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(101) Employment of any device, scheme or artifice to defraud in connection with the purchase and sale of any securities; (102) Obtaining money or property in connection with the purchase and sale of any security by means of any untrue statement of a material fact or any omission to state a material fact necessary in order to make the statements made, in the light of the circumstances under which they were made, not misleading; (103) Engaging in any act, transaction, practice or course of action in the sale and purchase of any security which operates or would operate as a fraud or deceit upon any person; (104) Insider trading; (105) Engaging in the business of buying and selling securities in the Philippines as a broker or dealer, or acting as a salesman, or an associated person of any broker or dealer without any registration from the Commission; (106) Employment by a broker of any salesman or associated person or by an issuer of any salesman, not registered with the SEC; (107) Effecting any transaction in any security, or reporting such transaction, in an Exchange or using the facility of an Exchange which is not registered with the SEC; (108) Making use of the facility of a clearing agency which is not registered with the SEC; (109) Violations of margin requirements; (110) Violations on the restrictions on borrowings by members, brokers and dealers; (111) Aiding and Abetting in any violations of the Securities Regulation Code; (112) Hindering, obstructing or delaying the filing of any document required under the Securities Regulation Code or the rules and regulations of the SEC; (113) Violations of any of the provisions of the implementing rules and regulations of the SEC; (114) Any other violations of any of the provisions of the Securities Regulation Code.

(N) Felonies or offenses of a similar nature to the afore-mentioned unlawful activities that are punishable under the penal laws of other countries. In determining whether or not a felony or offense punishable under the penal laws of other countries, is “of a similar nature”, as to constitute the same as an unlawful activity under the AMLA, the nomenclature of said felony or offense need not be identical to any of the predicate crimes listed under Rule 3.i.

RULE 4 Money Laundering Offense

Rule 4.1. Money Laundering Offense. — Money laundering is a crime whereby the proceeds of unlawful activity are transacted, thereby making them appear to have originated from legitimate sources. It is committed by the following:

(a) Any person knowing that any monetary instrument or property represents, involves; or relates to, the proceeds of any unlawful activity, transacts or attempts to transact said monetary instrument or property. (b) Any person knowing that any monetary instrument or property involves the proceeds of any unlawful activity, performs or fails to perform any act as result of which he facilitates the offense of money laundering referred to in paragraph (a) above. (c) Any person knowing that any monetary instrument or property is required under this Act to be disclosed and filed with the Anti-Money Laundering Council (AMLC), fails to do so.

RULE 5 Jurisdiction over Money Laundering Cases and the Money Laundering Investigation Procedures

Rule 5.1. Jurisdiction over Money Laundering Cases. — The Regional Trial Courts shall have the jurisdiction to try all cases on money laundering. Those committed by public officers and private persons who are in conspiracy with such public officers shall be under the jurisdiction of the Sandiganbayan.

Rule 5.2. Investigation of Money Laundering Offenses. — The AMLC shall initiate the investigation of covered transactions, money laundering activities and other violations of this Act, pursuant to Section 7 (5) of the AMLA, under any of the following circumstances;

(a) On the basis of a mandatory filing of a covered transaction report, pursuant to Section 9 (c) of the AMLA, where the covered institution reports a transaction in excess of Four Million Pesos (Php4,000,000.OO) or an equivalent amount in foreign currency based on the prevailing exchange rate, and (i) The person involved in the transaction was not a properly identified client; and (ii) The amount is not commensurate with the business or financial capacity of the client; or (iii) There was no underlying legal or trade obligation, purpose, origin or economic justification.

(b) On the basis of a mandatory filing of a covered transaction report, pursuant to Section 9 (c) of the AMLA, where the covered institution reports a transaction in excess of Four Million Pesos (Php4,000,000.OO) or an equivalent amount in foreign currency based on the prevailing exchange rate, in a single, series or combination or pattern of unusually large and complex transaction, especially cash deposits and investments having no credible purpose or origin, underlying trade obligation or contract.

(c) On the basis of any report on any suspicious transaction, where the covered institution has reasonable ground to believe that any money laundering activities or any money laundering offense or any violation of this Act under Section 4 and Section 7 (5) of the AMLA and defined under Rule 4 of these Rules is about to be, is being or has been committed.

Rule 5.3. Suspicious Transactions. — As may be directed by the AMLC and/or in the exercise of their supervisory and/or regulatory powers over covered institutions under their respective jurisdictions, supervising authorities may require all suspicious transactions with covered institutions, irrespective of the amount involved, to be reported to the AMLC when there is reasonable belief that any money laundering activity or any money laundering offense or any violation of this Act under Section 4 and Section 7 (5) is about to be, is being or has been committed.

Administrative sanctions for non-compliance with such suspicious transaction reporting requirements may be imposed by supervising authorities •as authorized under their respective charters.

Rule 5.4. Attempts at Transactions. — Section 4 (a) and (b) of the AMLA provides that any person who attempts to transact any monetary instrument or property representing, involving or relating to the proceeds of any unlawful activity shall be prosecuted for a money laundering offense. Accordingly, the reports required under Rule 9.3 (a) and (b) of these Rules shall include those pertaining to any attempt by any person to transact any monetary instrument or property representing, involving or relating to the proceeds of any unlawful activity.

RULE 6 Prosecution of Money Laundering

Rule 6.1. Prosecution of Money Laundering. — Rule 6.1.a. Any person may be charged with and convicted of both the offense of money laundering and the unlawful activity as defined under Rule 3 (I) of theAMLA.

Rule 6.1.b. Any proceeding relating to the unlawful activity shall be given precedence over the prosecution of any offense or violation under the AMLA without prejudice to the issuance by the AMLC of a freeze order with respect to the deposit, investment or similar account involved therein and resort to other remedies provided under the AM LA.

Rule 6.2. When the AMLC finds, after investigation, that there is probable cause to charge any person with a money laundering offense under Section 4.

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