Bank Secrecy Law

1. Under Republic Act No.1405, what is the nature of bank deposit and investment in
government bonds?

As a general rule, they are absolutely confidential in nature.

As a general rule, they are generally subject to any type of inspection.

They are exempted from any type of inquiry.

None of the above.

2. Which of the following is not an exception to the secrecy of bank deposits?

Upon order of the CA, examination of law enforcement officers in terrorism cases.

Impeachment cases of the President.

Crime of theft where it is unknown where the funds were deposited.

Upon the order of a competent course in case of bribery or dereliction of duty of

public officials.

3. Deposits accounts in Bank Secrecy Law are in the form of?

- Savings Account, Current Account, Time Deposits

4. They refer to money or funds placed with a bank that can be withdrawn on the
depositor's order or demand.

Deposits

Trust funds

Money Market Placements

Deposit Substitutes

5. The purpose/s of R.A No.1405 is/are to

 Give encouragement to the people to deposit their money in banking institutions.

Discourage private hoarding so that the same may be properly utilized by banks in
authorized loans to assist in the economic development of the country.

All of the above.

None of the above.

6. The Bangko Sentral can examine bank accounts in the course of its periodic 1 point or
special examination regarding compliance with Anti-Money Laundering Law.

True

False

7. Which of the following inquiries will be considered a violation of Peso Deposit Secrecy
Law?

Periodic inquiry or special examination of bank deposits by BSP to ensure compliance

with the Anti-Money Laundering Law.

Inquiry or bank deposits by BIR Commissioner in relation to an application for

compromise of taxable liability or determination of a decedent's gross estate under National
Internal Revenue Code.

Inquiry of bank deposits by PDIC when there is finding of unsafe or unsound banking
practices.

Inquiry of bank deposits by DOJ Secretary for the purpose of persecution of the
members of the opposing political party.

8. As a general rule, which type of bank deposit may not be subject to attachment,
execution or garnishment?

Philippine Peso Bank Deposit

Foreign Currency Bank Deposit

Both A and B

Neither A and B
9. The following are the exceptional cases when the BIR Commissioner may inspect bank
deposits, except

When there is application of compromise liability by a taxpayer on the ground of

financial incapacity

To determine the gross estate for computation of estate tax's liability

When a request for tax information of specific taxpayers made by a foreign tax
authority pursuant to a tax treaty under The Exchange of Information on Tax Matters Act of
2009

To determine the taxable income of politicians

10. The following instruments are considered absolutely confidential in nature, except

Time Deposit

Savings Deposit

Current Account

Money Market Placements

11. What is the penalty provided by law for violation of RA 1405 a.k.a Philippine Peso
Deposit Secrecy Law?

Imprisonment of not more than five years or fine of not more than P20,000 or both
imprisonment and fine.

Imprisonment of not more than ten years or fine of not more than P200,000 or both
imprisonment and fine.

Imprisonment of not more than twenty years or fine of not more than P2,000,000 or
both imprisonment and fine.

Imprisonment of not more than one year or fine of not more than P2,000 or both
imprisonment and fine.

12. If the Ombudsman is convinced that there is a violation of law afterinvestigating a

complaint alleging illicit bank deposits of a public officer, the Ombudsman may order the
bank concerned to allow in camera inspection of bank records and documents.

True

False
13. Investments in Corporate Bonds are debt securities which are unconditional obligations
of the State, and backed by its full taxing power. It includes treasury bills, treasury notes,
retail treasury bonds, dollar linked peso notes, and other risk-free bonds.

True

False

14. What is the penalty for violating Bank Secrecy Law under foreign currency deposits?

Imprisonment: 1-5 years Fine: Not to exceed P20,000

Imprisonment: Not to exceed 5 years Fine: Not to exceed P20,000

Imprisonment: Not to exceed 5 years Fine: P5,000 - P25,000

Imprisonment: 1-5 years Fine: P5,000 - P25,000

15. Mr. X is an auditor of ABC company and it is his first year of experience as an
auditor. While auditing the financial statements of the company, he noticed the
large amount in the account “Cash in Bank” and he was so surprised about it that
he cannot forget it. After his work, he had a drink with his friends and disclosed the
amount of deposits that ABC company has. His friends are not professionals and
cannot cause any harm with the information obtained. Did Mr. X violate the Bank
Secrecy Law?

Yes

No

Maybe

Both B and C

16. Which is not an exception to the Bank Secrecy Law?

Written permission of the depositor

Letter of threat by a creditor

By order of a competent court

When an official is under an impeachment case

17. The Bank Secrecy Law (RA 1405) prohibits disclosing any information about deposit
records of an individual without court order except:

In an investigation by the Ombudsman

In an investigation for violation of Anti-Graft and Corrupt Practices

In an examination to determine gross estate of a decedent

In an impeachment proceeding

18. X, a private individual, maintains a dollar deposit with ABC Bank, X is suspected to be the
leader of a Kidnap for Ransom Gang and he is suspected of depositing all ransom money
in said deposit account which are all in US Dollars. The police want to open said account
to know if there are really deposits in big amounts. Which statement is most accurate?

An approval from the Monetary Board is necessary to open the account

The same rules under Secrecy of Bank Deposit Act will apply

Because the deposit is in US Dollars, it is covered by the Foreign Currency Deposit

Act which allows disclosures only upon the written permission of the depositor

Approval from the Court is necessary to order disclosure of the account.

19. Statement I: A co-payee in a check deposited in a bank is likewise a co- depositor thereof;
no written consent of other co-payee is necessitated in an inquiry of the deposits by the
said co-depositor. Statement II: Money market placement is not covered by RA 1405
because it is not deposited in a bank.

Both statements are true

Both statements are false

Statement I is true, Statement II is false

Statement I is false, Statement II is true.

20. Give at least three (3) examples of government bonds.

- Treasury Bills, Treasury Notes, Retail Treasury Bonds, Dollar Linked Peso Notes
21. Which of the following is an exception to the secrecy of bank deposits which are in
Philippine Peso, but NOT an exception to the secrecy of foreign currency deposits?

Upon Bangko Sentral ng Pilipinas (BSP) inquiry into or examination of deposits or

Investments with any bank, when the inquiry or examination is made in the course of the
BSP's periodic special examination of said bank to ensure compliance with the AMLA

Upon PDIC and BSP inquiry into and examination of deposit accounts in case there is
a finding of unsafe or unsound banking practice

Upon inquiry by the Commissioner of Internal Revenue in the event a taxpayer has an
application to compromise his tax liabilities on the ground of financial incapacity

Upon inquiry in cases of impeachment