Authority and covered entities
- The Bangko Sentral ng Pilipinas (BSP) issues the memorandum to ensure compliance by pawnshops with existing regulatory duties.
- The memorandum applies to ALL PAWNSHOPS, including their OWNER(s), PARTNERS, BOARD OF DIRECTORS, MANAGEMENT and EMPLOYEES concerned.
- Compliance is required in any and all pawnshop transactions involving pawners and pawned articles.
- The memorandum treats responsible persons as directly within BSP supervisory coverage for willful and/or deliberate violations.
Core compliance duties for pawnshops
- Subsection 4301P.1 of MORNBFI-P requires pawnshops to ascertain whether the pawner is the true owner of the article/s offered as pawn.
- Subsection 4301P.1 further requires pawnshops to ensure that there is no ground to suspect that the article/s offered as pawn were an object of robbery or theft.
- Subsection 4301P.3 of MORNBFI-P requires the presentation of a valid photo-bearing ID as part of the Know Your Pawner requirements.
- Pawnshop ID presentation duties under Subsection 4301P.3 apply in addition to the customer identification requirements under Rule 9.1.c of the Revised Implementing Rules and Regulations (RIRRS) of Republic Act No. 9160, as amended.
Anti-money laundering linkage
- Pawnshop identification compliance must align with the Anti-Money Laundering Act framework under Republic Act No. 9160, as implemented by Rule 9.1.c of the RIRRS.
- Pawnshops must observe KYP identification requirements through valid photo-bearing ID presentation while also meeting AML customer identification requirements under Rule 9.1.c.
- The memorandum reinforces that KYP and AML identification requirements operate together in pawnshop transactions.
Substantive enforcement and sanctions
- Any pawnshop, including its OWNER(s), PARTNERS, BOARD OF DIRECTORS, MANAGEMENT and EMPLOYEES concerned, that is found to have wilfully and/or deliberately violated the cited rules and regulations is subject to sanctions and penalties.
- Sanctions and penalties for such violations are governed by Sections 17 and 18 of Presidential Decree No. 114 (Pawnshop Regulation Act).
- Additional penalties are governed by Sections 4199P and 4399P of MORNBFI-P.
- The memorandum also ties penalties to Section 14 of Republic Act No. 9160 (Anti-Money Laundering Act of 2001) and Section 36 of Republic Act No. 7653 (New Central Bank Act).
Enumerated regulatory provisions to follow
- Pawnshops must comply with Subsection 4301P.1 of MORNBFI-P on verifying the pawner’s true ownership and ensuring no grounds to suspect robbery or theft.
- Pawnshops must comply with Subsection 4301P.3 of MORNBFI-P on requiring presentation of a valid photo-bearing ID.
- Pawnshops must comply with customer identification requirements under Rule 9.1.c of the RIRRS of Republic Act No. 9160, as amended, alongside the KYP ID requirement under Subsection 4301P.3.