REPUBLIC OF THE PHILIPPINES, represented by the ANTI-MONEY LAUNDERING COUNCIL vs. JOCELYN I. BOLANTE

REPUBLIC OF THE PHILIPPINES, represented by the ANTI-MONEY LAUNDERING COUNCIL vs. JOCELYN I. BOLANTE, OWEN VINCENT D. BOLANTE, MA. CAROL D. BOLANTE, ALEJO LAMERA, CARMEN LAMERA, EDNA CONSTANTINO, ARIEL C. PANGANIBAN, KATHERINE G. BOMBEO, SAMUEL S. BOMBEO, MOLUGAN FOUNDATION, SAMUEL G. BOMBEO, JR., and NATIONAL LIVELIHOOD DEVELOPMENT CORPORATION (Formerly Livelihood Corporation),

x - - - - - - - - - - - - - - - - - - - - - - - - - -x

G.R. No. 190357

REPUBLIC OF THE PHILIPPINES, represented by the ANTI-MONEY LAUNDERING COUNCIL vs. HON. WINLOVE M. DUMAYAS, Presiding Judge of Branch 59, Regional Trial Court in Makati City, JOCELYN I. BOLANTE, ARIEL C. PANGANIBAN, DONNIE RAY G. PANGANIBAN, EARL WALTER G. PANGANIBAN, DARRYL G. PANGANIBAN, GAVINA G. PANGANIBAN, JAYPEE G. PANGANIBAN, SAMUEL S. BOMBEO, KATHERINE G. BOMBEO, SAMUEL G. BOMBEO, JR., NATIONAL LIVELIHOOD DEVELOPMENT CORPORATION (FORMERLY LIVELIHOOD CORPORATION), MOLUGAN FOUNDATION, ASSEMBLY OF GRACIOUS SAMARITANS FOUNDATION, INC., ONE ACCORD CHRISTIAN COMMUNITY ENDEAVOR FOR SALVATION & SUCCESS THROUGH POVERTY ALLEVIATION, INC., SOCIETY'S MULTI-PURPOSE FOUNDATION, INC., ALLIANCE FOR THE CONSERVATION OF ENVIRONMENT OF PANGASINAN, INC., AND STA. LUCIA EDUCATIONAL ASSOCIATION OF BULACAN, INC.

G.R. No. 186717        April 17, 2017

 

SERENO, C.J.

 

FACTS:

The Philippine National Bank submitted to the Anti-Money Laundering Council a series of suspicious transaction reports involving the accounts of Livelihood Corporation, Molugan Foundation, and Assembly of Gracious Samaritans, Inc. The transactions were reported '"suspicious" because they had no underlying legal or trade obligation, purpose or economic justification; nor were they commensurate to the business or financial capacity of Molugan and AGS, which were both lowly capitalized at P50,000 each. On 7 March 2006, the Senate furnished the AMLC a copy of its Committee Report No. 54 narrating that former Undersecretary of Agriculture Jocelyn I. Bolante requested the Department of Budget and Management to release to the Department of Agriculture the amount of P728 million for the purchase of farm inputs under the Ginintuang Masaganang Ani Program. This amount was used to purchase liquid fertilizers from Freshan Philippines, Inc. and based on the Audit Report prepared by the Commission on Audit, the use of the funds was characterized by massive irregularities, overpricing, violations of the procurement law and wanton wastage of scarce government resources.

 

The AMLC issued Resolution No. 75 finding probable cause to believe that the accounts of LIVECOR, Molugan and AGS - the subjects of the suspicious transaction reports submitted by PNB - 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, Samuel S. Bombeo and Ariel Panganiban. The petition was filed ex parte before the RTC and 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. Meanwhile, based on the investigation of the Compliance and Investigation Group of the AMLC Secretariat, a total of 70 bank accounts or investments were found to be part of the related web of accounts involved in the fertilizer fund scam. Accordingly, the AMLC issued Resolution No. 90 finding probable cause to believe that these 70 accounts were related to the fertilizer fund scam. The AMLC therefore authorized the filing of a petition for the issuance of an order allowing an inquiry into these 70 accounts.

 

The RTC found no probable cause to believe that the deposits and investments of respondents were related to an unlawful activity. It pointed out that the Republic, in support of the latter's application, relied merely on two pieces of evidence: Senate Committee Report No. 54 and the court testimony of witness Thelma Espina of the AMLC Secretariat. According to the RTC, Senate Committee Report No. 54 cannot be taken "hook, line and sinker," because the Senate only conducts inquiries in aid of legislation. Citing Neri v. Senate Committee on Accountability of Public Officers and Investigations, the trial court pronounced that the Senate cannot assume the power reposed in prosecutorial bodies and the courts - the power to determine who are liable for a crime or an illegal activity. The latter "admitted that the AMLC did not bother to confirm the veracity of the statements contained therein."

 

ISSUE:

Whether there exists no probable cause to allow an inquiry into the total 76 deposits and investments of respondents.

 

RULING:

Yes. For the trial court to issue a bank inquiry order, 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. In this case, the RTC found the evidence presented by the AMLC wanting. For its part, the latter insists that the RTC's determination was tainted with grave abuse of discretion for ignoring the glaring existence of probable cause that the subject bank deposits and investments were related to an unlawful activity.

 

We find no reason to conclude that the RTC determined the existence of probable cause, or lack thereof, in an arbitrary and whimsical manner. To repeat, the application for the issuance of a bank inquiry order was supported by only two pieces of evidence: Senate Committee Report No. 54 and the testimony of witness Thelma Espina. We have had occasion to rule that reports of the Senate stand on the same level as other pieces of evidence submitted by the parties, and that the facts and arguments presented therein should undergo the same level of judicial scrutiny and analysis. As courts have the discretion to accept or reject them, no grave error can be ascribed to the RTC for rejecting and refusing to give probative value to Senate Committee Report No. 54. At any rate, Senate Committee Report No. 54 only provided the AMLC with a description of the alleged unlawful activity, which is the fertilizer fund scam. It also named the alleged mastermind of the scam, who was respondent Bolante.