AUDIT TO DETECT FRAUD AND CORRUPTION: EVALUATION OF THE FIGHT AGAINST CORRUPTION AND MONEY...
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Transcript of AUDIT TO DETECT FRAUD AND CORRUPTION: EVALUATION OF THE FIGHT AGAINST CORRUPTION AND MONEY...
AUDIT TO DETECT FRAUD AND CORRUPTION:
EVALUATION OF THE FIGHT AGAINST CORRUPTION AND MONEY
LAUNDERING
Atty. ALEXANDER B. JULIANODirector – Fraud Audit Office
Commission on Audit - Philippines
The 10th ASOSAI Research Project
Assessment of Current Situation of Corruption
and Money Laundering in the Philippines
Respondents
Salient Features of the Anti-Money Laundering Act of the Philippines
•Criminalizes money laundering •Creates a financial intelligence unit•Imposes requirements on customer identification, record keeping and reporting of covered and suspicious transactions •Relaxes strict bank deposits secrecy laws •Provides for bank inquiry and freeze ex parte petition/seizure/forfeiture/recovery of dirty money/property •Provides for international cooperation
Mandate of the Ombudsman
THE OMBUDSMAN AND HIS DEPUTIES, as protectors of the people shall act promptly on complaints filed in any form or manner against officers or employees of the Government, and enforce their administrative, civil and criminal liability in every case where the evidence warrants in order to promote efficient service by the Government to the people (Section 13, R.A. No. 6770; see also Section 12 Article XI of the 1987 Constitution).
The Ombudsman shall give priority to complaints filed against high ranking government officials and/or those occupying supervisory positions, complaints involving grave offenses as well as complaints involving large sums of money and/or properties (Sec. 15, R.A. No. 6770)
SURVEY RESULT
S
Anti-Money Laundering
Council
Field Investigation Office I & II
Preliminary Investigation,
Administrative Adjudication &
Monitoring Office
Public Assistance & Corruption
Prevention Office
Deputy Ombudsman for
Mindanao
· Low /
· Moderate /
·
Moderate and widespread among some public sectors / / /
·
Serious and pervasive in most or all sectors
· Other (Please specify)……………..
CURRENT PREVALENCE OF CORRUPTION IS MODERATE AND WIDESPREAD AMONG SOME PUBLIC SECTORS (60%)
Anti-Money Laundering Council
Field Investigation Office I & II
Preliminary Investigation,
Administrative Adjudication &
Monitoring Office
Public Assistance & Corruption
Prevention Office
Deputy Ombudsman for
Mindanao · Much higher than
previously
· Slightly higher than previously
· About the same as previously
· Slightly lower than previously / / / /
· Much lower than previously /
· Other (Please specify)…..
THE CURRENT PREVALENCE OF CORRUPTION IS SLIGHTLY LOWER THAN PREVIOUS YEARS (80%)
RANKING IN TRANSPARENCY INTERNATIONAL’S-CORRUPTION PERCEPTION INDEX DOES NOT FAIRLY REFLECT THE REALITY OF CORRUPTION IN THE COUNTRY (80%)
· Yes /
· No / / / /
· Other (Please specify)……………
Anti-Money Laundering
Council Field Investigation
Office I & II
Preliminary Investigation,
Administrative Adjudication &
Monitoring Office
Public Assistance & Corruption Prevention
OfficeDeputy Ombudsman for
Mindanao
SCORE OF THE GLOBAL INTEGRITY INDEX DOES NOT FAIRLY REFLECT THE REALITY OF CORRUPTION IN THE COUNTRY (60%)
· Yes / /
· No / / /
· Other (Please specify)……………
Anti-Money Laundering
Council Field Investigation
Office I & II
Preliminary Investigation,
Administrative Adjudication &
Monitoring Office
Public Assistance & Corruption Prevention
OfficeDeputy Ombudsman for
Mindanao
THE COUNTRY’S POPULATION IS MODERATELY INTOLERANT TOWARDS CORRUPTION (60%)
Anti-Money Laundering
Council Field Investigation
Office I & II
Preliminary Investigation,
Administrative Adjudication &
Monitoring Office
Public Assistance & Corruption Prevention
OfficeDeputy Ombudsman for
Mindanao
· Tolerant towards corruption / /
·
Moderately intolerant towards corruption / / /
·
Strongly intolerant towards corruption
· Other (Please specify)…………..
THE STRENGTH OF STEPS TAKEN BY THE GOVERNMENT AGAINST CORRUPTION IS MODERATE TO STRONG (60:40)
Anti-Money Laundering
Council Field Investigation
Office I & II
Preliminary Investigation,
Administrative Adjudication &
Monitoring Office
Public Assistance & Corruption Prevention
OfficeDeputy Ombudsman for
Mindanao
· Weak
· Moderate / / /
· Strong / /
· Other (Please specify)…………….
THE PATTERN OF CORRUPTION DEALINGS IS MODERATELY PREDICTABLE (80%)
Anti-Money Laundering
Council Field Investigation
Office I & II
Preliminary Investigation,
Administrative Adjudication &
Monitoring Office
Public Assistance & Corruption
Prevention OfficeDeputy
Ombudsman for Mindanao
· Unpredictable
·
Unpredictable but benefitting few top leaders /
· Moderately predictable / / / /
·
Highly predictable and can be seen from certain pattern
·
Other (Please specify)…………….
CORRUPTION OCCURS EQUALLY IN THE PUBLIC AND PRIVATE SECTORS
Anti-Money Laundering
Council Field Investigation
Office I & II
Preliminary Investigation,
Administrative Adjudication &
Monitoring Office
Public Assistance & Corruption
Prevention OfficeDeputy
Ombudsman for Mindanao
· Mostly in public entities /
· Mostly in private entities /
·
Equally In public and privateentities / / /
· Other (Please specify)…………….
PREVALENCE OF GRAND CORRUPTION RANKS NO. 1, PETTY CORRUPTION NO. 2 AND CORRUPTION AT ENTERPRISE LEVEL NO. 3
Anti-Money Laundering
Council Field Investigation
Office I & II
Preliminary Investigation,
Administrative Adjudication &
Monitoring Office
Public Assistance & Corruption
Prevention OfficeDeputy
Ombudsman for Mindanao
· Petty corruption 2 1 1 2 2
·
Corruption at enterprise level 3 3 3 3 3
· Grand corruption 1 2 2 1 1
·
Other (Please specify)…………….
ranking was made on collective consideration of enumeration
THE PREVALENCE OF PETTY CORRUPTION IN THE COUNTRY IS MODERATE TO HIGH (60:40)
Anti-Money Laundering
Council Field Investigation
Office I & II
Preliminary Investigation,
Administrative Adjudication &
Monitoring Office
Public Assistance & Corruption Prevention
OfficeDeputy Ombudsman for
Mindanao
· Non-existent
· Low
· Moderate / / /
· High / /
· Other (Please specify)…………….
PEOPLE MOST LIKELY TO BE INVOLVED IN PETTY CORRUPTION ARE RANK AND FILE EMPLOYEES
Anti-Money Laundering
Council Field Investigation
Office I & II
Preliminary Investigation,
Administrative Adjudication &
Monitoring Office
Public Assistance & Corruption
Prevention OfficeDeputy
Ombudsman for Mindanao
· High-level management
·
Medium Management / Supervisors
/
· Rank and file employees / / / / /
· Public
/
· Other (Please specify)…………….
MAIN PATTERNS OF PETTY CORRUPTION IN THE COUNTRY
Anti-Money Laundering Council
Field Investigation Office I & II
Preliminary Investigation, Administrative Adjudication
& Monitoring Office
Public Assistance & Corruption Prevention
OfficeDeputy Ombudsman for
Mindanao
Directly requesting kickbacks/tokens in exchange for performing a job
Petty corruption occurs usually where there is face-to-face interaction between the public employee and the public and/or where documents are to be submitted for processing, signature or approval
Street corruption by enforcement officers
Direct and indirect solicitation of grease money
Front liner service providers are more exposed or prone to small scale corrupt practices
THE PREVALENCE OF GRAND CORRUPTION IN THE COUNTRY IS MODERATE (80%)
Anti-Money Laundering
Council Field Investigation
Office I & II
Preliminary Investigation,
Administrative Adjudication &
Monitoring Office
Public Assistance & Corruption Prevention
OfficeDeputy Ombudsman for
Mindanao
· Non-existent
· Low /
· Moderate / / / /
· High
· Other (Please specify)…………….
PERSONALITIES MOST LIKELY TO BE INVOLVED IN GRAND CORRUPTION ARE 1)ELECTED OFFICIALS AND THEIR FAVORITES 2) POWERFUL GOVERNMENT OFFICIALS 3) SPECIFIC BUSINESS INTEREST AND POLITICAL GROUPS
Anti-Money Laundering
Council Field Investigation
Office I & II
Preliminary Investigation,
Administrative Adjudication &
Monitoring Office
Public Assistance & Corruption
Prevention OfficeDeputy
Ombudsman for Mindanao
·
Elected officials and their personal favourites / / / /
· Powerful government officials / / /
· Business entrepreneurs
· Specific business interests
and/or political groups /
· Other (Please specify)…………….
THE MOST COMMON TYPES OF CORRUPTION IN THE COUNTRY ARE 1)ABUSE OF POSITION/POWER 2) BRIBERY 3) 4) KICKBACK AND 5) EMBEZZLEMENT
Anti-Money Laundering
Council Field Investigation
Office I & II
Preliminary Investigation,
Administrative Adjudication &
Monitoring Office
Public Assistance & Corruption Prevention
OfficeDeputy Ombudsman for
Mindanao · Abuse of position/power 2 1 1 1 2
· Bribery 1 2 5 3 3
· Criminal breach of trust 7 8 6 9 5 · Extortion 6 3 7 7 6
· Embezzlement 4 4 8 2 1
· Forgery 9 5 9 6 8
· Influence peddling 8 6 2 5 7
· Kickback 3 7 3 4 4
· Nepotism 5 9 4 8 9
· Other (Please specify)……………
The approximate average monetary value where such corruption has an identifiable monetary value
1 = Less than USD50,0002 = Between USD50,000 – USD100,0003 = Between USD100,000 – USD500,0004 = Between USD500,000 – USD1,000,0005 = More than USD1,000,000
Anti-Money Laundering
Council Field Investigation
Office I & II
Preliminary Investigation,
Administrative Adjudication &
Monitoring Office
Public Assistance & Corruption Prevention
OfficeDeputy Ombudsman for
Mindanao · Type of corruption rank No.1 : 5 1 2 5 1
· Type of corruption rank No.2 : 5 1 1 3 2
· Type of corruption rank No.3 : 5 2 2 2
·
Agriculture 9 4 8 12 11
·
Customs 1 1 2 3 1
·
Education 8 5 11 11 7
·
Energy 10 10 10 9 9
· Environment 13 11 6 8 8
· Health 11 12 9 13 13
· Legislature 12 13 3 4 3
· Judiciary 6 6 7 10 12
· Law Enforcement/police 5 2 5 6 5
· Local government/Municipalities
7 3 4 2 4
· Public service delivery 4 7 12 1 6
· State-owned enterprise 2 9 13 7 10
· Taxation 3 8 1 5 2
· Other (Please specify)..............
Anti-Money Laundering
Council Field Investigation
Office I & II
Preliminary Investigation,
Administrative Adjudication &
Monitoring Office
Public Assistance & Corruption
Prevention OfficeDeputy
Ombudsman for Mindanao
THE SECTORS MOST VULNERABLE TO CORRUPTION ARE 1)CUSTOMS 2) TAXATION 3) LOCAL GOVERNMENT UNITS 4) LAW ENFORCEMENT/POLICE, AND 5)PUBLIC SERVICE DELIVERY
Anti-Money Laundering Council
Field Investigation Office I & II
Preliminary Investigation,
Administrative Adjudication &
Monitoring Office
Public Assistance & Corruption
Prevention Office
Deputy Ombudsman for
Mindanao
· Procurement contracts 2 4 3 1 1
· Electoral irregularities 3 3 5 4 4
· Revenue (Taxes) collection 4 1 2 2 2
· Public fund disbursement
procedures 1 2 1 3 3
· Licensing 5 5 4 5 5
· Other (Please specify)…………….
CORRUPTION HAS THE GREATEST PROBABILITY OF OCCURRING IN 1)PUBLIC FUND DISBURSEMENT 2) PROCUREMENT CONTRACTS, TAXATION, REVENUE COLLECTION, 3) ELECTORAL SYSTEM AND 4)LICENSING
Anti-Money Laundering Council
Field Investigation Office I & II
Preliminary Investigation,
Administrative Adjudication &
Monitoring Office
Public Assistance & Corruption
Prevention Office
Deputy Ombudsman for
Mindanao
· Acquiring assets 2 1 1 1 1
· Bank deposits 1 2 2 2 3
· Investing in real estate 3 4 5 3 2
· Leisure, social activities 5 3 3 4 4
· Stock investment 4 5 4 5 5
· Other (Please specify)……………. Gambling/vices
MONIES AND ASSETS GAINED FROM CORRUPTION MOST OFTEN USED FOR 1)ACQUIRING ASSETS 2)BANK DEPOSITS 3) REAL ESTATE INVESTMENT 4) LEISURE/GAMBLING 5) STOCK INVESTMENT
Anti-Money Laundering Council
Field Investigation Office I & II
Preliminary Investigation,
Administrative Adjudication &
Monitoring Office
Public Assistance & Corruption
Prevention Office
Deputy Ombudsman for
Mindanao
· Absence, weaknesses or failure
in regulatory and legal systems to combat corruption
1 4 6 3 1
· Complicated and cumbersome
administrative procedures 2 3 5 4 2
· Culture, customs and habits of
giving bribes to get things done 3 5 1 1 5
· Low salary levels
4 1 2 5 4
· Lack of financial rules and procedures
7 6 8 6 3
· To become rich as quick as possible
6 7 3 7 7
· Rapid population and economic growth
8 8 4 8 6
· Unclear rules and loopholes for manipulation
5 2 7 2 8
· Other (Please specify)..............
THE ROOT CAUSE OF CORRUPTION IN THE COUNTRY ARE 1)ABSENCE/WEAKNESS/FAILURE OF REGULATORY AND LEGAL SYSTEM TO COMBAT CORRUPTION 2) CULTURE, CUSTOM AND HABITS AND 4) LOW SALARY
THE PATRONAGE-CLIENT SYSTEM IS THE MAIN CAUSE OF GRAND CORRUPTION AND PETTY CORRUPTION (60%)
Anti-Money Laundering
Council Field Investigation
Office I & II
Preliminary Investigation,
Administrative Adjudication &
Monitoring Office
Public Assistance & Corruption
Prevention OfficeDeputy
Ombudsman for Mindanao
· Strongly disagree / /
· Disagree
· Neither agree nor disagree
· Agree /
· Strongly agree / /
WEAK ACCOUNTING PRACTICES, INCLUDING LACK OF TIMELY FINANCIAL MANAGEMENT ARE CONDITIONS FAVORABLE FOR CORRUPTION (80%)
Anti-Money Laundering
Council Field Investigation
Office I & II
Preliminary Investigation,
Administrative Adjudication &
Monitoring Office
Public Assistance & Corruption
Prevention OfficeDeputy
Ombudsman for Mindanao
· Strongly disagree /
· Disagree
· Neither agree nor disagree
· Agree /
· Strongly agree / / /
MONITORING THE SITUATION OF CORRUPTION IN THE COUNTRY IS A HIGH PRIORITY (60%)
Anti-Money Laundering
Council Field Investigation
Office I & II
Preliminary Investigation,
Administrative Adjudication &
Monitoring Office
Public Assistance & Corruption
Prevention OfficeDeputy
Ombudsman for Mindanao
· Not a priority
· Low priority
· Medium priority /
· High Priority / / /
· Essential /
COMPLAINTS OF CORRUPTION OR FRAUD FROM THE PUBLIC IS A HIGH PRIORITY (100%)
Anti-Money Laundering
Council Field Investigation
Office I & II
Preliminary Investigation,
Administrative Adjudication &
Monitoring Office
Public Assistance & Corruption
Prevention OfficeDeputy
Ombudsman for Mindanao
· Not a priority
· Low priority
· Medium priority
· High Priority / / / / /
· Essential
EMPHASIZING THE ROLE OF WHISTLE BLOWER IN REPORTING CORRUPTION IS VERY IMPORTANT (60%)
Anti-Money Laundering
Council Field Investigation
Office I & II
Preliminary Investigation,
Administrative Adjudication &
Monitoring Office
Public Assistance & Corruption
Prevention OfficeDeputy
Ombudsman for Mindanao
· Not at all important
· Low importance
· Slightly important
· Neutral
· Moderately important /
· Very important / / /
· Extremely important /
WHISTLE BLOWING IS AN EFFECTIVE AVENUE TO LODGE COMPLAINTS OF CORRUPTION (80%)
Anti-Money Laundering
Council Field Investigation
Office I & II
Preliminary Investigation,
Administrative Adjudication &
Monitoring Office
Public Assistance & Corruption
Prevention OfficeDeputy
Ombudsman for Mindanao
· Not effective /
· Effective / / /
· Very effective /
· Other (Please specify)...............
THE DAMAGE THAT CORRUPTION CAUSES TO THE GOVERNMENT’S BUDGET IS VERY SERIOUS (60%)
Anti-Money Laundering
Council Field Investigation
Office I & II
Preliminary Investigation,
Administrative Adjudication &
Monitoring Office
Public Assistance & Corruption
Prevention OfficeDeputy
Ombudsman for Mindanao
· Not at all serious
· Somewhat serious /
· Serious
· Very serious / / /
· Extremely serious /
THE DAMAGE THAT CORRUPTION CAUSES TO THE PRIVATE SECTOR IS SERIOUS
Anti-Money Laundering
Council Field Investigation
Office I & II
Preliminary Investigation,
Administrative Adjudication &
Monitoring Office
Public Assistance & Corruption
Prevention OfficeDeputy
Ombudsman for Mindanao
· Not at all serious
· Somewhat serious /
· Serious / /
· Very serious /
· Extremely serious /
THE DAMAGE THAT CORRUPTION CAUSES TO CITIZENS IS VERY SERIOUS
Anti-Money Laundering
Council Field Investigation
Office I & II
Preliminary Investigation,
Administrative Adjudication &
Monitoring Office
Public Assistance & Corruption
Prevention OfficeDeputy
Ombudsman for Mindanao
· Not at all serious
· Somewhat serious /
· Serious /
· Very serious / /
· Extremely serious /
CORRUPTION DURING BUDGET FORMULATION IS PRIMARILY GRAND OR POLITICAL CORRUPTION AND IS INFLUENCED BY THE DISTRIBUTION OF BUDGETARY POWERS BETWEEN THE EXECUTIVE AND THE LEGISLATURE
Anti-Money Laundering
Council Field Investigation
Office I & II
Preliminary Investigation,
Administrative Adjudication &
Monitoring Office
Public Assistance & Corruption
Prevention OfficeDeputy
Ombudsman for Mindanao
· Strongly disagree /
· Disagree
· Neither agree nor disagree / /
· Agree
· Strongly agree / /
Unchecked and excessive executive discretion in the budget process tends to create opportunities for political corruption. Politician or senior level bureaucrats are able to provide subsidies or favorable tax treatments to favored citizen groups or allocate budget resources to projects areas based on political connection.
Anti-Money Laundering
Council Field Investigation
Office I & II
Preliminary Investigation,
Administrative Adjudication &
Monitoring Office
Public Assistance & Corruption
Prevention OfficeDeputy
Ombudsman for Mindanao
· Strongly disagree
· Disagree
· Neither agree nor disagree
· Agree / / /
· Strongly agree /
PUBLIC FINANCIAL MANAGEMENT SYSTEM WEAKNESS DURING BUDGET FORMULATION CAN INCREASE THE RISK OF ADMINISTRATIVE CORRUPTION DURING BUDGET EXECUTION.
Anti-Money Laundering
Council Field Investigation
Office I & II
Preliminary Investigation,
Administrative Adjudication &
Monitoring Office
Public Assistance & Corruption
Prevention OfficeDeputy
Ombudsman for Mindanao
· Strongly disagree
· Disagree
· Neither agree nor disagree
· Agree / / /
· Strongly agree /
MOST SIGNIFICANT INCIDENCES OF CORRUPTION (BOTH PETTY AND GRAND CORRUPTION) IN THE PAST 5 YEARS (2007-2012)
Anti-Money Laundering Council
Field Investigation Office I & II
Preliminary Investigation, Administrative Adjudication & Monitoring Office
Public Assistance & Corruption Prevention Office
Deputy Ombudsman for Mindanao
i. ………… smuggling of oil
violation of RA 3019 (Anti-Graft and Corrupt Practices Act)
NBN-ZTE deal ZTE
ii. ……….. use of
government funds for personal use
malversation
Military procurement (conversion of funds)
Gen. Ligot case
iii. ……… bribery in high places inlcuding the Office of the President
bribery
Police procurement PAGCOR
iv. .……… failure to render account
v. .…..…… plunder
THE USUAL STYLES OF FRAUD AND CORRUPTION
Anti-Money Laundering
Council Field Investigation
Office I & II
Preliminary Investigation, Administrative Adjudication &
Monitoring Office
Public Assistance & Corruption Prevention
OfficeDeputy Ombudsman for
Mindanao
none 1) Influence peddling to approve PPP projects through unsolicited proposals under BOT scheme 2) Conveyance of public funds through bogus foundations/NGO's
In public works, costs or prices are increased in order not to sacrifice quality and quantity both the excess amounts are divided accordingly. In Tax credit certificates scam, the value of the bus (among others) is doubled in order to increase the tax credit/claim from the government. Accordingly, increasing the percentage of share.
REMARKS ON THE PREVALENCE AND NATURE OF CORRUPTION IN COUNTRY
Anti-Money Laundering
Council Field Investigation
Office I & II
Preliminary Investigation, Administrative Adjudication &
Monitoring Office
Public Assistance & Corruption Prevention
OfficeDeputy Ombudsman for
Mindanao
none It is serious though improving.
Corruption among legislature is grandeous and assured for instance if you are a congressman and you received million a year (as pork barel) multiplied by three years (term) equals 20 Million. With an assured kickback ranging from 10% to 20%, the congressman received P21 Million to P42 Million as the case maybe.
Assessment Of Current Situation Of Money
Laundering
Anti-Money Laundering Council
Field Investigation Office I & II
Preliminary Investigation,
Administrative Adjudication &
Monitoring Office
Public Assistance & Corruption
Prevention Office
Deputy Ombudsman for
Mindanao
· Extremely serious
· Very serious /
· Serious / / / /
· Not serious
· Not at all serious
· Other (Please specify)…………….
MONEY LAUNDERING IN THE COUNTRY IS SERIOUS (80%)
Anti-Money Laundering Council
Field Investigation Office I & II
Preliminary Investigation,
Administrative Adjudication &
Monitoring Office
Public Assistance & Corruption
Prevention Office
Deputy Ombudsman for
Mindanao
· Strongly agree
· Partially agree / / / /
· Disagree
· Partially disagree
· Strongly disagree /
· Other (Please specify)…………….
RESPONDENTS PARTIALLY AGREE THAT MONEY LAUNDERING TENDS TO INCREASE IN RECENT YEARS (80%)
Anti-Money Laundering Council
Field Investigation Office I & II
Preliminary Investigation,
Administrative Adjudication &
Monitoring Office
Public Assistance & Corruption
Prevention Office
Deputy Ombudsman for
Mindanao
· Strongly agree / /
· Partially agree / / /
· Disagree
· Partially disagree
· Strongly disagree
· Other (Please specify)…………….
OVER THE YEARS, MONEY LAUNDERING TENDS TO BE MORE SOPHISTICATED (60:40)
Anti-Money Laundering Council
Field Investigation Office I & II
Preliminary Investigation,
Administrative Adjudication &
Monitoring Office
Public Assistance & Corruption
Prevention Office
Deputy Ombudsman for
Mindanao
· Corruptive practices through
money laundering mostly found in public entities
/
· Corruptive practices through
money laundering mostly observed in private sectors
/
· Both in public and private
entities / / /
· Other (Please specify)…………….
THE MAIN PATTERN OF MONEY LAUNDERING IS OBSERVED BOTH IN PUBLIC AND PRIVATE ENTITIES (60%)
Anti-Money Laundering Council
Field Investigation Office I & II
Preliminary Investigation,
Administrative Adjudication &
Monitoring Office
Public Assistance & Corruption
Prevention Office
Deputy Ombudsman for
Mindanao
· Real estate 2 4 2 4
· Finance, banking 1 3 1 1 1
· Trade 3 2 3 2
· Construction 4 1 4 3
· Other (Please specify)……………. drugs
THE FIELDS WHICH HAVE THE HIGHEST RISK OF MONEY LAUNDERING ARE 1)FINANCE/BANKING 2)TRADE 3)REAL ESTATE 4)CONSTRUCTION
Anti-Money Laundering Council
Field Investigation Office I & II
Preliminary Investigation,
Administrative Adjudication &
Monitoring Office
Public Assistance & Corruption
Prevention Office
Deputy Ombudsman for
Mindanao
· Business 4 2 5 2 5
· Cash transaction 5 1 3 4 1
· Casino 3 6 4 9 3
· Money exchange 8 3 2 7 2
Project 7 4 6 3 4
Real estate 2 5 7 5 7
Stock market 6 7 8 6 6
Through internet 9 9 9 8 8
Through financial institutions 1 8 1 1 9
· Other (Please specify)……………. 4 2 5 2 5
THE MOST COMMON METHOD OF MONEY LAUNDERING ARE 1) CASH TRANSACTION 2) BUSINESS 3) FINANCIAL INSTITUTIONS
Anti-Money Laundering Council
Field Investigation Office I & II
Preliminary Investigation,
Administrative Adjudication &
Monitoring Office
Public Assistance & Corruption
Prevention Office
Deputy Ombudsman for
Mindanao
· International economic
integrating / /
· Bank and financial institutions do not have suitable supervision/control system to anti money laundering
/ /
· Use of cash and illegal money
transfer is dominant / / /
· Legal system for anti money
laundering is not enough / / / /
· Other (Please specify)…………….
THE LEGAL SYSTEM FOR MONEY LAUNDERING IS NOT ENOUGH AND USE OF CASH AND ILLEGAL MONEY TRANSFER IS DOMINANT
Anti-Money Laundering Council
Field Investigation Office I & II
Preliminary Investigation,
Administrative Adjudication &
Monitoring Office
Public Assistance & Corruption
Prevention Office
Deputy Ombudsman for
Mindanao
· Embezzlement / / /
· Corruption / / ·
Production, buying and selling of illegal goods / /
· Terrorism / /
· Drugs / / / /
· Other (Please specify)…………….
DRUGS AND EMBEZZLEMENT ARE OFFENCES CLOSELY ASSOCIATED WITH MONEY LAUNDERING
THE TOP THREE OFFENCES:
Anti-Money Laundering Council
Field Investigation Office I & II
Preliminary Investigation,
Administrative Adjudication &
Monitoring Office
Public Assistance & Corruption
Prevention Office
Deputy Ombudsman for
Mindanao
1. Drugs Drugs Corruption Embezzlement Drugs
2. Corruption Corruption Embezzlement Corruption Terrorism
3. Embezzlement Embezzlement Drugs Terrorism Corruption
How would you rate the approximate average amount of monetary involved for the top three offences. (Please choose from the answers below)
1 = Less than USD10M
2 = Between USD10M - USD50M
3 = Between USD50M - USD100M
4 = More than USD100M
Anti-Money Laundering
Council Field Investigation
Office I & II
Preliminary Investigation,
Administrative Adjudication &
Monitoring Office
Public Assistance & Corruption
Prevention OfficeDeputy
Ombudsman for Mindanao ·
Offence rank No.1 : 1 2 1 2 1
· Offence rank No.2 : 2 1 1 2 2
· Offence rank No.3 : 3 1 1 2 3
Anti-Money Laundering Council
Field Investigation Office I & II
Preliminary Investigation,
Administrative Adjudication &
Monitoring Office
Public Assistance & Corruption
Prevention Office
Deputy Ombudsman for
Mindanao
· Avoiding prosecution / / /
· Becoming legitimate / / /
· Evading taxes / /
· Hiding illegally accumulated wealth / / /
· Increase profit / /
· Other (Please specify)…………….
THE MAIN REASON CRIMINALS LAUNDER MONEY INCLUDE THOSE ENUMERATED BELOW
Anti-Money Laundering Council
Field Investigation Office I & II
Preliminary Investigation,
Administrative Adjudication &
Monitoring Office
Public Assistance & Corruption
Prevention Office
Deputy Ombudsman for
Mindanao
· Increased crime and corruption / /
· Weakened financial institutions / /
· Compromised economy and private sector / / /
·
Negative impact on foreign investment / /
·Reduced government tax revenue and weakened government control over the economy
/ / /
· Damaged privatization efforts / /
· Other (Please specify)……………. all of the above
THE CONSEQUENCES OF MONEY LAUNDERING ARE THOSE ENUMERATED BELOW
Anti-Money Laundering Council
Field Investigation Office I & II
Preliminary Investigation,
Administrative Adjudication &
Monitoring Office
Public Assistance & Corruption
Prevention Office
Deputy Ombudsman for
Mindanao
· No consequences
· Not too serious /
· Serious /
· Very serious / /
· Extremely serious /
THE ECONOMIC AND SOCIAL CONSEQUENCES THAT MONEY LAUNDERING HAS CAUSED IS VERY SERIOUS
Anti-Money Laundering Council
Field Investigation Office I & II
Preliminary Investigation,
Administrative Adjudication &
Monitoring Office
Public Assistance & Corruption
Prevention Office
Deputy Ombudsman for
Mindanao
· No impact
· Not too serious /
· Serious / /
· Very serious / /
· Extremely serious
MONEY LAUNDERING HAS VERY SERIOUS NEGATIVE IMPACT ON NATIONAL SECURITY, INTERNATIONAL REPUTATION AND WEAKENS THE ECONOMY AS WELL AS ECONOMIC REFORM
THE MOST SIGNIFICANT INCIDENCES OF CORRUPTION THAT TOOK PLACE FROM 2007 TO 2012
Anti-Money Laundering Council
Field Investigation Office I & II
Preliminary Investigation, Administrative Adjudication &
Monitoring Office
Public Assistance & Corruption Prevention Office
Deputy Ombudsman for Mindanao
i. ………… smuggling
AFP/PNP coruption cases (eg. Garcia Case)
NBN-ZTE deal ZTE
ii. ………..
use of gov't funds for personal use
NBN_ZTE Deal (against former Pres. Arroyo)
Military Procurement
Gen. Ligot case
iii. ……… bribery in high places
PCSO Plunder Case (against former Pres. Arroyo)
Police Procurement
PAGCOR
THE USUAL STYLES OF MONEY LAUNDERING IN THE COUNTRY
Anti-Money Laundering
Council
Field Investigation Office I & II
Preliminary Investigation, Administrative Adjudication &
Monitoring Office
Public Assistance & Corruption Prevention
OfficeDeputy Ombudsman for
Mindanao
Money laundering also involves using, processing, concealing or disguising money or property to make it look that it came from legitimate sources
Buying the winning jackpot lotto ticket
Others asked relatives to look for OFW who sends money to their relative in the country. The relative received the dollar (etc) and text the name and amount/address and the launderer will deliver the money to the addressee in person or deposit in the account
A GENERAL ASSESSMENT OF MONEY LAUNDERING IN THE COUNTRY
Anti-Money Laundering
Council
Field Investigation Office I & II
Preliminary Investigation, Administrative Adjudication &
Monitoring Office
Public Assistance & Corruption Prevention
OfficeDeputy Ombudsman for
Mindanao
Criminals are increasingly becoming more savvy in concealing the proceeds of illegal activities. Various Media are now being used including technology
maybe crime Weak enforcement of the Law; very limited predicate offences
Money laundering is more common among drug lords/gambling lords/terrorists/smugglers and legislators/politicians