Investors Warned: Cautious Approach Needed When Dealing with Properties or Funds Linked to Terrorism

In light of recent developments, financial authorities have issued guidelines emphasizing the importance of exercising caution when dealing with properties or funds that may be linked to terrorism financing or other violations under the TF Suppression Act.

Guidelines and Exceptions

The guidelines highlight three exceptions to the prohibition against dealing with property or funds under Section 8 of the TF Suppression Act. These exceptions include:

• Humanitarian Exemptions: As provided for under Section 13 of the TF Suppression Act
• Judicial Payments: Necessary to satisfy a judicial, administrative or arbitral judgment rendered or lien encumbered prior to the date of designation or listing of the designated persons, organizations, associations or groups of persons
• AML Compliance: Payments made in accordance with the rules and regulations of the AMLC

Verification and Due Diligence

The guidelines also emphasize the importance of verifying the identity and background of individuals or entities involved in transactions related to properties or funds. This includes:

• Verifying the identity and background of individuals or entities involved in transactions
• Ensuring compliance with relevant rules and regulations, including freeze orders

Warnings and Consequences

Investors are warned against dealing with properties or funds that may be controlled or used by designated persons, even if they do not own a majority stake. This includes situations where a designated person has control through minority interests, voting rights, or other means.

• Failure to comply with freeze orders may result in criminal prosecution
• Imprisonment ranging from six months to four years
• Fines of up to Five Hundred Thousand Pesos (Php500,000.00)

Key Takeaways

• Investors must exercise a cautious approach when dealing with properties or funds linked to terrorism financing or other violations under the TF Suppression Act
• Verify the identity and background of individuals or entities involved in transactions
• Ensure compliance with relevant rules and regulations, including freeze orders
• Failure to comply with freeze orders may result in criminal prosecution, imprisonment, and fines

Action Required

• Review and update your due diligence processes to ensure compliance with TF Suppression Act guidelines
• Verify the identity and background of individuals or entities involved in transactions
• Report any suspicious activity or attempts to circumvent financial sanctions to relevant authorities