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Testing the banking system

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As the synchronized barangay and Sangguniang Kabataan elections approach, Bangko Sentral ng Pilipinas Deputy Governor Chuchi Fonacier has called on BSP-supervised financial institutions (BSFIs) to adopt enhances surveillance and monitoring measures to prevent a misuse of the financial system, making it a conduit of the digital vote buying or selling schemes for the polls slated on October 30.

Fonacier said the reminder is in line with efforts of the national government and the Commission on Elections to curb vote buying and selling.

“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,” she added.

She said banks should reinforce their measures and controls to ensure that appropriate customer onboarding processes, effective fraud management system, and ongoing account and transaction monitoring capabilities are commensurate to respond to fraudulent activities and mitigate the heightened risk of possible use or misuse of digital channels such as online banking and mobile wallet applications in the illegal schemes.

BSFIs are required to submit suspicious transactions to the Anti-Money Laundering Council after due investigation of complex, unusually large transactions; unusual patterns of transactions with no underlying legal or trade obligation, purpose, or economic justification; if the amount involved is not commensurate with the business or financial profile of the client; and other transactions that may be considered suspicious.

The BSP also issued Memorandum 2023-029 to remind the BSFIs on appropriate customer due diligence on politically exposed persons, which refer to individuals who are or have been entrusted with prominent public position in the country, with substantial authority over policy, operations, or the use or allocation of government-owned resources, a foreign state, or an international organization.

Considering how vote buying and selling is so deeply ingrained in Philippine politics and culture, it is difficult to comprehend how the BSP has been unable to at least limit its proliferation and sustainability. Now that the country is going digital, perhaps it can finally do something and maybe catch a big fish in the act, because if it will allow itself to be outsmarted by unscrupulous politicos and their savvy operators once more during the upcoming BSKE, it is difficult to imagine how it can do its job better when the elections for local and national posts are involved.*

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