The Anti-Money Laundering Act (AMLA) of the Philippines, originally codified as Republic Act (R.A.) No. 9160 and subsequently amended by R.A. Nos. 9194, 10167, 10365, 10927, and 11521, is a comprehensive legal framework targeting the crime of money laundering in the Philippines. One of the critical components of AMLA’s enforcement is identifying and understanding predicate crimes or unlawful activities, which serve as the basis for a money-laundering offense.

Definition of Money Laundering

Under AMLA, money laundering is defined as the process by which individuals or organizations attempt to disguise the origins of proceeds obtained from criminal activities. The law criminalizes actions that involve transacting, converting, transferring, disposing, moving, acquiring, possessing, using, or concealing money or property known or should have been known to be derived from unlawful activities.

Predicate Crimes/Unlawful Activities

A predicate crime, or unlawful activity, is any criminal offense that generates proceeds that could be laundered. In the Philippines, the Anti-Money Laundering Council (AMLC) oversees and enforces AMLA. The Council has identified specific crimes and offenses that qualify as predicate crimes under the AMLA, which means that the laundering of proceeds derived from these activities constitutes a punishable offense.

Enumerated Predicate Crimes under AMLA

Under the amendments to AMLA, a comprehensive list of offenses has been designated as predicate crimes. This list includes, but is not limited to:

Kidnapping for Ransom (R.A. No. 8353) – Kidnapping and serious illegal detention for the purpose of extorting ransom.
Drug Trafficking and Related Offenses (R.A. No. 9165) – Involvement in illegal drug trade or any related illegal drug activities.
Graft and Corruption (R.A. No. 3019, as amended) – Any form of corruption or graft involving government officials.
Plunder (R.A. No. 7080) – Accumulating wealth through corrupt practices, especially by government officials.
Robbery and Extortion – Any robbery or extortion offense committed to obtain proceeds that could be subject to laundering.
Jueteng and Masiao (Illegal Gambling) – Engaging in illegal gambling operations such as jueteng or masiao.
Piracy (Presidential Decree No. 532, as amended) – Acts of piracy committed within or outside Philippine territory.
Qualified Theft – Theft with aggravating circumstances, qualifying it as more severe.
Swindling (Estafa) (Revised Penal Code) – Deceptive practices or schemes intended to defraud others.
Smuggling – Importation or exportation of goods without proper customs declaration and approval.
Fraudulent Practices and Other Violations of the Securities Regulation Code of 2000 – Offenses involving securities fraud, insider trading, and manipulation.
Forgery and Counterfeiting – Producing counterfeit currency, securities, or other financial instruments.
Human Trafficking (R.A. No. 9208) – Engaging in trafficking of persons, especially minors or for sexual exploitation.
Environmental Crimes (e.g., R.A. No. 9147, Wildlife Resources Conservation Act) – Violations against the protection of wildlife, forestry, or marine resources.
Terrorism and Conspiracy to Commit Terrorism (R.A. No. 9372) – Engaging in acts of terrorism or conspiring to commit terrorism.
Financing of Terrorism (R.A. No. 10168) – Providing funds or resources intended for terrorist acts.
Violations of the Anti-Trafficking in Persons Act of 2003 – Related offenses involving trafficking in persons, especially vulnerable individuals.
Cybercrime Offenses (R.A. No. 10175) – Including but not limited to fraud, identity theft, and cybersex.
Crimes of Terrorism and Other Offenses under the Human Security Act – Offenses related to acts that threaten the public’s security and safety.
Tax Evasion – Failure to pay correct taxes as determined by law.
Violations of Intellectual Property Rights – Infringement, counterfeiting, and piracy of intellectual property.
Financing of Proliferation of Weapons of Mass Destruction (WMD) – Direct or indirect financing of activities involving WMDs.
Other Crimes Punishable by More than Four (4) Years Imprisonment – The law provides for the inclusion of other crimes with penalties of over four years of imprisonment, enabling flexibility in AMLA’s scope.

Legal Implications of Predicate Crimes

When a person is charged with a money-laundering offense, the government must prove that the proceeds involved were derived from one of the predicate crimes or unlawful activities. The inclusion of these predicate crimes allows law enforcement agencies to track and investigate funds derived from illicit sources, even if the money is moved through complex financial systems. This means that a successful conviction for money laundering requires establishing a link between the accused's actions and one of the specific offenses identified as unlawful under AMLA.

Burden of Proof and Due Process

The prosecution carries the burden of proving that the funds in question are derived from predicate crimes. The AMLA permits the government to apply for freeze orders, civil forfeiture, and bank inquiries without informing the account holder, but these measures require judicial approval. However, the accused also has the right to due process and can contest claims against them.

Recent Amendments to Predicate Crimes

The amendments to AMLA have introduced additional predicate crimes and broadened the scope to align with international anti-money laundering standards. For instance:

R.A. No. 10927 introduced requirements for casinos, identifying them as covered institutions, ensuring their compliance with AMLA in monitoring high-risk financial activities.
R.A. No. 11521 further refined the definitions and scope of predicate crimes, specifically addressing gaps in cybersecurity, terrorism financing, and international financial obligations.

Regulatory Mechanisms

The AMLC is the principal body responsible for enforcing AMLA. Its powers include issuing freeze orders, inquiry orders, and conducting investigations. Covered institutions such as banks, casinos, insurance companies, and other financial institutions are obligated to report suspicious transactions (STRs) and threshold transactions (cash transactions exceeding ₱500,000 within one business day) to the AMLC.

Sanctions for Money Laundering Related to Predicate Crimes

Under AMLA, penalties for money laundering offenses vary depending on the offense severity:

Imprisonment from seven to fourteen years, depending on the role of the accused in the laundering scheme.
Fines that could amount to the value of the laundered property or the transaction itself.
Civil Forfeiture allows the government to seize and forfeit assets related to money laundering upon conviction.
Administrative Sanctions for financial institutions that fail to comply with reporting requirements, ranging from fines to suspension or revocation of licenses.

International Cooperation and Compliance with Global Standards

The Philippines, as a member of the Financial Action Task Force (FATF), has made these amendments to address global anti-money laundering and counter-terrorism financing standards. Compliance with FATF recommendations includes the continued expansion of predicate crimes and the enhancement of reporting and enforcement mechanisms to prevent the misuse of the financial system.

Conclusion

The designation of predicate crimes under the AMLA establishes a comprehensive framework to combat money laundering by targeting the proceeds of specified unlawful activities. This mechanism enables the AMLC and other government agencies to investigate and prosecute individuals engaged in laundering funds from criminal activities. The Philippine AMLA, with its numerous amendments, remains a crucial legal tool in aligning the country’s financial systems with international anti-money laundering norms and in protecting the integrity of the financial sector against abuse by criminal elements.