Congress, business expect FATF's.

The Philippines narrowly escaped crippling sanctions on its financial sector after it passed a landmark anti- money laundering law over the weekend.

BusinessWorld learned that the Paris-based Financial Action Task Force (FATF), the financial crimes monitoring arm of the Group of Seven highly industrialized nations, has already prepared an "initial set of sanctions" that would have been announced today, had Congress failed to pass the bill by September 30.

"We were informed that some sanctions would have been immediately imposed by (today) if the law's enactment was delayed even by one day," said an official of the Bangko Sentral ng Pilipinas (BSP), requesting anonymity.

The FATF order to financial institutions of its member countries had been prepared and would have been sent out at the opening of business today in Europe, he said.

"The document and the sanctions were already prepared," the official said.

"All it needed was a signature and they would have announced it if (FATF officials) did not receive a (facsimile transmission) from us first thing Monday, saying that the bill had cleared Congress," the official added.

Among the sanctions that FATF- member countries would have imposed on the Philippines was to order their financial institutions to isolate all incoming and outgoing Philippine transactions from their other businesses, to allow regulators to verify the origin and nature of these transfers.

"We were informed that all Philippine transactions would have been shifted from computerized (processing) to manual (processing)," the official said.

In addition, US regulators were also preparing to tighten documentation and examination requirements for Philippine-based firms and US companies doing business in the country.

"The US Securities and Exchange Commission would have examined us to death for any application to do business there," the official said.

Meanwhile, BSP Governor Rafael B. Buenaventura welcomed the enactment of the anti-money laundering law, saying that the country can now look forward to more equal treatment in the international financial community.

"This effectively lifts the cloud of doubt that has been over the country since we were included in the …