Corruption will continue if bank secrecy law is not repealed
It was the yearning for strong leadership that catapulted Rodrigo Duterte to power in 2016. As we now know it, that cannot be enough. Strong leadership is more about strength of purpose or the clarity of vision than just about getting tough. This maxim goes well with this paper’s article (“‘Robredo’s economic policies clear, Marcos’ unclear,’” 4/28/22) on a report by FocusEconomics, a Barcelona-based think tank, which cited that while “investor perceptions of Marcos appear weak, raising market jitters” and that “most economists [prefer] a Robredo presidency” because her policy platform “contains far greater detail,” there remains “uncertainty … regarding the candidates’ exact policies, which is likely restraining investment.”
No doubt, from a young age, our parents and teachers taught us to pay close attention to details. This is essentially the lesson of the idiom, “the devil is in the details.” Details are important because something may seem simple, but in fact the details can be complicated and could cause problems. There is a need to be conscientious and to pay attention to the small things—what clear and specific policy objectives are all about as opposed to motherhood statements.
Every candidate promises to crack down on corruption. But would anyone dare commit to revisit our antiquated bank secrecy law (Republic Act No. 1405)? RA 1405 was enacted more than half a century or 67 years ago to encourage Filipinos to deposit their money in banks instead of hoarding them by guaranteeing the privacy of banking transactions, where no one, unless via a court order or waiver, can access records of those transactions. So outdated is this law that the Philippines remains one of only three countries in the world (with Lebanon and North Korea) that have ultrastrict bank secrecy laws. Here lies the difficulty we have seen in going after elected and appointed officials in the government, rent-seekers in business, and elements of criminal syndicates suspected or accused of graft without any money trail. Here, too, lies the perpetration of their greed paid for by the poor.
On the expenditure side, it has been said that 40 percent of people’s money is lost to corruption yearly. That is 40 centavos going into someone else’s pocket for every peso intended for public services. Income foregone on the revenue side is tougher to estimate. These losses, combined and when recouped, hold the key to any prospective leader’s real capacity to fulfill his/her commitment to better education, which only means more teachers, public schools, learning materials, scholarship grants, etc.; better health care that only means more doctors, medical staff, hospitals, clinics, medicines, health insurance, etc.; better housing; and better infrastructure, all translating to a country’s better competitiveness, regionally and globally. Monies well spent with the least spillage hold the key to raising business confidence on which jobs creation and more tax revenues depend, and to boosting trust and credit rating in the global financial market in which access to loans and better service payments are a function of.
When asked during a hearing of the Senate committee on banks in 2016 if the Bangko Sentral ng Pilipinas (BSP) would support a repeal of the bank secrecy law, then BSP chief Amando Tetangco Jr. replied: “Our main concern, Mr. Chairman, with respect to the bank secrecy law, is in terms of being able to ensure that existing regulations are being complied with. That’s number one. And number two, to provide some form of deterrent for possible fraud, unlawful activity, or irregularity…”
There are stories affixed to banking transactions. They are not just empty figures. So, unless our next president and Congress realize and act on the need to repeal this age-old law, no end to corruption will ever be in sight.
This is the golden time to challenge candidates and to get their commitment, not after elections. Else, we can all end up fighting the same endless corruption.
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