The money-laundering case of the government against some personalities involved in the controversial Ninoy Aquino International Airport Terminal 3 is getting an extra push from Congress—but not from the Supreme Court.

The campaign against money laundering suffered a setback following an SC ruling last February upholding the primacy of privacy and secrecy of bank deposits. The SC also tightened the rules in the implementation of the Anti-Money Laundering Act (AMLA) vis-à-vis bank secrecy rules.

The SC decision has put a dent on efforts by the Anti-Money Laundering Council (ALMC) to go after suspicious bank transactions, and has raised fears that the country could face serious repercussions in its financial transactions with other countries as a result.

The ruling has come at a precarious time. In Sept. to Oct. this year, the Philippines will be evaluated by the Asia/Pacific Group (APG) on Money Laundering to assess the country’s compliance in enforcing laws and regulations against dirty and terrorism-tainted money.

The Office of the Solicitor-General has filed a motion for reconsideration, arguing that it runs counter to the standards set by the Financial Action Task Force (FATF), which among others, includes the ability to identify and trace property subject to a money-laundering inquiry.

The FATF, which was established by the Group of Seven Nations and has more than 30 member-jurisdictions, could individually impose drastic counter measures to the Philippines if it falls short of the standards.

Enter Angara

Abs-cbnNews.com/Newsbreak, however, has learned that the congressional oversight committee monitoring the implementation of AMLA, in a bid to reverse the ruling and avoid FATF sanctions, is seeking to intervene in the case.

Senator Edgardo Angara, who chairs the oversight committee, confirmed that they will seek permission with the SC to file an amicus curiae brief to bolster the government’s position. Amicus curiae basically means ‘friend of the Court.’

"It will be in support of AMLA and AMLC. The SC ruling will render AMLA inutile," Angara said. "We will state our position on the case."

Angara said the SC ruling, which requires a court notice and hearing before any bank inquiry is initiated, "would alert holders of suspicious accounts to close his or her accounts."

To prevent such from happening, an AMLC official, who refused to be named for lack of authority, said the council could resort to freeze orders in the meantime. But then, it is a temporary relief, as a freeze order is only effective for six months.

The AMLC official said the SC has denied the council an "investigative tool to go after money-launderers."

Rep. Rodolfo Plaza, a member of the oversight committee, agreed with the OSG that the SC ruling has clipped the powers of AMLC and could inhibit the AMLC’s campaign against laundered money.

Angara and Plaza told abs-cbnNews.com/Newsbreak that they "hope to enlighten" the SC as to the intent of the lawmakers when they passed the AMLA

Alvarez, Cheng

The case was prompted by the Ombudsman’s investigation in the graft-riddled NAIA 3 project after the SC declared the concession agreement awarded to the Philippine International Airport Corporation over the NAIA 3 null and void.

To trace the money trail, the OSG sought AMLC’s assistance to pry open the accounts of certain individuals involved in the project. They included former Transportation Secretary Pantaleon Alvarez, who chaired the Pre-bidding and Awards Committee of the NAIA 3, and Cheng Yong, president of PIATCO. The OSG also sought to pry open the accounts of Alfredo Liongson and Wilfredo Trinidad.

The AMLC issued a resolution authorizing the AMLC executive director to inquire into the Web accounts of the Piatco officials and initial search established that amounts were transferred from Hongkong bank account owned by Jetstream Pacific Ltd. to the bank accounts maintained by Liongson and Yong.

As for Alvarez, Special Prosecutor Dennis Villa-Ignacio informed the AMLC there is "probable cause" to believe that his bank accounts "were used in the commission of illegal activities."

On Dec. 2005, the AMLC filed an ex-parte bank inquiry application before the Manila Regional Trial Court to examine 13 accounts and two related accounts that included the DBS account of Alvarez and Metrobank accounts of Yong. An ex-parte application does not require hearing and notice to the parties involved

The RTC granted the ex-parte application but Alvarez questioned the ruling on the ground that it violated his rights. He also argued that there was nothing in the AMLA granting AMLC ex-parte inquiry.

Meanwhile, Yong’s wife, Lilia Cheng, sought an injunction before the Court of Appeals to prevent the Manila and Makati RTC from allowing the AMLC from executing any bank inquiries into their Metrobank and Citibank accounts. Cheng argued that the accounts were conjugal accounts and the ex-parte inquiry denied her due process.

In separate orders in July and August 2005, the Manila RTC granted Alvarez’s petition, prompting the AMLC to elevate its case before the SC.

Tinga’s decision

In its ruling, the SC said the law does not allow courts to issue ex-parte bank inquiries as the law differentiates between a freeze order and a bank inquiry.

The Court pointed out Section 10 of AMLA (which provides for freeze orders) that used specific language for ex-parte application, which is absent in Section 12 (which covers bank inquiries).

The ruling, issued by the Court’s 2nd division and penned by Justice Dante Tinga, stressed that while AMLA may have added exceptions to the Bank Secrecy Act, "yet the secrecy of bank deposits still lies as the general rule. It falls within the zones of privacy recognized by our laws."

The Court said any exception to this rule must be specifically legislated, noting that the Bank Secrecy Act itself and other laws prescribe exceptions. AMLA itself has proscribed exceptions to the secrecy of bank deposits, allowing the AMLC to inquire into accounts without a court order.

But in this case, the Court said a bank inquiry does not fall within the exceptions as enumerated in AMLA. "If there are doubts in upholding the absolutely confidential nature of bank deposits against affirming the authority to inquire into such accounts, then such doubts must be resolved in favor of the former."

The Court’s ruling was a double setback for the AMLC as it also has the effect of sustaining the petition filed by Lilia Cheng before the CA. (abs-cbnNEWS.com/Newsbreak)

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