Amid reports of possible money laundering, the Bank of the Philippines Islands (BPI) said only a fourth of the total global transaction of its Australian-based remittance partner, Westpac Banking Corp., was coursed through them.
Owen Cammayo, BPI head of Corporate Affairs and Communications, said that of the 23 million Westpac transactions globally cited by Financial intelligence unit Australian Transaction Reports and Analysis Center (AUSTRAC) , only 0.27 percent was coursed through BPI.
From July 2016 to October 2019, a total of only 61,687 transactions were coursed through BPI and credited to various recipient banks in the Philippines, Cammayo said.
“Of this number, 34 percent was credited to BPI accounts, the second largest in terms of transaction count,” Cammayo said.
BPI and Westpac entered into a remittance tie-up arrangement for the use of Westpac’s LitePay platform back in 2016, Cammayo said.
He added that Westpac’s clients used the platform to send remittances to the Philippines for BPI to fulfill, whether for credit to the accounts of BPI clients or for those of other Philippine banks.
“At the time of initiation of the partnership, Westpac made representations and warranties that they are in compliance with all applicable regulations,” Cammayo said.
BPI suspended its use of Westpac LitePay on Nov. 24, 2019, immediately upon learning of the Australian authorities’ investigations against Westpac.
AUSTRAC has launched legal action last month accusing Westpac of enabling 23 million payments in breach of anti-money laundering laws possibly related to child exploitation.
Cammayo said the there is no formal investigation by the Bangko Sentral ng Pilipinas (BSP) on BPI with respect to Westpac.
“The BSP has requested for certain information regarding Westpac LitePay transactions and we have submitted it to them. The alleged failures of Westpac’s LitePay facility are a very serious concern to us. We have always worked closely with the regulators and authorities to ensure continued compliance with both domestic and global money laundering laws and regulations,” Cammayo said.
On Tuesday, Chuchi Fonacier, BSP Deputy Governor said initial investigations conducted by BPI revealed it was used as a conduit for money transfer of Westpac.
“(The funds were channeled to) about 10 banks. So we’ll also be reviewing the transactions,” she added.
But Fonacier said the transactions then were not considered suspicious as it goes below the P500,000 threshold of the Anti Money Laundering Council (AMLC).
“It’s very retail. That’s why (the process of reviewing is) very tedious. But so far we’ve identified the other banks that became the recipient of the remittances from Australia,” Fonacier said.
Fonacier, however, reiterated that banks should still practice due diligence before clearing money transfers.
Fonacier did not disclose the name of the banks involved.