SECTION 1. Declaration of Policy.
The State shall maintain a If the dormancy reaches 10 years and there has been no
central monetary authority that shall function and operate as
an independent and accountable body corporate in the
discharge of its mandated responsibilities concerning money,
banking and credit. In line with this policy, and considering its
unique functions and responsibilities, the central monetary
authority established under this Act, while being a
government-owned corporation, shall enjoy fiscal and
administrative autonomy
SEC. 29. Appointment of Conservator. _ Whenever, on the
basis of a report submitted by the appropriate supervising or
examining department, the Monetary Board finds that a bank
or a quasi-bank is in a state of continuing inability or
unwillingness to maintain a condition of liquidity deemed
adequate to protect the interest of depositors and creditors,
the Monetary Board may appoint a conservator with such
powers as the Monetary Board shall deem necessary to take
charge of the assets, liabilities, and the management thereof,
reorganize the management, collect all monies and debts due
said institution, and exercise all powers necessary to restore
its viability. The conservator shall report and be responsible to
the Monetary Board and shall have the power to overrule or
revoke the actions of the previous management and board of
directors of the bank or quasi-bank.
G. “Covered transaction” refers to:
1. A transaction in cash or other equivalent monetary
instrument exceeding Five Hundred Thousand pesos
(Php500,000.00)
2. A transaction exceeding One Million pesos
(Php1,000,000.00) in cases of jewelry dealers, dealers in
precious metals and dealers in precious stones.
H. “Suspicious Transaction” refers to a transaction,
regardless of amount, where any of the following
circumstances exists:
1. there is no underlying legal or trade obligation, purpose or
economic justification;
2. the client is not properly identified;
3. the amount involved is not commensurate with the
business or financial capacity of the client;
4. taking into account all known circumstances, it may be
perceived that the client’s transaction is structured in order to
avoid being the subject of reporting requirements under the
AMLA;
5. any circumstance relating to the transaction which is
observed to deviate from the profile of the client and/or the
client’s past transactions with the covered person;
6. the transaction is in any way related to an unlawful activity
or any money laundering activity or offense that is about to be
committed, is being or has been committed; or
7. any transaction that is similar, analogous or identical to
any of the foregoing.
reactivation or withdrawal as above mentioned, the deposit
accounts are classified as unclaimed balances subject to
escheat in favor of the Government as provided under the
Unclaimed Balances Law (Act No. 3936). If after the
proceedings the property remains without a lawful owner
interested to claim it, the property shall be reverted to the
State to forestall an open invitation to self-service by the first
comers. However, if interested parties have come forward
and laid claim to the property, the courts shall determine
whether the credit or deposit should pass to the claimants or
be forfeited in favor of the State. (Rizal Commercial Banking
Corporation vs. Hi-Tri Dev. Corp., G.R. No. 192413, June 13,
2012).
Banks are required to submit to the Treasurer of the
Philippines in January of every odd year such list of unclaimed
balances, which the Treasurer will then submit to the Solicitor
General.It will then be the duty of the Solicitor General to file
a petition in court so that a judgment be issued declaring the
unclaimed balances to have been escheated in favor of the
Government. After escheat, legal title to the funds rests on
the State.
As may be noted, title to the unclaimed balances would vest
on the State only upon finality of the escheat judgment.
Before title is vested on the State, the funds would still be
recoverable since, on record, the deposit is still traceable to
the ownership by the depositor. Thus, it is not automatic that
the depositor would lose ownership over the deposit by the
mere fact that it has been dormant or inactive for 10 years.
The appropriate recourse for that depositor to do is to follow
up the status of the account and if no judgment of escheat is
issued yet, to file the legal documents and prove before the
court his or her entitlement to the recovery and withdrawal of
the deposit.
PDIC provides a maximum deposit insurance coverage of
PhP500,000 per depositor per bank. It covers all types of bank
deposits in banks whether denominated in local or foreign
currencies. All deposit accounts of a depositor in a closed bank
maintained in the same right and capacity shall be added
together. A joint account shall be insured separately from any
individually-owned deposit account. PDIC member banks
include the following institutions authorized by the Bangko
Sentral ng Pilipinas (BSP) to perform banking functions in the
Philippines:
• Banks incorporated under Philippine laws, such as
commercial banks, savings banks, mortgage banks,
development banks, rural banks and cooperative banks and
stock savings and loan associations.
• Domestic branches of foreign banks
PDIC insures valid deposits in domestic offices of its member
banks.
The Bank Secrecy Law protects all deposits of whatever
nature in banks or banking institutions in the Philippines as
well as investments in government bond. This law prohibits
any person, subject to the exceptions below, from disclosing entrustee fails to turn over the proceeds of the sale of goods
to any person any information, relative to the funds or covered by the trust receipt to the entruster; or (2) when the
properties belonging to the depositors in the custody of the entrustee fails to return the goods under trust, if they are not
bank. Simply put, no one can just go to your bank and ask for disposed of in accordance with the terms of the trust receipts.
your bank balance.
However, the rule is not absolute. The following are the Money laundering involves three steps: The first involves
exceptions to the bank secrecy law: introducing cash into the financial system by some means
1. Written permission or consent in writing by the depositor; ("placement"); the second involves carrying out complex
2. In cases of impeachment; financial transactions to camouflage the illegal source of the
3. Upon order of the court in cases of bribery or dereliction of cash ("layering"); and finally, acquiring wealth generated from
duty of public officials; the transactions of the illicit funds ("integration"). Some of
4. Upon order of the court in cases where the money these steps may be omitted, depending upon the
deposited or invested is the subject matter of the litigation; circumstances. For example, non-cash proceeds that are
5. Upon a subpoena issued by the Ombudsman concerning an already in the financial system would not need to be placed.
investigation it is conducting, provided that there must (e) Safe Harbor Provision. No administrative, criminal or civil
already be a case pending in court, the account be clearly proceedings shall lie against any person for having made a
identified, the inspection be limited to the subject matter of covered transaction report in the regular performance of his
the pending case; and the bank personnel and the depositor duties and in good faith, whether or not such reporting results
must be notified to be present during the inspection; in any criminal prosecution under the AMLA or any other
6. The BIR can inquire into bank deposits in an application for Philippine law.
compromise of tax liability or determination of a decedent’s
gross estate;
7. The Anti-Money Laundering Council (“AMLC”) can examine
bank accounts pursuant to a court order, where there is
probable cause that the deposits are related to an unlawful
activity or money laundering offense;
8. The AMLC can examine bank accounts, WITHOUT a court
order, where there is probable cause that the deposits are
related to certain crimes such as kidnapping for ransom,
violation of the Dangerous Drugs Act, hijacking, destructive
arson, murder and violations of RA 6235 (acts inimical to civil
aviation);
9. The Bangko Sentral can examine bank accounts in the
course of its periodic or special examination regarding
compliance with Anti-Money Laundering Law.

PDIC shall pay deposit insurance on all valid deposits up to the

Maximum Deposit Insurance Coverage of Php500,000, per
depositor, of a closed bank. Accounts maintained in the same
right and capacity for a depositor’s benefit, whether in his own
name or in the name of others, are covered by deposit
insurance.

In the case where a depositor is the sole beneficial owner of a

single, “For the Account of”, “By”, and “In Trust For” accounts,
the consolidated balances of these accounts shall be insured
up to Php500,000. The depositor’s total shares in his/her joint
accounts shall be separately insured up to
Php500,000. A depositor with single accounts and joint
accounts may have insured deposits of up to Php1,000,000.

There are two obligations in a trust receipt transaction. The

first is covered by the provision that refers to money under the
obligation to deliver it (entregarla) to the owner of the
merchandise sold. The second is covered by the provision
referring to merchandise received under the obligation to
return it (devolvera) to the owner. Thus, under the Trust
Receipts Law,[22] intent to defraud is presumed when (1) the