That Bank Secrecy Law -- And How Secret Really Is Secret?

By JERRY LIAO February 27, 2012, 2:00am MAINLA, Philippines Let me start by citing Section 2 and 3 of Republic Act #1405 also known as the Bank Secrecy Law of the Philippines: SECTION 2. All deposits of whatever nature with banks or banking institutions in the Philippines including investments in bonds issued by the Government of the Philippines, its political subdivisions and its instrumentalities, are hereby considered as of an absolutely confidential nature and may not be examined, inquired or looked into by any person, government official, bureau or office, except upon written permission of the depositor, or in cases of impeachment, or upon order of a competent court in cases of bribery or dereliction of duty of public officials, or in cases where the money deposited or invested is the subject matter of the litigation. SECTION 3. It shall be unlawful for any official or employee of a banking institution to disclose to any person other than those mentioned in Section two hereof any information concerning said deposits. The ongoing impeachment trial of Chief Justice Renato Corona raised some concerns with regards to the Bank Secrecy Law since the accounts of the Chief Justice was brought to the attention of the public. According to PSBank Katipunan Branch manager Annabelle Tiongson and PSBank president Pascual Garcia, the said documents / forms attached by the prosecution to their complain were falsified or faked. Now I am not a lawyer nor a bank person, but I know my technology. It is not important to me if the documents / forms were faked or falsified - my concern is how did hose accounts reached or was written into those forms? Where did those information (accounts) came from? Who filled it in? Fake or not, the account numbers exist - both the peso accounts and the dollar accounts of the Chief Justice. Can these accounts be seen only by officials or employees who are working in the Katipunan branch or main branch of PSBank? To the best of my knowledge, the accounts can be seen by all branches of the same bank and can be accessed by all officials and employees who are given authority to access the bank system. Why? Because most if not all bank computers are interconnected. You don't have to be an expert to know this. The mere fact the one can withdraw his/her money from any branch of the same bank proves my point. If I am a depositor of one bank in Pasig, I can go to a branch in Makati (of the same bank) and do transactions there. Which means, the officials and employees of the bank in the Makati branch can and have access to my accounts. But security features are put in place so as to prevent unnecessary leakage. If my main bank is in Pasig, all other branches of the same bank (except the main branch) can view my bank account number, only my bank account number - not my balance or my transactions. And in this impeachment trial, the account numbers are sufficient. Now if you are an oridinary person who would go to a bank and ask if a particular account exist or if you simply what to know the accounts of a particular depositor, I don't think you will have any success in getting those information because of the law I stated above. But what if you have a friend or a relative who works for a particular bank?

REPUBLIC ACT NO.1405 AN ACT PROHIBITING DISCLOSURE OF OR INQUIRY INTO, DEPOSITS WITH ANY BANKING INSTITUTION AND PROVIDING PENALTY THEREFOR SECTION 1. It is hereby declared to be the policy of the Government to give encouragement to the people to deposit their money in banking institutions and to discourage private hoarding so that the same may be properly utilized by banks in

authorized loans to assist in the economic development of the country. SECTION 2. All deposits of whatever nature with banks or banking institutions in the Philippines including investments in bonds issued by the Government of the Philippines, its political subdivisions and its instrumentalities, are hereby considered as of an absolutely confidential nature and may not be examined, inquired or looked into by any person, government official, bureau or office, except upon written permission of the depositor, or in cases of impeachment, or upon order of a competent court in cases of bribery or dereliction of duty of public officials, or in cases where the money deposited or invested is the subject matter of the litigation. SECTION 3. It shall be unlawful for any official or employee of a banking institution to disclose to any person other than those mentioned in Section two hereof any information concerning said deposits. SECTION 4. All Acts or parts of Acts, Special Charters, Executive Orders, Rules and Regulations which are inconsistent with the provisions of this Act are hereby repealed. SECTION 5. Any violation of this law will subject offender upon conviction, to an imprisonment of not more than five years or a fine of not more than twenty thousand pesos or both, in the discretion of the court. SECTION 6. This Act shall take effect upon its approval. Approved, September 9, 1955.