases against individuals involved in vote-buying and vote-selling.

This committee evolved from the 2022 national and local elections’ Task Force Kontra-Bigay.

So far, the committee against vote-buying has filed disqualification petitions against five BSKE candidates.

Vote-buying and vote-selling are considered as an election offense under Section 261 of the Omnibus Election Code.

Any person found guilty of election offense shall be punished with imprisonment of not less than one year but not more than six years.

Also, those found guilty will be denied the right to vote and prohibited from holding public office, and any political party found guilty of vote-buying will be fined.—AOL, GMA Integrated News