BSP may conduct annual testing solely limited to the
I. ANTI-MONEY LAUNDERING ACT (RA
9160, as amended)***
A. Covered institutions and their
obligations* – Secs 3 (a) covered persons, 9,
14 (e ), (f) and (g)  di ko alam san yan!
SEC. 3. Definitions. — For purposes of this Act, the
following terms are hereby defined as follows:
(a) “Covered institution” refers to:
(1) banks, non-banks, quasi-banks, trust entities, and
all other institutions and their subsidiaries and
affiliates supervised or regulated by the Bangko
Sentral ng Pilipinas (BSP);
(2) insurance companies and all other institutions
supervised or regulated by the Insurance Commission;
and
(3) (i) securities dealers, brokers, salesmen,
investment houses and other similar entities managing
securities or rendering services as investment agent,
advisor, or consultant, (ii) mutual funds, closed-end
investment companies, common trust funds, pre-need
companies and other similar entities, (iii) foreign
exchange corporations, money changers, money
payment, remittance, and transfer companies and other
similar entities, and (iv) other entities administering or
otherwise dealing in currency, commodities or
financial derivatives based thereon, valuable objects,
cash substitutes and other similar monetary
instruments or property supervised or regulated by
Securities and Exchange Commission.
SEC. 9. Prevention of Money Laundering; Customer
Identification Requirements and Record Keeping. —
(a) Customer Identification. — Covered institutions
shall establish and record the true identity of its clients
based on official documents. They shall maintain a
system of verifying the true identity of their clients
and, in case of corporate clients, require a system of
verifying their legal existence and organizational
structure, as well as the authority and identification of
all persons purporting to act on their behalf.
The provisions of existing laws to the contrary
notwithstanding, anonymous accounts, accounts under
fictitious names, and all other similar accounts shall be
absolutely prohibited. Peso and foreign currency non-
checking numbered accounts shall be allowed. The
determination of the existence and true identity of the
owners of such accounts.
(b) Record Keeping. — All records of all transactions
of covered institutions shall be maintained and safely
stored for five (5) years from the dates of transactions.
With respect to closed accounts, the records on
customer identification, account files and business
correspondence, shall be preserved and safely stored
for at least five (5) years from the dates when they
were closed.
(c) Reporting of Covered Transactions. — Covered
institutions shall report to the AMLC all covered
transactions within five (5) working days from
occurrence thereof, unless the Supervising Authority
concerned prescribes a longer period not exceeding ten
(10) working days.
When reporting covered transactions to the AMLC,
covered institutions and their officers, employees,
representatives, agents, advisors, consultants or
associates shall not be deemed to have violated
Republic Act No. 1405, as amended; Republic Act No.
6426, as amended; Republic Act No. 8791 and other
similar laws, but are prohibited from communicating,
directly or indirectly, in any manner or by any means,
to any person the fact that a covered transaction report
was made, the contents thereof, or any other
information in relation thereto. In case of violation
thereof, the concerned officer, employee,
representative, agent, advisor, consultant or associate
of the covered institution, shall be criminally liable.
However, no administrative, criminal or civil
proceedings, shall lie against any person for having
made a covered transaction report in the regular
performance of his duties and in good faith, whether
or not such reporting results in any criminal
prosecution under this Act or any other Philippine law.
When reporting covered transactions to the AMLC,
covered institutions and their officers, employees,
representatives, agents, advisors, consultants or
associates are prohibited from communicating,
directly or indirectly, in any manner or by any means,
to any person, entity, the media, the fact that a covered
transaction report was made, the contents thereof, or
any other information in relation thereto. Neither may
such reporting be published or aired in any manner or
form by the mass media, electronic mail, or other
similar devices. In case of violation thereof, the
concerned officer, employee, representative, agent,
advisor, consultant or associate of the covered
institution, or media shall be held criminally liable.
SEC. 10. Authority to Freeze. — Upon determination
that probable cause exists that any deposit or similar
account is in any way related to an unlawful activity,
the AMLC may issue a freeze order, which shall be
effective immediately, on the account for a period not
exceeding fifteen (15) days. Notice to the depositor
that his account has been frozen shall be issued
simultaneously with the issuance of the freeze order.
The depositor shall have seventy-two (72) hours upon
receipt of the notice to explain why the freeze order
should be lifted. The AMLC has seventy-two (72)
hours to dispose of the depositor’s explanation. If it
fails to act within seventy-two (72) hours from receipt
of the depositor’s explanation, the freeze order shall
automatically be dissolved. The fifteen (15)-day freeze
order of the AMLC may be extended upon order of the
court, provided that the fifteen (15)-day period shall be
tolled pending the court’s decision to extend the
period.
No court shall issue a temporary restraining order or
writ of injunction against any freeze order issued by
the AMLC except the Court of Appeals or the Supreme
Court.
SEC. 11. Authority to Inquire into Bank Deposits. —
Notwithstanding the provisions of Republic Act No.
1405, as amended; Republic Act No. 6426, as
amended; Republic Act No. 8791, and other laws, the
AMLC may inquire into or examine any particular
deposit or investment with any banking institution or
non-bank financial institution upon order of any
competent court in cases of violation of this Act when
it has been established that there is probable cause that
the deposits or investments involved are in any way
related to a money laundering offense: Provided, That
this provision shall not apply to deposits and
investments made prior to the effectivity of this Act.
SEC. 12. Forfeiture Provisions.
(a) Civil Forfeiture. — When there is a covered
transaction report made, and the court has, in a petition
filed for the purpose ordered seizure of any monetary
instrument or property, in whole or in part, directly or
indirectly, related to said report, the Revised Rules of
Court on civil forfeiture shall apply.
(b) Claim on Forfeiture Assets. — Where the court has
issued an order of forfeiture of the monetary
instrument or property in a criminal prosecution for
any money laundering offense defined under Section
4 of this Act, the offender or any other person claiming
an interest therein may apply, by verified petition, for
a declaration that the same legitimately belongs to him
and for segregation or exclusion of the monetary
instrument or property corresponding thereto. The
verified petition shall be filed with the court which
rendered the judgment of conviction and order of
forfeiture, within fifteen (15) days from the date of the
order of forfeiture, in default of which the said order
shall become final and executory. This provision shall
apply in both civil and criminal forfeiture.
(c) Payment in Lieu of Forfeiture. — Where the court
has issued an order of forfeiture of the monetary
instrument or property subject of a money laundering
offense defined under Section 4, and said order cannot
be enforced because any particular monetary
instrument or property cannot, with due diligence, be
located, or it has been substantially altered, destroyed,
diminished in value or otherwise rendered worthless
by any act or omission, directly or indirectly,
attributable to the offender, or it has been concealed,
removed, converted or otherwise transferred to
prevent the same from being found or to avoid
forfeiture thereof, or it is located outside the
Philippines or has been placed or brought outside the
jurisdiction of the court, or it has been commingled
with other monetary instruments or property belonging
to either the offender himself or a third person or
entity, thereby rendering the same difficult to identify
or be segregated for purposes of forfeiture, the court
may, instead of enforcing the order of forfeiture of the
monetary instrument or property or part thereof or
interest therein, accordingly order the convicted
offender to pay an amount equal to the value of said
monetary instrument or property. This provision shall
apply in both civil and criminal forfeiture.
Land Bank v Artemio San Juan Jr. GR
186279 Apr 2, 2013
A certain Esmayatin Bonsalagan approached the
respondent in his office at LBP-Binangonan Branch to
encash a check for Twenty-Six Billion pesos.
Respondent then summoned to his office Acsa
Ramirez, the Cashier/Operations Supervisor, and Leila
Amparo, the Teller/Designated New Accounts Clerk,
and informed them of Bonsalagan’s desire to partially
withdraw funds on the check. He also told them that
the P26-Billion check had already been confirmed by
China Bank. Ramirez expressed her reservation to the
client’s request because, as a matter of bank procedure
and policy, the check must first be cleared before funds
could be withdrawn.
To accommodate the client, the respondent suggested
that Bonsalagan open a current/checking account with
the branch where the China Bank check would first be
deposited. Ramirez, who assisted in opening the
checking account, required Bonsalagan to present at
least two 2 IDs but the latter could only present one
ID. The respondent assured Ramirez that it was alright
to proceed with the opening of the checking account
because Bonsalagan had previously presented the
proper IDs, being a signatory to an existing account
with the branch. The respondent also approved and
authenticated Bonsalagan’s specimen signature cards.
Bonsalagan was consequently issued a check booklet.
Against the respondent’s advice, Ramirez immediately
called the Area Head Office to report the China Bank
check.
After an investigation, the LBP discovered that the
P26-Billion check was spurious and unfunded, and
that the check’s account number did not belong to CQ
Ventures Corporation, but to a certain Jing Limbo
and/or Arien Romero. This discovery prompted the
LBP to issue a Formal Charge against the respondent
with the Office of the Government Corporate Counsel
(OGCC) where it accused the respondent of gross
neglect of duty for the following acts or omissions
detrimental to the bank’s interest: (a) in ordering that
a current account be opened without properly
verifying the depositor’s identity in accordance with
the bank’s policy; (b) in not confirming the
genuineness of the China Bank check and the
legitimacy and sufficiency of its funds; and (c) in
issuing a check booklet to Bonsalagan without waiting
for the China Bank check to be cleared. The
respondent was preventively suspended  GUILTY.
SC:
Respondent failed to exert prompt efforts in
confirming the genuineness and source of
Bonsalagan’s P26-Billion check.
Due to the nature of his Bank Manager position, it was
inevitable for the respondent to encounter and process,
on a daily basis, checks of enormous amounts, ranging
from thousands to millions of pesos. However, we find
the enormity of the amount of Bonsalagan’s check,
i.e., P26 Billion, to be exceptional and far from the
usual bank transactions. This kind of unusual, even
suspicious, transaction warranted a more guarded and
prompt response from the respondent.
We recall that it was through Ramirez’s initiative, and
not the respondent’s, that the unusually enormous
check was immediately reported to the LBP Area Head
Office. Strangely, the respondent, with apparent
insensitivity to the circumstances of the situation,
wanted to wait until the next working day to report the
check. Such relaxed response cannot but be a
confirmation of his disregard of and lack of concern
for the bank’s interests, which he was duty-bound to
protect.
We likewise discern from the respondent’s actuations
that he was not only grossly negligent in the
performance of his duties, but was also instrumental in
perpetuating a fraud against the bank. The respondent
cannot deny that he solicited Bonsalagan’s account,
allegedly to improve the bank’s deposit portfolio. The
day before Bonsalagan arrived at the LBP-Binangonan
Branch, the respondent already advised Ramirez of
Bonsalagan’s arrival and the presentation of the P26-
Billion check. And on the day the client arrived at the
bank, the respondent vouched for Bonsalagan’s
identity and for the supposed confirmation by China
Bank of the P26-Billion check.
A bank manager has the duty to ensure that bank
rules are strictly complied with, not only to ensure
efficient bank operation, but also to serve the bank’s
best interest. His responsibility over the functions of
the employees of the branch cannot simply be
overlooked as their acts normally pass through his
supervision and approval. He should serve as the last
safeguard against any pretense employed to carry out
an illicit claim over the bank’s money.
Subido et al v CA GR 216914 Dec 6, 2016
Facts
Challenged in this petition for certiorari and
prohibition under Rule 65 of the Rules of Court is the
constitutionality of Section 11 of R.A No. 9160, the
Anti-Money Laundering Act, as amended, specifically
the Anti-Money Laundering Council's authority to file
with the Court of Appeals (CA) in this case, an ex-
parte application for inquiry into certain bank deposits
and investments, including related accounts based on
probable cause.
In 2015, a year before the 2016 presidential elections,
reports abounded on the supposed disproportionate
wealth of then Vice President Jejomar Binay and the
rest of his family, some of whom were likewise elected
public officers. The Office of the Ombudsman and the
Senate conducted investigations and inquiries
thereon.
From various news reports announcing the inquiry into
then Vice President Binay's bank accounts, including
accounts of members of his family, petitioner Subido
Pagente Certeza Mendoza & Binay Law Firm
(SPCMB) was most concerned with the article
published in the Manila Times on 25 February 2015
entitled "Inspect Binay Bank Accounts" which read, in
pertinent part:
xxx The Anti-Money Laundering Council (AMLC)
asked the Court of Appeals (CA) to allow the
[C]ouncil to peek into the bank accounts of the Binays,
their corporations, and a law office where a family
member was once a partner.
xx xx
Also the bank accounts of the law office linked to the
family, the Subido Pagente Certeza Mendoza & Binay
Law Firm, where the Vice President's daughter Abigail
was a former partner.
By 8 March 2015, the Manila Times published another
article entitled, "CA orders probe of Binay 's assets"
reporting that the appellate court had issued a
Resolution granting the ex-parte application of the
AMLC to examine the bank accounts of SPCMB.
Forestalled in the CA thus alleging that it had no
ordinary, plain, speedy, and adequate remedy to
protect its rights and interests in the purported ongoing
unconstitutional examination of its bank accounts by
public respondent Anti-Money Laundering Council
(AMLC), SPCMB undertook direct resort to this Court
via this petition for certiorari and prohibition on the
following grounds that the he Anti-Money Laundering
Act is unconstitutional insofar as it allows the
examination of a bank account without any notice to
the affected party: (1) It violates the person's right to
due process; and (2) It violates the person's right to
privacy.
Issues:
1. Whether Section 11 of R.A No.
9160 violates substantial due process.
2. Whether Section 11 of R.A No.
9160 violates procedural due process.
3. Whether Section 11 of R.A No.
9160 is violative of the constitutional right to
privacy enshrined in Section 2, Article III of
the Constitution.
Rulings
1. No. We do not subscribe to SPCMB' s position.
Succinctly, Section 11 of the AMLA providing for ex-
parte application and inquiry by the AMLC into
certain bank deposits and investments does not violate
substantive due process, there being no physical
seizure of property involved at that stage.
In fact, .Eugenio delineates a bank inquiry order under
Section 11 from a freeze order under Section 10 on
both remedies' effect on the direct objects, i.e. the bank
deposits and investments:
On the other hand, a bank inquiry order under Section
11 does not necessitate any form of physical seizure of
property of the account holder. What the bank inquiry
order authorizes is the examination of the particular
deposits or investments in banking institutions or non-
bank financial institutions. The monetary instruments
or property deposited with such banks or financial
institutions are not seized in a physical sense, but are
examined on particular details such as the account
holder's record of deposits and transactions. Unlike the
assets subject of the freeze order, the records to be
inspected under a bank inquiry order cannot be
physically seized or hidden by the account holder. Said
records are in the possession of the bank and therefore
cannot be destroyed at the instance of the account
holder alone as that would require the extraordinary
cooperation and devotion of the bank.
At the stage in which the petition was filed before us,
the inquiry into certain bank deposits and investments
by the AMLC still does not contemplate any form of
physical seizure of the targeted corporeal property.
2. No. The AMLC functions solely as an investigative
body in the instances mentioned in Rule 5.b.26
Thereafter, the next step is for the AMLC to file a
Complaint with either the DOJ or the Ombudsman
pursuant to Rule 6b. Even in the case of Estrada v.
Office of the Ombudsman, where the conflict arose at
the preliminary investigation stage by the
Ombudsman, we ruled that the Ombudsman's denial of
Senator Estrada's Request to be furnished copies of the
counter-affidavits of his co-respondents did not violate
Estrada's constitutional right to due process where the
sole issue is the existence of probable cause for the
purpose of determining whether an information should
be filed and does not prevent Estrada from requesting
a copy of the counter-affidavits of his co-respondents
during the pre-trial or even during trial.
Plainly, the AMLC's investigation of money
laundering offenses and its determination of possible
money laundering offenses, specifically its inquiry
into certain bank accounts allowed by court order,
does not transform it into an investigative body
exercising quasi-judicial powers. Hence, Section 11 of
the AMLA, authorizing a bank inquiry court order,
cannot be said to violate SPCMB's constitutional right
to due process.
3. No. We now come to a determination of whether
Section 11 is violative of the constitutional right to
privacy enshrined in Section 2, Article III of the
Constitution. SPCMB is adamant that the CA's denial
of its request to be furnished copies of AMLC's ex-
parte application for a bank inquiry order and all
subsequent pleadings, documents and orders filed and
issued in relation thereto, constitutes grave abuse of
discretion where the purported blanket authority under
Section 11: ( 1) partakes of a general warrant intended
to aid a mere fishing expedition; (2) violates the
attorney-client privilege; (3) is not preceded by
predicate crime charging SPCMB of a money
laundering offense; and ( 4) is a form of political
harassment [of SPCMB' s] clientele.
We thus subjected Section 11 of the AMLA to
heightened scrutiny and found nothing arbitrary in the
allowance and authorization to AMLC to undertake an
inquiry into certain bank accounts or deposits. Instead,
we found that it provides safeguards before a bank
inquiry order is issued, ensuring adherence to the
general state policy of preserving the absolutely
confidential nature of Philippine bank accounts:
1. The AMLC is required to establish
probable cause as basis for its ex-parte
application for bank inquiry order;
2. The CA, independent of the
AMLC's demonstration of probable cause,
itself makes a finding of probable cause that
the deposits or investments are related to an
unlawful activity under Section 3(i) or a
money laundering offense under Section 4 of
the AMLA;
3. A bank inquiry court order ex-parte
for related accounts is preceded by a bank
inquiry court order ex-parte for the principal
account which court order ex-parte for related
accounts is separately based on probable
cause that such related account is materially
linked to the principal account inquired into;
and
4. The authority to inquire into or
examine the main or principal account and
the related accounts shall comply with the
requirements of Article III, Sections 2 and 3
of the Constitution. The foregoing
demonstrates that the inquiry and
examination into the bank account are not
undertaken whimsically and solely based on
the investigative discretion of the AMLC. In
particular, the requirement of demonstration
by the AMLC, and determination by the CA,
of probable cause emphasizes the limits of
such governmental action. We will revert to
these safeguards under Section 11 as we
specifically discuss the CA' s denial of
SPCMB' s letter request for information
concerning the purported issuance of a bank
inquiry order involving its accounts.
All told, we affirm the constitutionality of Section 11
of the AMLA allowing the ex-parte application by the
AMLC for authority to inquire into, and examine,
certain bank deposits and investments.
WHEREFORE, the petition is DENIED. Section 11
of Republic Act No. 9160, as amended, is
declared VALID and CONSTITUTIONAL.
B. Covered and suspicious
transactions – Sec 3 (b)
(b) “Covered transaction” is a single, series, or
combination of transactions involving a total amount
in excess of Four million Philippine pesos
(Php4,000,000.00) or an equivalent amount in foreign
currency based on the prevailing exchange rate within
five (5) consecutive banking days except those
between a covered institution and a person who, at the
time of the transaction was a properly identified client
and the amount is commensurate with the business or
financial capacity of the client; or those with an
underlying legal or trade obligation, purpose, origin or
economic justification.
It likewise refers to a single, series or combination or
pattern of unusually large and complex transactions in
excess of Four million Philippine pesos
(Php4,000,000.00) especially cash deposits and
investments having no credible purpose or origin,
underlying trade obligation or contract.
C. Safe harbor provision – Sec 9 (c)
(c) Reporting of Covered Transactions. — Covered
institutions shall report to the AMLC all covered
transactions within five (5) working days from
occurrence thereof, unless the Supervising Authority
concerned prescribes a longer period not exceeding ten
(10) working days.
When reporting covered transactions to the AMLC,
covered institutions and their officers, employees,
representatives, agents, advisors, consultants or (3) Section 3 paragraphs B, C, E, G, H and I of
associates shall not be deemed to have violated Republic Act No. 3019, as amended; otherwise known
Republic Act No. 1405, as amended; Republic Act No. as the Anti-Graft and Corrupt Practices Act;
6426, as amended; Republic Act No. 8791 and other
similar laws, but are prohibited from communicating, (4) Plunder under Republic Act No. 7080, as amended;
directly or indirectly, in any manner or by any means,
to any person the fact that a covered transaction report
(5) Robbery and extortion under Articles 294, 295,
was made, the contents thereof, or any other 296, 299, 300, 301 and 302 of the Revised Penal Code,
information in relation thereto. In case of violation as amended;
thereof, the concerned officer, employee,
representative, agent, advisor, consultant or associate
of the covered institution, shall be criminally liable. (6) Jueteng and Masiao punished as illegal gambling
However, no administrative, criminal or civil under Presidential Decree No. 1602;
proceedings, shall lie against any person for having
made a covered transaction report in the regular (7) Piracy on the high seas under the Revised Penal
performance of his duties and in good faith, whether Code, as amended and Presidential Decree No. 532;
or not such reporting results in any criminal
prosecution under this Act or any other Philippine law. (8) Qualified theft under Article 310 of the Revised
Penal Code, as amended;
When reporting covered transactions to the AMLC,
covered institutions and their officers, employees, (9) Swindling under Article 315 of the Revised Penal
representatives, agents, advisors, consultants or Code, as amended;
associates are prohibited from communicating,
directly or indirectly, in any manner or by any means, (10) Smuggling under Republic Act Nos. 455 and
to any person, entity, the media, the fact that a covered 1937;
transaction report was made, the contents thereof, or
any other information in relation thereto. Neither may
(11) Violations under Republic Act No. 8792,
such reporting be published or aired in any manner or
otherwise known as the Electronic Commerce Act of
form by the mass media, electronic mail, or other
2000;
similar devices. In case of violation thereof, the
concerned officer, employee, representative, agent,
advisor, consultant or associate of the covered (12) Hijacking and other violations under Republic
institution, or media shall be held criminally liable. Act No. 6235; destructive arson and murder, as
defined under the Revised Penal Code, as amended,
including those perpetrated by terrorists against non-
combatant persons and similar targets;
D. When is money laundering
(13) Fraudulent practices and other violations under
committed (including predicate crimes) –
Republic Act No. 8799, otherwise known as the
Secs 3 (i) unlawful activity*, 4 (money
Securities Regulation Code of 2000;
laundering offense), 6

(14) Felonies or offenses of a similar nature that are

punishable under the penal laws of other countries.
Sec. 3 (i) “Unlawful activity”  refers to any act or
omission or series or combination thereof involving or
having relation to the following: SEC. 4. Money Laundering Offense. — Money
laundering is a crime whereby the proceeds of an
unlawful activity are transacted, thereby making them
(1) Kidnapping for ransom under Article 267 of Act
appear to have originated from legitimate sources. It is
No. 3815, otherwise known as the Revised Penal
committed by the following:
Code, as amended;

(a) Any person knowing that any monetary instrument

or property represents, involves, or relates to, the
(2) Sections 3, 4, 5, 7, 8 and 9 of Article Two of
proceeds of any unlawful activity, transacts or
Republic Act No. 6425, as amended, otherwise known
attempts to transact said monetary instrument or
as the Dangerous Drugs Act of 1972;
property.
(b) Any person knowing that any monetary instrument
or property involves the proceeds of any unlawful
activity, performs or fails to perform any act as a result
of which he facilitates the offense of money laundering
referred to in paragraph (a) above.
(c) Any person knowing that any monetary instrument
or property is required under this Act to be disclosed
and filed with the Anti-Money Laundering Council
(AMLC), fails to do so.
SEC. 6. Prosecution of Money Laundering.
(a) Any person may be charged with and convicted of
both the offense of money laundering and the unlawful
activity as herein defined.
(b) Any proceeding relating to the unlawful activity
shall be given precedence over the prosecution of any
offense or violation under this Act without prejudice
to the freezing and other remedies provided.
PDIC v Manu Gidwani GR 234616 Jun 20,
2018
Doctrine:
Section 4. Money Laundering Offense. — Money
laundering is a crime whereby the proceeds of an
unlawful activity are transacted, thereby making them
appear to have originated from legitimate sources. It is
committed by the following:
a. Any person knowing that any monetary
instrument or property represents, involves,
or relates to the proceeds of any unlawful
activity, transacts or attempts to transact said
monetary instrument or property.
Emergency Recit
Pursuant to several resolutions of the Monetary Board
of the BSP, the subject rural banks which are owned
and controlled by the Legacy Group of Companies
were ordered closed. The Philippine Deposit Insurance
Corporation (PDIC) thereafter placed the subject
banks under receivership. Respondent Manu and 86
other complainants who represented themselves to
own 471 deposit accounts with the Legacy Group, and
also subsequently filed claims with the PDIC. The
claims were processed and granted. 683 Landbank
cross checks were issued in favor of the 86 individuals,
excluding Spouses Gidwani amounting to
P98,733,690.21. The checks stated “Payable to
Payee’s Account Only”. Despite these explicit
instructions, the individuals did not deposit the crossed
checks in their respective bank accounts. Rather, the
face value of all the checks were credited to a single
account with Rizal Commercial Banking Corporation
(RCBC), owned by Manu.
PDIC conducted an investigation upon clearing of the
checks. The investigation found that based on
available bank documents, the spouses Gidwani and
the 86 individuals maintained a total of 471 deposit
accounts aggregating P118,187,500 with the different
Legacy Banks, and that 142 of these accounts, with the
total amount of P20,966,439.09, were in the names of
helpers and rank-and-􏰀le employees of the Gidwani
spouses. Thus, they allegedly did not have the
financial capacity to deposit the amounts recorded
under their names, let alone make the deposits in
various Legacy Banks located nationwide. PDIC
likewise noted that advance interests on several of the
deposits were paid to the Gidwani spouses even
though they are not the named owners of the accounts.
Hence, PDIC contends that complainants are not
entitled to the value of the checks since they were not
the true owners, and Spouses Gidwani were the true
beneficial owners. This prompted PDIC to file a
criminal complaint before the DOJ Task Force for
estafa through falsification punished by the RPC and
for money laundering as defined in Section 4 (a) of
AMLA against the Gidwani spouses and the 86 other
individuals.
DOJ Task Force dismissed the criminal complaint for
lack of probable cause. Upon appeal to the Secretary
of Justice, the decision was reversed. CA reversed
DOJ Sec. Hence, this petition.
Issue: W/N there is probable cause to charge
respondents with money laundering.
Held: Yes. Decision of CA was reversed and reinstated
the decision of DOJ Sec. There exists probable cause
to charge respondents with estafa and money
laundering. Under RA 9160, the law provides that:
Section 4. Money Laundering Offense. — Money
laundering is a crime whereby the proceeds of an
unlawful activity are transacted, thereby making them
appear to have originated from legitimate sources. It is
committed by the following:
a. Any person knowing that any monetary
instrument or property represents, involves,
or relates to the proceeds of any unlawful
activity, transacts or attempts to transact said
monetary instrument or property.
In this case, the PDIC reportedly discovered that there
was only one beneficial owner of the 471 bank
accounts with the Legacy Banks of the 86 individual
depositors — respondent Manu. To illustrate, PDIC
reportedly discovered that 142 of these 471 accounts,
with the total amount of P20,966,439.09, were in the
names of helpers and rank-and-file employees of the
Gidwani spouses who do not have the financial
capacity to deposit the amounts recorded under their
names. That these individuals reported either
respondent Manu's office or business address as their
own further arouses serious suspicion on the true
ownership of the funds deposited. It gives the
impression that they had been used by respondent as
dummies, and their purported ownership mere
subterfuge, in order to increase the amount of his
protected deposit. Despite allegations of respondents
that there is an existing agreement of fund
management scheme between respondent Manu and
the individual depositors, it is best left to be threshed
out during trial proper. Suffice it to state for now that
the Court herein finds probable cause to charge
respondent for estafa and money laundering.
E. Authority to inquire into bank
deposits –Sec 11
SEC. 11. Authority to Inquire into Bank Deposits. —
Notwithstanding the provisions of Republic Act No.
1405, as amended; Republic Act No. 6426, as
amended; Republic Act No. 8791, and other laws, the
AMLC may inquire into or examine any particular
deposit or investment with any banking institution or
non-bank financial institution upon order of any
competent court in cases of violation of this Act when
it has been established that there is probable cause that
the deposits or investments involved are in any way
related to a money laundering offense: Provided, That
this provision shall not apply to deposits and
investments made prior to the effectivity of this Act.
Republic v Eugenio Jr. (prior to
amendment);
FACTS:
The Republic, through the AMLC, filed an
application21 before the Manila RTC to inquire into
and/or examine thirteen (13) accounts and two (2)
related web of accounts alleged as having been used to
facilitate corruption in the NAIA 3 Project. Among
said accounts were the DBS Bank account of Alvarez
and the Metrobank accounts of Cheng Yong. The case
was raffled to Manila RTC, Branch 24, presided by
respondent Judge Antonio Eugenio, Jr., and docketed
as SP Case No. 06-114200.
On 12 January 2006, the Manila RTC issued an Order
(Manila RTC bank inquiry order) granting the Ex
Parte Application expressing therein "[that] the
allegations in said application to be impressed with
merit, and in conformity with Section 11 of R.A. No.
9160, as amended, otherwise known as the Anti-
Money Laundering Act (AMLA) of 2001 and Rules
11.1 and 11.2 of the Revised Implementing Rules and
Regulations."22 Authority was thus granted to the
AMLC to inquire into the bank accounts listed
therein.
Lilia Cheng imputed grave abuse of discretion on the
part of the Makati and Manila RTCs in granting
AMLC’s ex parte applications for a bank inquiry
order, arguing:
1. that the ex parte applications violated her
constitutional right to due process
2. that the bank inquiry order under the AMLA
can only be granted in connection with
violations of the AMLA
3. that the AMLA can not apply to bank
accounts opened and transactions entered
into prior to the effectivity of the AMLA or
to bank accounts located outside the
Philippines.
CA hearing Lilia Cheng’s petition had granted a writ
of preliminary injunction in her favor.
ISSUE:
WON a bank inquiry order in this case may be issued
ex parte - no
HELD:
Even if the bank inquiry order may be availed of
without need of a pre-existing case under the AMLA,
it does not follow that such order may be availed of ex
parte. There are several reasons why the AMLA does
not generally sanction ex parte applications and
issuances of the bank inquiry order.
SEC. 11. Authority to Inquire into Bank
Deposits. ― Notwithstanding the provisions
of Republic Act No. 1405, as amended,
Republic Act No. 6426, as amended,
Republic Act No. 8791, and other laws, the
AMLC may inquire into or examine any
particular deposit or investment with any
 banking institution or non bank financial
institution upon order of any competent court
in cases of violation of this Act, when it has
been established that there is probable
cause that the deposits or investments are
related to an unlawful activity as defined
in Section 3(i) hereof or a money
laundering offense under Section 4 hereof,
except that no court order shall be
required in cases involving unlawful
activities defined in Sections 3(i)1, (2) and
(12).
To ensure compliance with this Act, the
Bangko Sentral ng Pilipinas (BSP) may
inquire into or examine any deposit of
investment with any banking institution or
non bank financial institution when the
examination is made in the course of a
periodic or special examination, in
accordance with the rules of examination of
the BSP.70 (Emphasis supplied)
Of course, Section 11 also allows the AMLC to inquire
into bank accounts without having to obtain a judicial
order in cases where there is probable cause that the
deposits or investments are related to kidnapping for
ransom,71certain violations of the Comprehensive
Dangerous Drugs Act of 2002,72 hijacking and other
violations under R.A. No. 6235, destructive arson and
murder. Since such special circumstances do not apply
in this case, there is no need for us to pass comment on
this proviso. Suffice it to say, the proviso contemplates
a situation distinct from that which presently confronts
us, and for purposes of the succeeding discussion, our
reference to Section 11 of the AMLA excludes said
provison.
In the instances where a court order is required for the
issuance of the bank inquiry order, nothing in Section
11 specifically authorizes that such court order may be
issued ex parte. It might be argued that this silence
does not preclude the ex parte issuance of the bank
inquiry order since the same is not prohibited under
Section 11. Yet this argument falls when the
immediately preceding provision, Section 10, is
examined.
Intrestingly, petitioner’s memorandum does not
attempt to demonstrate before the Court that the bank
inquiry order under Section 11 may be issued ex parte,
although the petition itself did devote some space for
that argument. The petition argues that the bank
inquiry order is "a special and peculiar remedy, drastic
in its name, and made necessary because of a public
necessity… [t]hus, by its very nature, the application
for an order or inquiry must necessarily, be ex parte."
This argument is insufficient justification in light of
the clear disinclination of Congress to allow the
issuance ex parte of bank inquiry orders under Section
11, in contrast to the legislature’s clear inclination to
allow the ex parte grant of freeze orders under Section
10.
Without doubt, a requirement that the application for a
bank inquiry order be done with notice to the account
holder will alert the latter that there is a plan to inspect
his bank account on the belief that the funds therein
are involved in an unlawful activity or money
laundering offense.80 Still, the account holder so
alerted will in fact be unable to do anything to conceal
or cleanse his bank account records of suspicious or
anomalous transactions, at least not without the whole-
hearted cooperation of the bank, which inherently has
no vested interest to aid the account holder in such
manner.
Prior to the enactment of the AMLA, the fact that bank
accounts or deposits were involved in activities later
on enumerated in Section 3 of the law did not, by itself,
remove such accounts from the shelter of absolute
confidentiality.
Prior to the AMLA, in order that bank accounts could
be examined, there was need to secure either the
written permission of the depositor or a court order
authorizing such examination, assuming that they
were involved in cases of bribery or dereliction of duty
of public officials, or in a case where the money
deposited or invested was itself the subject matter of
the litigation.
The passage of the AMLA stripped another layer off
the rule on absolute confidentiality that provided a
measure of lawful protection to the account holder. For
that reason, the application of the bank inquiry order
as a means of inquiring into records of transactions
entered into prior to the passage of the AMLA would
be constitutionally infirm, offensive as it is to the ex
post facto clause.
Still, we must note that the position submitted by Lilia
Cheng is much broader than what we are willing to
affirm. She argues that the proscription against ex post
facto laws goes as far as to prohibit any inquiry into
deposits or investments included in bank accounts
opened prior to the effectivity of the AMLA even if
the suspect transactions were entered into when the
law had already taken effect. The Court recognizes that
if this argument were to be affirmed, it would create a
horrible loophole in the AMLA that would in turn
supply the means to fearlessly engage in money
laundering in the Philippines; all that the criminal has
to do is to make sure that the money laundering
activity is facilitated through a bank account opened
prior to 2001. Lilia Cheng admits that "actual money
launderers could utilize the ex post facto provision of
the Constitution as a shield" but that the remedy lay
with Congress to amend the law. We can hardly
presume that Congress intended to enact a self-
defeating law in the first place, and the courts are
inhibited from such a construction by the cardinal rule
that "a law should be interpreted with a view to
upholding rather than destroying it."
Besides, nowhere in the legislative record cited by
Lilia Cheng does it appear that there was an
unequivocal intent to exempt from the bank inquiry
order all bank accounts opened prior to the passage of
the AMLA.
Republic v Bolante et al GR 186717 Apr 17,
2017
DOCTRINE: In the issuance of a bank inquiry order,
the power to determine the existence of probable cause
is lodged in the TC. It is necessary for the AMLC to
be able to show specific facts and circumstances that
provide a link between an unlawful activity or a money
laundering offense, on the one hand, and the account
or monetary instrument or property sought to be
examined on the other hand.
EMERGENCY RECIT:
The PNB submitted to the Anti-Money Laundering
Council (AMLC) a series of suspicious transaction
reports involving the accounts of LIVECOR, Molugan
Foundation, and AGS. The Senate furnished the
AMLC a copy of its Committee Report No. 54, which
narrated that former Undersecretary of Agriculture
Bolante requested the Department of Budget and
Management to release to the Department of
Agriculture the amount of ₱728 million for the
purchase of farm inputs and liquid fertilizers. But
based on the Audit Report prepared by the COA, the
use of the funds was characterized by massive
irregularities, overpricing, and violations. The AMLC
issued Resolution No.75 finding probable cause to
believe that the accounts of LIVECOR, Molugan and
AGS were related to what became known as the
"fertilizer fund scam. Thus, the AMLC authorized the
filing of a petition for the issuance of an order allowing
an inquiry into the six accounts of LIVECOR,
Molugan, AGS, Bombeo and Panganiban. The petition
was filed ex parte before the RTC. RTC found
probable cause and issued the order prayed for. It
allowed the AMLC to inquire into and examine the six
bank deposits or investments and the related web of
accounts. Based on the investigation, 70 accounts were
involved in the scam. The Republic filed for an
application allowing an inquiry into the total of 76
bank deposits and investments of respondents, but it
was denied by the TC. TC found no probable cause to
believe that the deposits and investments of
respondents were related to an unlawful activity. The
Republic relied merely on 2 pieces of evidence: Senate
Committee Report No. 54 and the court testimony of
witness Espina, AMLC Secretariat. The issue in this
case is WON the TC committed grave abuse of
discretion in ruling that there exists no probable cause
to allow an inquiry into the total of 76 deposits and
investments of respondents.
(see doctrine)
There was no reason to conclude that the RTC
determined the existence of probable cause, or lack
thereof, in an arbitrary and whimsical manner. The
application for the issuance of a bank inquiry order
was supported only by 2 pieces of evidence (senate
report and testimony). No grave error can be ascribed
to the RTC for rejecting and refusing to give probative
value to Senate Report. It only provided the AMLC
with the description of the alleged unlawful activity
(the fertilizer fund scam). It was in the excerpt of the
Senate Committee Report that led the AMLC to
connect the fertilizer fund scam to the suspicious
transaction reports earlier submitted to it by PNB.
However, the RTC found during trial that respondent
Bolante had ceased to be a member of the board of
trustees of LIVECOR for 14 months before the latter
even made the initial transaction, which was the
subject of the suspicious transaction reports.
Furthermore, the RTC took note that according to the
Audit Report submitted by the Commission on Audit,
no part of the P728 million fertilizer fund was ever
released to LIVECOR. We note that in the RTC Order
dated 17 November 2006 in AMLC SP Case No. 06-
003, the AMLC was already allowed ex parte to
inquire into and examine the six bank deposits or
investments and the related web of accounts of
LIVECOR, Molugan, AGS, Bombeo and Panganiban.
In fine, the RTC did not commit grave abuse of
discretion in denying the application.
while Republic v. Eugenio, Jr.( 2008), still provides
guidance in the resolution of issues relating to the
freeze and bank inquiry orders, the Decision in that
case no longer applies insofar as it requires that notice
be given to the account holders before a bank inquiry
order may be issued. Upon the enactment of R.A.
10167 on 18 June 2012, Section 11 of R.A. 9160 was
further amended to allow the AMLC to file an ex parte
application for an order allowing an inquiry into bank
deposits and investments
Estrada v SB GR 217682 Jul 17, 2018
AMLC, determining that Estrada's accounts were
probably related to the charge of plunder and the
violation of R.A. No. 3019 charged against him and
others, authorized its secretariat to file in the CA an ex
parte application for bank inquiry pursuant to R.A.
No. 9160, as amended (The Anti-Money Laundering
Act).  GRANTED
In the process of inquiring into Estrada's accounts, the
AMLC discovered that Estrada had transferred
substantial sums of money to the accounts of his wife,
co-petitioner Ma. Presentacion Vitug Ejercito
(Ejercito), on the dates relevant to the Pork Barrel
Scam. Considering that the transfers lacked apparent
legal or economic justifications, the AMLC concluded
that the accounts were linked to a predicate crime of
plunder. Hence, the AMLC filed in the CA a
supplemental ex parte application for the bank inquiry
to be conducted on Ejercito's accounts, among others
 GRANTED.
The results of the AMLC's bank inquiry into Estrada's
accounts were contained in the so-called Inquiry
Report on the Bank Transactions Related to the
Alleged Involvement of Senator Jose "Jinggoy" P.
Ejercito Estrada in the PDAF Scam (Inquiry Report).
The AMLC furnished the Office of the Ombudsman a
copy of the Inquiry Report. During Estrada's bail
hearings in the Sandiganbayan, the Prosecution
presented Atty. Orlando C. Negradas, Jr., an AMLC
financial investigator, who testified on the Inquiry
Report.9
Estrada filed the motion to suppress.  DENIED
MR  denied
ISSUE:
WON notice must first be furnished before a bank
inquiry can be had  NO, AMLA = amended already
by RA 10167.
WON an ex parte application for the bank inquiry
does not violate the proscription against ex post
facto laws  YES, it does not.
HELD:
The petitioners' reliance on Republic v. Eugenio, Jr. is
misplaced. Unlike the passage of R.A. No. 9160 in
order to allow an exception to the general rule on bank
secrecy, the amendment introduced by R.A. No.
10167 does away with the notice to the account
holder at the time when the bank inquiry order is
applied for. The elimination of the requirement of
notice, by itself, is not a removal of any lawful
protection to the account holder because the AMLC is
only exercising its investigative powers at this stage.
Indeed, R.A. No. 10167, in recognition of the ex post
facto clause of the Constitution, explicitly provides
that "the penal provisions shall not apply to acts done
prior to the effectivity of the AMLA on October 17,
2001."
Furthermore, the AMLC's inquiry and examination
into bank accounts are not undertaken whimsically
based on its investigative discretion. The AMLC and
the CA are respectively required to ascertain the
existence of probable cause before any bank inquiry
order is issued. Section 11 of R.A. 9160, even with the
allowance of an ex parte application therefor, cannot
be categorized as authorizing the issuance of a general
warrant. This is because a search warrant or warrant of
arrest contemplates a direct object but the bank inquiry
order does not involve the seizure of persons or
property.25
Lastly, the holder of a bank account subject of a bank
inquiry order issued ex parte is not without recourse.
He has the opportunity to question the issuance of the
bank inquiry order after a freeze order is issued against
the account. He can then assail not only the finding of
probable cause for the issuance of the freeze order, but
also the finding of probable cause for the issuance of
the bank inquiry order.
F. Freezing and forfeiture- Secs 10
and 12; Civil Forfeiture Rules AM 05-11-04-
SC Nov 2005;
See SC Asset Preservation Rules
Republic v First Pacific Network Inc. GR
156646 Nov 19, 2014 (Notice)
AMLC’s prayer that the freeze order be extended until
proper legal actions allowed in RA 9160 shall have
been taken against respondent cannot be
accommodated considering that both Congress and
this court have declared that a freeze order cannot be
issued or extended for an indeifinite period of time.
Ligot et al v Republic GR 176944 Mar 6,
2013
SUMMARY: The freeze order over the Ligots’
properties (which were declared by the Ombudsman to
be unexplained wealth) has been in effect since 2005,
while the civil forfeiture case – per the Republic’s
manifestation – was filed only in 2011 and the
forfeiture case under RA No. 1379 – per the
petitioners’ manifestation – was filed only in 2012.
This means that the Ligots have not been able to access
the properties subject of the freeze order for six years
or so simply on the basis of the existence of probable
cause to issue a freeze order, which was intended
mainly as an interim preemptive remedy.
DOCTRINE: The effectivity of a freeze order may be
extended by the CA for a period not exceeding six
months. Before or upon the lapse of this period,
ideally, the Republic should have already filed a case
for civil forfeiture against the property owner with the
proper courts and accordingly secure an asset
preservation order or it should have filed the necessary
information. Otherwise, the property owner should
already be able to fully enjoy his property without any
legal process affecting it.
FACTS:
1. 2005, the Republic, represented by the Anti-Money
Laundering Council (AMLC), filed an Urgent Ex-
Parte Application for the issuance of a freeze order
with the CA against certain monetary instruments and
properties of the petitioners, pursuant to Section 104
of RA 9160, (Anti-Money Laundering Act of 2001).
2. Lt. Gen. Ligot declared in his SALN that as of 2003,
he had assets in the total amount of almost 4m. In
contrast, his declared assets in his 1982 SALN
amounted to only 105k.
3. Ombudsman’s investigation revealed that Lt. Gen.
Ligot and his family had other properties and bank
accounts, not declared in his SALN, amounting to at
least 54m. These were declared to be illegally obtained
and unexplained wealth, pursuant to the provisions of
RA No. 1379 (An Act Declaring Forfeiture in Favor of
the State Any Property Found to Have Been
Unlawfully Acquired by Any Public Officer or
Employee and Providing for the Proceedings
Therefor). Furthermore, the Ombudsman concluded
that Yambao (Mrs. Ligot’s brother) acted as a dummy
and/or nominee of the Ligot spouses, and all the
properties registered in Yambao’s name actually
belong to the Ligot family. Yambao did not have a
substantial salary during his employment yet the
records show that he has real properties and vehicles
registered in his name amounting to almost 9m, which
he acquired from 1993 onwards.
4. April 2005 - Ombudsman for the Military and Other
Law Enforcement Officers issued a resolution holding
that probable cause exists that Lt. Gen. Ligot violated
Section 8, in relation to Section 11, of RA No. 6713,
as well as Article 183 (False testimony in other cases
and perjury in solemn affirmation) of the Revised
Penal Code.
7. On May 25, 2005, the AMLC issued Resolution No.
52, Series of 2005, directing the Executive Director of
the AMLC Secretariat to file an application for a freeze
order against the properties of Lt. Gen. Ligot and the
members of his family with the CA. Subsequently, on
June 27, 2005, the Republic filed an Urgent Ex-Parte
Application with the appellate court for the issuance of
a Freeze Order against the properties of the Ligots and
Yambao.
8. July 2005- CA ruled that probable cause existed that
an unlawful activity and/or money laundering offense
had been committed by Lt. Gen. Ligot and his family,
including Yambao, and that the properties sought to be
frozen are related to the unlawful activity or money
laundering offense. Accordingly, the CA issued a
freeze order against the Ligots’ and Yambao’s various
bank accounts, web accounts and vehicles, valid for a
period of 20 days from the date of issuance.
9. September 2005 – CA extended the freeze order
over the Ligots’ various bank accounts and personal
properties "until after all the appropriate proceedings
and/or investigations being conducted are terminated."
10. The Ligots have not been able to access the
properties subject of the freeze order for six years or
so simply on the basis of the existence of probable
cause to issue a freeze order, which was intended
mainly as an interim preemptive remedy.
ISSUE (related to the subject matter):
Whether or not a freeze order may be issued for an
indefinite period
RULING:
The Court fixed the maximum allowable extension on
the freeze order’s effectivity at six months. In doing
so, the Court sought to balance the State’s interest in
going after suspected money launderers with an
individual’s constitutionally-protected right not to be
deprived of his property without due process of law, as
well as to be presumed innocent until proven guilty.
We GRANT the petition and LIFT the freeze order
issued by the Court of Appeals in CA G.R. SP No.
90238. This lifting is without prejudice to, and shall
not affect, the preservation orders that the lower courts
have ordered on the same properties in the cases
pending before them. Pursuant to Section 56 of A.M.
No. 05-11-04-SC, the Court of Appeals is hereby
ordered to remand the case and to transmit the records
to the Regional Trial Court of Manila, Branch 22,
where the civil forfeiture proceeding is pending, for
consolidation therewith as may be appropriate.
RATIO:
1. Nothing in the law grants the owner of the "frozen"
property any substantive right to demand that the
freeze order be lifted, except by implication, i.e., if he
can show that no probable cause exists or if the 20-day
period has already lapsed without any extension being
requested from and granted by the CA. Notably, the
Senate deliberations on RA No. 9160 even suggest the
intent on the part of our legislators to make the freeze
order effective until the termination of the case, when
necessary.
2. The silence of the law, does not in any way affect
the Court’s own power under the Constitution to
"promulgate rules concerning the protection and
enforcement of constitutional rights xxx and procedure
in all courts."
 Court created A.M. No. 05-11-04-
SC which limits the effectivity of an
extended freeze order to six months
– to otherwise leave the grant of the
extension to the sole discretion of
the CA, which may extend a freeze
order indefinitely or to an
unreasonable amount of time –
carries serious implications on an
individual’s substantive right to due
process.
 This right demands that no person
be denied his right to property or be
subjected to any governmental
action that amounts to a denial. The
right to due process, under these
terms, requires a limitation or at
least an inquiry on whether
sufficient justification for the
governmental action.
3. As a rule, the effectivity of a freeze order may be
extended by the CA for a period not exceeding six
months. Before or upon the lapse of this period,
ideally, the Republic should have already filed a case
for civil forfeiture against the property owner with the
proper courts and accordingly secure an asset
preservation order or it should have filed the necessary
information. Otherwise, the property owner should
already be able to fully enjoy his property without any
legal process affecting it. However, should it become
completely necessary for the Republic to further
extend the duration of the freeze order, it should file
the necessary motion before the expiration of the six-
month period and explain the reason or reasons for its
failure to file an appropriate case and justify the period
of extension sought. The freeze order should remain
effective prior to the resolution by the CA, which is
hereby directed to resolve this kind of motion for
extension with reasonable dispatch.
Republic v Manalo et al GR 192303 Jun 4,
2014
Republic, represented in this case by the Anti–Money
Laundering Council (AMLC), filed a complaint for
civil forfeiture, entitled “Republic v. R.A.B. Realty,
Inc., et al.,” before the Manila RTC. Subsequently, it
filed a second complaint for civil forfeiture, entitled
“Republic v. Ariola, Jr., et al.,” also before the same
RTC.
In the said civil forfeiture cases, the Republic sought
the forfeiture in its favor of certain deposits and
government securities maintained in several bank
accounts by the defendants therein, which were related
to the unlawful activity of fraudulently accepting
investments from the public, in violation of the SEC
and AMLA.
Respondents filed separate Motions for Leave to
Intervene and Admit Attached Answer–in
Intervention, in the civil forfeiture cases, respectively,
alleging, inter alia, that they have a valid interest in
the bank accounts subject thereof.
In this relation, they asserted that in a separate petition
for involuntary insolvency proceedings filed before
the RTC of Makati City, they were appointed as
assignees of the properties of Spouses Saturnino and
Rosario Baladjay (Sps. Baladjay) (as well as their
conduit companies) who were impleaded as
defendants in the aforementioned civil forfeiture
cases.
ISSUE:
WON CA erred when it denied respondents’ separate
motions for intervention in the civil forfeiture cases
At this point, the Court duly notes that during the
pendency of the instant petition, the Manila RTC
rendered a Decision which ordered the assets subject
of the said cases forfeited in favor of the government.
In view thereof, the Republic prayed that it be excused
from filing the required reply, which the Court granted
in a Resolution.
HELD: MOOT NA DAW! (yan lang yung ruling
talaga!)
In this case, the Manila RTC’s rendition of the
Decision dated September 23, 2010 in Civil Case No.
03–107325, as well as the Decision dated February 11,
2011 and the Amended Decision dated May 9, 2011 in
Civil Case No. 03–107308, by virtue of which the
assets subject of the said cases were all forfeited in
favor of the government, are supervening
events which have effectively rendered the essential
issue in this case moot and academic, that is, whether
or not respondents should have been allowed by the
Manila RTC to intervene on the ground that they. have
a legal interest in the forfeited assets. As the
proceedings in the civil forfeiture cases from which the
issue of intervention is merely an incident have already
been duly concluded, no substantial relief can be
granted to the Republic by resolving the instant
petition.
Republic v Glasgow Credit and Collection
Services 542 SCRA 95 (2008)
Doctrine: In applying for civil forfeiture, petitioner
must allege the act prohibited under AMLA.
Issue: Whether the complaint for civil forfeiture was
correctly dismissed on grounds of improper venue,
insufficiency in form and substance and failure to
prosecute.
Facts:
1. On July 18, 2003, the Republic filed a complaint
in the RTC Manila for civil forfeiture of
assets with TRO with a writ of injunction against
the bank deposits in account number CA-005-10-
000121-5 maintained by Glasgow in CSBI
pursuant to RA 9160 or the Anti-Money
Laundering Act of 2001.
2. RTC of Manila granted the TRO and then the writ
of injunction. Summons to Glasgow was unserved
as it could no longer be found at its last known
address. RP requested to alias summons and
publication. But, only alias summons was
directed.
3. After 4 months, RTC achieved the case for failure
to serve the alias summons. RP filed a motion to
reinstates the case and resolve the motion to serve
summons by publication. RTC only directed RP
to issue alias summons
4. RP received a copy of the sheriffs return stating
that the alias summons was returned unserved as
Glasgow was no longer holding office at the given
address since July 2002 and left no forwarding
address. RP continued to manifest to RTC to
resolve motion to serve summons by publication.
5. OSG for the RP received a copy of Glasgows
Motion to Dismiss (by way of special appearance)
alleging that the court had no jurisdiction over its
person because summons has yet to be served;
complaint has no cause of action; and RP failed to
prosecute.
6. RP opposed the MTD contending that the suit was
quasi in rem and acquiring jurisdiction was not a
prerequisite
7. RTC dismissed the case
Held: NO.
1. Complaint was filed at the proper venue. Glasgow
never questions the validity of the venue. RTC
should not have ruled upon its propriety. RTC was
the proper venue and the order has yet attained
finality.
2. Complaint was sufficient in form and substance.
The complaint for civil forfeiture of assets filed by
AMLC alleged that the account owned by
Glasgow under CSBI has been subject of
Suspicious Transaction Reports. SC finds thats
the decision of the RTC is incorrect, because the
focus in determining the presence of cause of
action is the sufficiency of the material allegations
and not the veracity.
The SC notes that the contents of the petition
for civil forfeiture are, among others, acts or
commissions prohibited by AMLA. This was
complied by the RP. RA 9160, as amended, and its
implementing rules and regulations lay down two
conditions when applying for civil forfeiture: (1) when
there is a suspicious transaction report or a covered
transaction report deemed suspicious after
investigation by the AMLC and; (2) the court has, in
a petition filed for the purpose, ordered the seizure of
any monetary instrument or property, in whole or in
part, directly or indirectly, related to said report.
3. The is no failure to prosecute because Glasgow’s
whereabouts could not be ascertained was not
only beyond the Republics control, it was also
attributable to Glasgow which left its principal
office address without informing the Securities
and Exchange Commission or any official
regulatory body (like the Bureau of Internal
Revenue or the Department of Trade and
Industry) of its new address. In ascertaining delay
to prosecute, there must be a wanton failure to
observe the mandatory requirement of the rules on
the part of the plaintiff, The SC sees no partner or
scheme on the part of the RP to delay the
disposition.