Philippine Central Bank says Cyber Security is a Focus
A senior official told press that banks need better defenses after the wake of the recent SWIFT and Federal Reserve breaches. Alongside new security measures, the Philippine central bank is considering a new regulatory policy for businesses facilitating Bitcoin operations in an effort to combat money laundering.
The latest hacks against financial institutions has the banking industry worried about cyber threats. This is a big concern to the Philippine central bank and security is a top priority, the organization told press on June 4.
The financial institution has arranged a new cyber security surveillance division to monitor and supervise its branches’ security from exterior threats. The central bank deputy governor, Nestor Espenilla, spoke to a crowd at a lecture held by the bank. Espenilla told the audience:
We have a core IT supervision group […] and within that group we created a new division that is focused on cyber security issues to strengthen our capacity to deal with these attacks.
As well as the announcement of the new cyber security team, Espenilla said policymakers are planning on tightening virtual currency regulations. This includes Bitcoin exchanges, brokers, remittance companies, and money transmitters.
The regulating officers will maintain efforts to curb money laundering activities. Espenilla explains that Bitcoin has become very popular in the region with users doubling last year. The governor noted $2 million to $3 million USD a month is passing through the hands of these operators. He explained that regulation is on its way:
That is what we are looking to do, whether it is now time to impose hard regulations for virtual currency operators. Right now, we look at them as akin to remittance companies.
The Philippines is a country where digital currency has gained a foothold. In 2014, a lawmaker from Manila pushed for a digital currency with Bitcoin characteristics called the “E-Peso” to act as an online legal tender.
Kimi Cojuangco, a Pangasinan representative, created House Bill 4914, called the “E-Peso Act of 2014.” The bill asked the Philippine central bank to research and develop “bitcoin and post Bitcoin cryptocurrencies” to expand its knowledge for the E-Peso.
The policy never saw the light of day, but it seems the central bank did research the cryptocurrency for regulatory purposes.
This year, Philrem Service Corporation, a remittance company based out of Manila, had its license revoked by the Philippine central bank for being involved with the Bangladesh central bank breach.
Officials say the company’s service was used in the heist where hackers transferred $81 million using the platform. The company, founded in 1998, received a complaint from the Anti-Money Laundering Council that the facilitators helped move the money around between bank accounts, casinos, and Manila junket operators.
Philrem Service Corporation denied being involved with the looting but had its license to operate money transmission revoked.
It is not confirmed when the new regulatory policies concerning Bitcoin operators will com into effect. However, from the sounds of the governor’s statements, the regulations will be strict, which could hamper Bitcoin businesses and related remittance startups in the country similar to the impact of the BitLicense in New York state.
What do you think about the Philippine central bank regulating Bitcoin? Let us know in the comments below!
Images via Wiki Commons, Coin.dance, Pixabay