Overview: Regulatory Shift in the Philippines
The Bangko Sentral ng Pilipinas (BSP) issued Circular No. 1213 in May 2025 as part of the implementing rules for the Anti-Financial Account Scamming Act (AFASA) or Republic Act No. 12010. Building on its earlier real-time fraud detection mandate (Circulars 1140 and 1160), BSP has now introduced stringent IT risk management requirements designed to combat the escalating threat of financial cybercrime in the Philippines.
Core Regulatory Requirements
BSP-supervised Financial Institutions (BSFIs) engaged in complex electronic products and services with high aggregate values (averaging ₱75 million monthly for the last six months) must implement comprehensive Fraud Management Systems.
To strengthen fraud detection and prevention, BSFIs mustl leverage a combination of rule-based approaches, machine learning algorithms, and other technologies to adapt to evolving fraud tactics. These systems must include five essential fraud detection mechanisms:
Behavioral Anomalies detection identifies deviations from typical user behavior, including spending patterns and login habits. This includes detecting collective transactional behavior anomalies such as multiple fund transfers to few recipients or patterns indicating concentration without business purpose.
Account Protection Safeguards
Financial accounts must implement comprehensive security measures including:
Enhanced Authentication Requirements mandates significant strengthening of authentication mechanisms, particularly limiting the use of interceptable authentication methods like SMS and email OTPs.
Customer Empowerment Features
Digital platforms facilitating retail interbank fund transfers must offer specific customer protection features:
Customizable Transaction Limits enable account holders to set restrictions on transaction numbers, values, or types within BSFI-predefined limits.
How Clari5 Enables Regulatory Compliance
Clari5 is a real-time, enterprise-grade AI-powered financial crime risk management platform. It combines deterministic scenarios with machine learning, behavioral intelligence, and Digital TrustArmour to provide a unified response to fraud, mule activity, and scam detection fully aligned with BSP Circulars 1213 (AFASA implementation) and 1215 (dispute tracing requirements).
AI + Scenario Based Fraud Risk & Anti-Money Laundering Solution (FRAML)
BSP Requirement
Real-time detection/blocking of suspicious transactions.
Clari5 Solution:
Digital TrustArmour – Behavioral Biometrics & Device Risk Analytics
BSP Requirement: Prohibit bots/scripts, identify risky devices, and flag abnormal behavior.
Clari5 Response:
Mule Fraud and Ring Detection
BSP Requirement: Trace disputed funds across institutions.
Clari5 Response:
Adaptive Risk Response & Customer-Level Profiling
BSP Requirements: Dynamic authentication, behavioral monitoring, customer empowerment.
Clari5 Response:
Conclusion
Clari5 helps banks meet and exceed the requirements of BSP Circulars 1213 by offering:
Clari5 not only ensures compliance — it enables a future-ready fraud defense strategy that is real-time, explainable, and scalable.
Read how BSP’s earlier mandate on real-time fraud monitoring set the stage for these expanded requirements here.
