BSP uses new AFASA Law to investigate accounts linked to flood-control corruption controversy

​The Bangko Sentral ng Pilipinas (BSP) is using a brand-new law to investigate individuals implicated in the country’s flood-control corruption controversy.

​The BSP has launched an inquiry into bank accounts of the individuals under the Anti Financial Account Scamming Act (RA 12010) or AFASA and its implementing rules, which took effect in June this year. The investigation focuses on Money Muling Activities, which the law criminalizes. Specifically, using a financial account to obtain, receive, deposit, transfer or withdraw proceeds that are known to be derived from crimes is considered money muling under Section 4(a) of AFASA.

The inquiry includes a reminder for concerned regulated entities to comply with the  provisions on temporary holding of funds under Section 7 of the AFASA, as implemented by BSP Circular No. 1215, series of 2025.

The BSP's move follows an official request filed on Monday by DPWH Secretary Vince Dizon.

"The BSP is using AFASA for the first time to join and assist other agencies in investigating and prosecuting the persons alleged to be involved in these crimes,” BSP General Counsel Roberto Figueroa said. “We are also keen to leverage this authority to uphold the integrity of our financial system against criminal actors.”

The BSP provided key support for the passage of AFASA, which gives it the authority to investigate and inquire into bank accounts involved in activities prohibited under the said law. Under the AFASA, the provisions of laws on secrecy of deposits and data privacy shall not apply to financial accounts subject of the BSP’s investigation.

Material information that the BSP will secure from the bank accounts can be used for prosecution or investigation of AFASA-related offenses. Penalties for Money Muling Activities under Sec. 4(a) include imprisonment of six to eight years and/or a fine of P100,000 to P500,000. A conviction also carries civil liabilities, which may include restitution for damage done or unwarranted benefit. All properties and/or any other non-liquid assets used for the commission of the prohibited acts shall also be subject to civil forfeiture, in accordance with Supreme Court rules.

The BSP's move is on top of the freeze order of bank accounts issued by the Court of Appeals (CA) also on Tuesday in response to a petition filed by the Anti-Money Laundering Council (AMLC).

Money laundering refers to activities to make “dirty money" look like it came from legitimate sources using transactions involving property, expensive cars and art, gambling, among others before reintroducing them into the economy as legitimate funds.