Philippines asks its revenue and customs arms to enhance cyber security

Philippines asks its revenue and customs arms to enhance cyber security

Call comes from finance secretary following rise in attacks.

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Philippine’s finance secretary Carlos Dominguez III has directed the country’s Bureau of Internal Revenue (BIR) and the Bureau of Customs (BOC), two of its main revenue-generating agencies, to beef up their cyber security defences.

Dominguez’s call comes against the backdrop of major hacking incidents involving BDO Unibank and Union Bank of the Philippines (UnionBank) and complaints of several teachers about losing money from their accounts in the Land Bank of the Philippines (LandBank).

More Filipinos prefer online transactions to avoid face-to-face interactions amid the Covid-19 pandemic.

In January, prosecutors filed criminal charges against four suspects, arrested by the National Bureau of Investigation (NBI), over the hacking of hundreds of Unibank accounts in December last year.

Union Bank of the Philippines said in December that it had frozen several bank accounts allegedly used to receive funds from the hacked Unibank accounts.

LandBank has already issued a statement saying that its systems remain secure against any form of hacking and that its initial investigation showed the teachers were the victims of a phishing scam.

Finance undersecretary Antonette Tionko, who oversees both the BOC and BIR as head of the DOF’s Revenue Operations Group (ROG), has assured Dominguez that cyber security is an important part of the ongoing digitalisation and modernisation programs of the two agencies.

Champion of digitalisation

Dominguez has championed digitalisation for a long time. 

In March 2020, even before the enormity of the Covid-19 pandemic was apparent, he directed the Philippines department of finance (DOF) and its attached agencies to vigorously pursue their digitalisation programs to help boost revenue collections and further improve the delivery of services to the public.

Dominguez ordered government financial institutions (GFIs) and other agencies under the DOF to work together in coming up with a cost-effective defence strategy that would shield their respective systems from potential cyber security threats along with other possible risks and data breaches in the digital landscape.

He instructed GFIs, state-run pension funds and insurance agencies, and the revenue and treasury agencies to enter into respective memoranda of agreements (MOAs) on a shared cyber defence strategy.

Preliminary data shows that for 2021, BIR was able to collect P2.07 trillion (S$54.25 billion), which is only short by 0.31 percent of its target set by the Development Budget Coordination Committee (DBCC) for the year.

The BOC, on its part, overshot its target, collecting P645.77 billion, which was 4.7 percent over its DBCC-set goal of P616.75 billion for 2021.

The BOC is proceeding in full swing with its World Bank-funded customs modernisation program, even as it implements the digitalisation projects already in the pipeline, such as Electronic Advance Ruling System (e-ARS) for Valuation and Rules of Origin; and the use of the Association of South-east Asian Nations (Asean) Single Window (ASW) platform in exchanging customs declaration documents with other participating Asean economies.

Among those who have gained the most from digitalisation are pensioners, employers and members of the social security system (SSS), which shifted online the filing of claims.

Government financial institutions such as the LandBank and DBP have accelerated the application of financial technology (fintech) solutions to better assist small farmers and fishermen, while also expanding their retail banking services.

Digital transformation initiatives include automating processes in extending financial assistance, and improving information systems to provide more accurate and reliable data to better implement their respective programs.

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