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AUDIT TO DETECT FRAUD AND CORRUPTION: EVALUATION OF THE FIGHT AGAINST CORRUPTION AND MONEY LAUNDERING. The 10th ASOSAI Research Project. Atty. ALEXANDER B. JULIANO Director – Fraud Audit Office Commission on Audit - Philippines.
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AUDIT TO DETECT FRAUD AND CORRUPTION:EVALUATION OF THE FIGHT AGAINST CORRUPTION AND MONEY LAUNDERING • The 10th ASOSAI Research Project • Atty. ALEXANDER B. JULIANO Director – Fraud Audit Office Commission on Audit - Philippines
Assessment of Current Situation of Anti-Corruption in the Philippines
The Philippines Anti-corruption Strategy Stand-alone anti-corruption program or anti-corruptionstrategy
The Philippines Anti-corruption Strategy Umbrella document with separate programs for sectors or ministries Inter-agency Anti-Graft Coordinating Council
The Philippines Anti-corruption Strategy • Section in another policy document, e.g. national development or investment program • Strategies are embodied in Anti-corruption Laws • Specific laws, courts, and prosecutors dedicated to government anti-corruption
CHAPTERS IN THE ANTI-CORRUPTION DOCUMENT • Background chapters • Level of implementation of previous strategy • Objectives and priority areas • Chapters on prevention and criminalisation / law-enforcement measures • Public participation/education • Monitoring and assessment mechanism and criteria
ACTION PLAN The anti-corruption strategy has an action plan embodied in the Anti-Corruption Laws
ELEMENTS OF THE ANTI-CORRUPTION ACTION PLAN • General objectives • Specific measures • Specific institutions • Time-frame • Criteria for assessing implementation • Budget specially allocated • Institution responsible
PUBLICATION The anti-corruption documents and action plans are published
MEASURES EMPLOYED IN FIGHTING CORRUPTION • Open and transparency in the operation of agencies • Development and implementation of entitlements, norms and standards • Administrative reform • Development and enforcement of the code of conduct and the code of professional ethics • Penalty forms to heads of the agencies in case of occurrence of corruption • Salary payment via bank account • Declaration of assets and income • Regulation of returning gift by the public officials • Whistle blowing and prohibition of acceptance of gift/donation
ANTI-CORRUPTION AGENCIES • The Office of the Ombudsman • Department of Justice • The National Bureau of Investigation • The Commission on Audit
MAIN RESPONSIBILITIES/FUNCTIONS OF THE ACA • Monitor and evaluate the implementation of the anti-corruption strategy • Collect, centralize and exploit the denunciations • Conduct investigations • Disseminate knowledge on anti-corruption activities • Raise public awareness about the fight against corruption • Identify the causes of corruption and to propose to the competent authorities of measures to help eliminate it • Draw a risk map of corruption in the country • Anti-corruption screening of legal acts • Research and analysis on corruption • Keep a database on the statistics regarding cases of corruption year by years • Research and analysis on conflict of interest in the public management
RE-EVALUATION OF BODIES/ AREAS/ ACTIVITIES HAVING HIGH RISK OF CORRUPTION The ACAs regularly re-evaluate the bodies, areas and activities with high risk of corruption in order to employ appropriate measures to mitigate corruption
The ACAshavea hotline and website in order to facilitate citizens’ complaint on corruption.
CRIMINALIZATION OF DIFFERENT TYPES OF CORRUPTION • Special Law • Criminal Law
NEED TO ENACT NEW LEGISLATION • Abuse of position/power • Influence peddling • Kickback • Nepotism • Political dynasty
RANKING OF CORRUPTION MEASURES 1Preventive policies and measure 2 Detective actions 3 Punitive measure
LAWS AND REGULATIONS GOVERNING THE FINANCING OF POLITICAL PARTIES The Omnibus Election Code
The Philippines have laws and regulations governing code of ethics of and declaration of assets by public officials
The Philippines has “accounting and auditing standards” for both public and private sectors
Our public officials have legal obligation to report corruption-related offence
IMPLEMENTATION RATE OF THE RULES/REGULATION IN COMBATING CORRUPTIONS
THE PHILIPPINES HAS RATIFIED UNITED NATIONS CONVENTION AGAINST CORRUPTION (UNCAC) Memorandum of Implementation signed on June 14, 2013
The Philippines is a member of anti-corruption conventions, initiatives or international project (OECD Convention on Combating Bribery of Foreign Public Officials in International Business Transactions; GRECO etc.)
SOCIETY’S PARTICIPATION IN • TACKLING CORRUPTION
PRESENT LEVEL OF ANTI-CORRUPTION EFFORTS COMPARED TO PAST YEARS EXPERIENCE
PARTICIPANTS TO ANTI-CORRUPTION EDUCATIONAL AND TRAINING PROGRAMS • Public officials • Non-governmental organizations • Businessmen • Media
FACTORS THAT INHIBIT THE RESULT OF THE FIGHT AGAINST CORRUPTION
Assessment of Current Situation of Anti- Money Laundering in the Philippines
R.A. 9160 could not cover all money laundering aspects to deal with this phenomenon
RATE OF IMPLEMENTATION OF ANTI-MONEY LAUNDERING LAW
The Philippines has a national Financial Intelligent Unit (FIU) functioning as national center for the collection, analysis, and dissemination of information regarding potential money laundering offences
The Anti-Money Laundering Council (AMLC) is the • official authority in-charge of anti-money laundering
ANTI-MONEY LAUNDERING MEASURES WHICH HAVE BEEN APPLIED EFFECTIVELY
OUR AMLC PERFORMS • THE FOLLOWING FUNCTIONS
RANK OF THE EFFECTIVENESS • OF ANTI-MONEY LAUNDERING MEASURES
The citizens may inform (denounce) the country’s AML Board about a suspected case of money laundering via website of the AML Board or via letter
The AMLC requires all financial institutions to have anti-money laundering (AML) & Know Your Customer (KYC) procedures
FINANCIAL INSTITUTIONS HAVE TO COMPLY WITH LEGAL OBLIGATIONS CONCERNING ANTI-MONEY LAUNDERING LAW
FINANCIAL INSTITUTIONS ARE OBLIGED TO COMPLY WITH LEGAL OBLIGATIONS OR ADMINISTRATIVE POLICIES IN TERMS OF CLIENT DUE DILIGENCE PROCEDURES
MOST COMMON TYPES OF SUSPICIOUS TRANSACTION REPORTS (STR) FROM FINANCIAL INSTITUTIONS