Вы находитесь на странице: 1из 4

Philippine Bank Secrecy Law Simplified already be a case pending in court, the account be clearly

The current banter between President Duterte and Senator identified, the inspection be limited to the subject matter
Trillianes about bank secrecy waivers has piqued the of the pending case; and the bank personnel and the
interest of the public on the matter of bank secrecy. So, depositor must be notified to be present during the
what is bank secrecy? Is it absolute? Are there any inspection;
exceptions? 6. The BIR can inquire into bank deposits in an application
On 09 September 1955, Republic Act No. 1405, otherwise for compromise of tax liability or determination of a
known as An Act Prohibiting Disclosure of or Inquiry into, decedent’s gross estate;
Deposits with any Banking Institution (“Bank Secrecy Law”), 7. The Anti-Money Laundering Council (“AMLC”) can
was approved. This law was enacted to encourage examine bank accounts pursuant to a court order, where
individuals to deposit their money in banks instead of there is probable cause that the deposits are related to an
hoarding them. unlawful activity or money laundering offense;
You may ask, why is there a need to protect the secrecy of 8. The AMLC can examine bank accounts, WITHOUT a court
bank deposits? Technically speaking, the law prefers that order, where there is probable cause that the deposits are
money be deposited in banks so they may be properly related to certain crimes such as kidnapping for ransom,
utilized to assist in the economic development of the violation of the Dangerous Drugs Act, hijacking, destructive
country. However, it is more relevant on a practical matter. arson, murder and violations of RA 6235 (acts inimical to
Let’s use you dear reader as an example. Suppose that you civil aviation);
only have P1,000 in your bank account. Surely, you do not 9. The BangkoSentral can examine bank accounts in the
want any person (such as your friend, employer or any course of its periodic or special examination regarding
stranger) to find that out. Either you do not want others to compliance with Anti-Money Laundering Law.
know that you do not have sufficient money or you simply Examination of all deposits and disclosure by bank
do not feel comfortable in people prying in your financial personnel to unauthorized people is prohibited.
affairs. On the other hand, if you have P100,000,000.00 in Government people, including the BIR people, cannot look
your bank account, you also do not want others to find that at your bank records except in any of the instances
out for fear that you might be kidnapped, or relatives might mentioned. So if the tax man picks up your bank passbook
borrow from you, or simply, it’s your personal affair. In all from your desk, you can bring him up on charges. All banks,
these cases, one’s financial status is a private matter. as well as their personnel are also prohibited from
Transactions happening in your bank account are not just disclosing their records except if any of the eight (8)
empty figures. There are stories affixed to such instances are mentioned. Violations of this law are
transactions. Thus, these financial transactions are akin to punished by a prison sentence of up to five (5) years, a fine
your personal activities which should not be easily of P20,000, or both.
accessible to anyone.
As you can see, although there are many exceptions,
The Bank Secrecy Law protects all deposits of whatever securing such exceptions is not an easy task. The easiest
nature in banks or banking institutions in the Philippines as way to waive the secrecy of bank deposits is through a
well as investments in government bond. This law prohibits written waiver. Although there is no prescribed form for a
any person, subject to the exceptions below, from waiver, it is necessary that the waiver be made voluntarily,
disclosing to any person any information, relative to the knowingly and with sufficient awareness of relevant
funds or properties belonging to the depositors in the circumstances and consequences. Thus, as a matter of
custody of the bank (Absolute Confidentiality). Simply put, practice, banks will require the depositor to state in his
no one can just go to your bank and ask for your bank waiver the specific bank account, bank branch, name of
balance. depositor, period covered by the transactions and the
However, the rule is not absolute. The following are the name of the person authorized to access the bank account.
exceptions to the bank secrecy law: How about dollar deposits? Now, foreign currency deposits
1. Written permission or consent in writing by the are governed by a different law, namely Republic Act No.
depositor; 6426 and has fewer exceptions. This will be discussed in a
2. In cases of impeachment; separate article.
3. Upon order of the court in cases of bribery or dereliction You may be curious if there is any criminal liability for
of duty of public officials; violating the bank secrecy law. Yes, there is criminal
4. Upon order of the court in cases where the money liability. Any person violating this law may be imprisoned
deposited or invested is the subject matter of the litigation; for not more than five (5) years, or meted a fine not
5. Upon a subpoena issued by the Ombudsman concerning exceeding P20,000.00 or both.
an investigation it is conducting, provided that there must
SALN and Unexplained Wealth 4. Accept the deposits in question as collateral for
Under the anti-graft law, every public officer is required to loans under the rules and regulations promulgated
submit a true detailed and sworn statement of assets and from time to time by the Central Bank
liabilities (SALN) within 30 days from assuming office. This 5. Pay interest in foreign currency on these deposits
SALN should also include a statement of the amounts and The banks in question are required to maintain a 100%
sources of his income, personal and family expenses as well cover for their deposit liabilities.
as the amount of income taxes he paid in the previous year. Foreign currency deposits are also exempt from attachment
He must also submit a SALN: and garnishment. The law covers the following:
1.) Every year on or before April 15 1. Examination and inquiry into all deposits of
2.) On the expiration of his term of office whatever nature
3.) On his resignation, retirement or separation (read: 2. Disclosure by any official or employee of any
removal) from office banking institution to any unauthorized person of
If he assumes office less than 2 months before the end of any information concerning the deposit in
the calendar year, he can file his SALN on or before April 15 question
of the next year. The exceptions are the following:
Violations with regard to the SALN are punished with a fine 1. Under written permission of the depositor
of Php 1,000-5,000 and/or imprisonment of up to 1year 2. Cases under the Anti-Money Laundering Act
and 6 months. There is no minimum prison term. If the 3. If the money was unlawfully taken and deposited
violation is proven in an administrative proceeding, in a bank, the rightful owner can inquire into the
perpetual dismissal is proper even if there are no criminal deposit in question (GSIS vs. CA, GR 189206, June
charges filed. An elected official who has been dismissed 8, 2011 and China Bank vs. CA, GR 140687,
under RA 3019 can't be reelected. December 18, 2006 -pro hac vice ruling)
If (in accordance with RA 1379) an official during his 4. Under PD 1035, which created the Foreign
incumbency acquires in his name or for other people Currency Deposit System and PD 1246, both of
money or property that is clearly out of proportion to his which amended RA 6426, the protection of RA
salary and other lawful income, that's a ground for 6426 is intended to cover foreign lenders and
dismissal or removal. Properties in the name of his spouse investors, not tourists (Salvacion vs. Central Bank,
and unmarried children will be considered in the GR 94723, August 21, 1997)
investigation if their acquisition through lawful means can't The recent case of PSBank vs. Senate Impeachment Court,
be proven. This includes bank deposits; ergo, this is an GR 200238, February 9, 2012, where PSBank requested a
exception to the bank secrecy law. TRO with regard to Chief Justice Corona's bank account
highlights a need to further improve this law.

RA 6426: Foreign Currency Deposit Act Violations of this law are penalized 1 to 5 years'
imprisonment and/or a fine of Php5,000 to 25,000.
Here's the piece of legislation that's been one of the
significant issues of the Corona impeachment case: RA
6426, the Foreign Currency Deposit Act. The purpose of this RA 9160: Money Laundering
law, when it was enacted, was to protect foreign currency Offenses punishable under RA9160 are the following:
deposits in order to encourage an inflow of foreign capital 1. The crime of money laundering itself
necessary for our country's industries. The law allows 2. Failure to keep records
foreign currencies to be incorporated into the national 3. Failure to report covered transactions
reserve. 4. Malicious reporting
Any person, natural or juridical is allowed to maintain 5. Breach of confidentiality
foreign currency accounts (not just dollars) in banks with Money Laundering
good standing in the Philippines. These banks will be It is a crime where the proceeds of an illegal activity are
designated by the Central Bank. The authorities granted to transacted; consequently making they appear to have come
these banks are as follows: from legitimate sources. It takes the form of the following:
1. Accept deposits and foreign currencies in trust 1.) Any person who knows that any monetary instrument or
(numbered accounts fore servicing and recording property represents, involves or is related to the proceeds
of these deposits is allowed) of any illegal activity but transact/tries to transact the
2. Issue certificates as evidence of these deposits instrument/property anyway
3. To discount these certificates
2.) A person who, knowing that any monetary instrument
or property involves the proceeds from any illegal activity,
performs or fails to perform an act a result of which he a. No underlying legal trade/obligation, purpose or
facilitates the offense of money laundering in the previous economic justification
paragraph b. Client isn't properly identified
3.) If a person knows that any monetary instrument or c. Amount involved isn't commensurate with the
property that is required under the money laundering law client's business or financial capacity
(RA 9160, as amended by RA 9194) to be disclosed and filed d. Client's transaction is structured in order to avoid
with the Anti-Money Laundering Council and fails to do so being subject to the reporting requirements of the
A person can be convicted of both the illegal activity and money laundering act(!)
money laundering. Any case related to the illegal activity, e. Any circumstance related to the transaction is
however, is given precedence over the prosecution of any observed to deviate from the client's profits or his
offense or violation of the money laundering law without past transactions with the covered institution
prejudice to freezing and other remedies. f. The transaction is related to any illegal activity or
offense under the money laundering law and is
The RTC has jurisdiction over money laundering cases
about to be, is being or has been committed
except if the money laundering is committed by public
g. Any transaction similar or analogous to any of the
officers or private persons conspiring with them. In this
above
instance, the case will be tried by the Sandiganbayan.
Unlawful Activities Under RA 9160
Covered Institutions
1.) Kidnapping for ransom
These are the institutions covered under the money
laundering law. They refer to: 2.) Drug trafficking

1.) Banks, non-banks, quasi-banks, trust entities and all 3.) Violations of the Anti-Graft and Corrupt Practices Act
other institutions and their subsidiaries and affiliates under 4.) Plunder
the regulation ans supervision of the Central Bank 5.) Robbery and extortion
2.) Insurance companies and all other institutions 6.) Jueteng and masiao
supervised and regulated by the Insurance Commissioner 7.) Piracy on the high seas
3.) Securities, dealers, brokers, salesmen, investment 8.) Qualified theft
houses an other similar entities managing securities or 9.) Swindling/estafa
rendering services as investment agents, advisers,
10.) Violations of the E-Commerce Act
consultants; mutual funds, close-end investment
11.) Hijacking and other violations of RA 6235
companies and other similar entities; forex corporations,
money changers, money payment, remittance and transfer 12.) Destructive arson and murder, including those
companies and other similar entities; and entities committed by terrorists against non-combatants and
administering or otherwise dealing in currency, similar targets
commodities or financial derivatives based thereon, 13.) Fraudulent practices and other violations under the
valuable objects, cash substitutes and other similar Securities Regulations Code
monetary instruments or property supervised by the SEC 14.) Acts of terrorism
Transactions Covered by RA 9160 15.) Felonies/offenses of a similar nature punishable under
These transactions are reported to the Anti-Money the criminal laws of other countries
Laundering Council within 5 working days from their
occurrence unless the supervising authority prescribes a These crimes can be prosecuted together with the violation
longer period of up to 10 days. This is an exception to the of RA 9160
Bank Secrecy Law, RA 6426, RA 8971 and other similar laws; Penalties:
provided the reporter doesn't communicate any
1.) Imprisonment from 7 to 14 years and a fine of at least
information related to the report to any person.
Php3M, but not to exceed double the value of the
1.) Covered Transaction monetary instrument or property involved in the offense
A transaction in cash or equivalent monetary instrument for the first form of money laundering (see above.)
where the amount exceeds Php500,000.00 in a single 2.) Imprisonment from 4 to 7 years and a fine of between
banking day, Php1.5M to Php3M for the second form of money
2.) Suspicious Transaction laundering (same.)
A transaction with covered institutions, regardless of the 3.) Imprisonment from 6 months to 4 years and/or a fine of
amount involved, if any of the following circumstances are Php100,000.00 to Php500,000.00 for the third form of
present: money laundering (same.)
4.) Imprisonment of 6 months to 1 year and/or a fine of equipment attached to the building –such as when bolted
Php100,000.00 to Php500,000.00 for failure to keep to the floor- ordinarily forms part of the building. But if the
records. contracting parties treat it as chattel, then once again
5.) Imprisonment of 6 months to 4 years and a fine of chattel mortgage takes effect (Tsai vs. CA, see above &
Php100,000.00 to Php500,000.00 for malicious reporting. Davao Sawmill vs. Castillo 61 Phil. 709.)
Also, the offender can't avail of the Probation Law. If the Additional Stuff on Registration
offender is a corporation or any juridical person, the If the mortgage is constituted over a vehicle, it must also be
officers responsible will get this penalty and the juridical made with the LTO (if a private vehicle) or LTFRB (if it’s a
entity's license will be revoked. If the offender is an alien, public vehicle.) If it’s a ship, it’s made with the MARINA.
he will be deported after serving sentence. If the offender If a chattel mortgage is constituted over shares of stock, it
is a public official or employee, perpetual or temporary doesn’t need to be registered in the stock and transfer
absolute disqualification; he will also suffer the same if he book.
refuses or purposely fails to testify.
Formalities
6.) Imprisonment of 3 to 8 years and a fine of Php
1.) Registration
500,000.00 to Php1M for breach of confidentiality. If
Registration should be with the Register of Deeds in the
committed by a media company, the reporter responsible,
place where the owner of the property lives or where the
writer, editor-in-chief, president, publisher and manager
property in question is located. If the owner’s address is
will be held liable.
different from that of the property in question, registration
will have to be done in both RDs.
Act 1508: Chattel Mortgage Registration is in rem and therefore binding against third
This is an old law (it dates to pre-commonwealth times) but persons. If the property isn’t registered, only the
is still relevant today. Chattel mortgage is the rule and the contracting parties will be bound but third persons won’t
Recto law is the exception. Like the Recto law, it covers (Filipinas Marble vs. IAC, 142 SCRA 180.)
movables. 2.) Affidavit of Good Faith
A chattel mortgage is not a conditional sale (Serra vs. The parties must swear that the mortgage is solely for the
Rodriguez, 56 SCRA 538.) It’s a security; an accessory purpose of securing the obligation in the principal contract,
contract where personal property is mortgaged as security that it is a just and valid, for no other purpose whatsoever,
for the performance of an obligation (Art. 2140, Civil Code.) and not entered into in order to commit fraud.
After-acquired Property The affidavit gives the mortgage a preferred status. If there
It can only cover property that has been expressly is no affidavit, the contract is still binding between the
described; substitutes and similar property (after-acquired parties but not on third persons (Phil. Refining vs. Jarque,
property) won’t do (Tsai vs. CA, 366 SCRA 324) unless the 61 Phil. 229.)
after-acquired property in question pertains to stores open Right of Equity of Redemption
to the public. Obviously, it would be ridiculous if you
If the condition of the mortgage is broken, the following
wouldn’t allow the storeowner to replace goods that were
may redeem:
bought by his customers. Instead, the storeowner must be
1.) The mortgagor
allowed to substitute the goods that were sold (Northern
Motors vs. Coquia, 66 SCRA 415.) 2.) A person holding a subsequent mortgage
After-incurred Obligations 3.) A subsequent attaching creditor
The chattel mortgage covers only those obligations that Redemption can’t be exercised, however, after the
existed when the mortgage was constituted. The only time foreclosure sale. And since a chattel mortgage is just a
after-incurred obligations can be included in the agreement security, a foreclosure won’t prevent the mortgagee from
is if the old contract is amended or a new one is drawn up. recovering any deficiency from the foreclosure sale (there’s
The amendment or new contract must be made observing a prescriptive period of 10 years from accrual of a cause of
the formalities of a chattel mortgage. action.) The exception is a sale of personal property. In that
case, the Recto law will apply.
Can a chattel mortgage be constituted on a building?
Ordinarily, the answer would be no. However, if both
parties entered into a chattel mortgage contract over a
piece of real estate, they are now in estoppel and the
contract becomes effective (Tumulad vs. Vicencio, 41 SCRA
143.) A chattel mortgage on a building may be valid
between the parties, but not against third persons
(Evangelista vs. Alto Surety, 103 Phil. 401.) Also, a piece of