MANILA, 8 March 2003 — President Gloria Macapagal Arroyo yesterday signed into law a revised anti-money laundering act and non-government organizations (NGOs) said overseas Filipinos should worry no more.

The law would bring the Philippine banking system in line with standards demanded by the Paris-based Financial Action Task Force (FATF), which wants to choke off the movement of funds by terrorists and criminals.

A watered-down version passed by Congress last month was rejected by the FATF, prompting warnings from economic officials that the Philippines faced imminent financial sanctions from developed nations.

This prompted protests from NGOs, who warned that the sanctions could affect Overseas Filipino Workers (OFWs), whose remittances to their families at home are a major source of foreign exchange.

Congress went down to work on the revised version immediately after FATF experts explained to legislative leaders on Monday that freezing suspect accounts must not be subject to prior court approval, because the funds could be transferred elsewhere by the time the court order is obtained.

Some legislators had earlier charged that the banking reform law being sought by the FATF would threaten the secrecy of bank accounts and could be manipulated for political purposes.

In signing the new law, President Arroyo said: “We shouldn’t consider the passage of (the amendments) as a passive and grudging compliance to the rules of the global financial system.”

“This is about Filipinos doing what is in their best interest and not what is merely in the interest of foreigners,” she said, responding to criticism that the new rules amounted to the Philippines bowing to foreign demands.

Acknowledging the divisive effect of the debate on the amendments, Arroyo described the reforms as a delicate balance between “our legal, psychological and political biases on one hand and the need to adopt and comply with the rules of the international world.”

The new law authorizes the central bank to “inquire into or examine any deposit or investment” or transaction in excess of half a million pesos ($9,132) without a court order, to ensure that financial institutions comply with the law.

It also authorizes the Anti-Money Laundering Council, the law’s criminal enforcement agency, to investigate suspect accounts regardless of the amount involved, as well as to freeze the funds.

However, all the council’s actions would require prior court approval except for accounts suspected to be related to kidnapping, drug-trafficking, hijacking and terrorism.

Jovis Vistan of AB Capital Securities Inc. said the immediate impact was that the country would be spared from sanctions.

But in the long run, the law’s passage “should slowly improve the country’s image which is hampered with the tag of being a haven for terrorists and money launderers.”

Noel Josue, executive director of Kaibigan ng OFW with 30,000 members all over the world, said the senators were apparently “pressured” into approving the amendments by the rallies in support of these.

Rachelle Garcia, managing director of OFWNet, said: “I’m actually relieved because the bottom line is what would be what is good for our constituents, the OFWs.”

“We understand the points of our legislators but in the end it’s really the OFW who will suffer. Whatever meager earnings they earn abroad will be delayed and they will have to pay extra to remit these. The ones who will be hardest hit will still be the OFWs,” Garcia said.

Francisco Aguilar Jr., president and general manager of FMW Human Resources International and a former OFW, said with or without the new law, PFWs could send their money home. “The question is the delay…” he said.

Perla Vega, founding chair of the Movement to Help Eradicate Rape and Other Abuses (Mother), said their efforts at rallying “paid off” with the ratification of the amendments.

Abulkair Guro, a former OFW community leader in Jeddah, said what the amendments show is that OFWs could really contribute to making of policies at home if they speak with one voice at least on key issues affecting their concerns.