ANTI-MONEY

LAUNDERING ACT
REPUBLIC OF THE PHILIPPINES v. JOCELYN BOLANTE ET AL
G.R. NO. 196717, April 17, 2017
Sereno, J:

DOCTRINE:

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.

FACTS:

PNB reported to AMLC series of suspicious transactions involving the accounts of Livelihood
Corporation, Molugan Foundation, and Assembly of Gracious Samaritans. Livecor transferred to
Molugan a total of P172.6 Million in a span of 15 months, and P40 Million to AGS on April 30, 2004.
AGS received P38 Million from Molugan on the same day, but returned the same on the same day. 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. Senate Committee Report No. 54 stated
that Undersecretary of Agriculture Bolante requested DBM to release to DA P728 Million for purchase of
farm inputs. Bolante was also appointed as acting Chairman of Livecor. AMLC issued Resolution No. 75
finding probable cause that the suspicious transactions were the “fertilizer fund scam.”

ISSUE:

Whether or not the RTC 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.

HELD:

No. In this case, the RTC found the evidence presented by the AMLC wanting. 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. The report only provided the AMLC with a
description of the alleged unlawful activity, which is the fertilizer fund scam, and also named the alleged
mastermind of the scam, who was respondent Bolante. The entire case of the AMLC, however, hinged on
the excerpt of said report that at the time that he was Undersecretary, Bolante was concurrently appointed
by the President in other powerful positions: as Acting Chairman of the Livecor. 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 P728M fertilizer fund was ever released to Livecor.
JACINTO LIGOT v. REPUBLIC OF THE PHILIPPINES
G.R. NO. 176944, March 6, 2013
Brion, J:

DOCTRINE:

A freeze order is an extraordinary and interim relief issued by the CA to prevent the dissipation, removal,
or disposal of properties that are suspected to be the proceeds of, or related to, unlawful activities as
defined in Section 3(i) of RA No. 9160, as amended. The primary objective of a freeze order is to
temporarily preserve monetary instruments or property that are in any way related to an unlawful activity
or money laundering, by preventing the owner from utilizing them during the duration of the freeze order.
The relief is pre-emptive in character, meant to prevent the owner from disposing his property and
thwarting the State’s effort in building its case and eventually filing civil forfeiture proceedings and/or
prosecuting the owner.

FACTS:

Republic filed an Urgent Ex-Parte Application for issuance of freeze order with the CA against certain
monetary instruments and properties of the Petitioners pursuant to Section 10 of RA 9160, as amended.
This was based on the letter of the Ombudsman to AMLC recommending to conduct investigation on
Ligot and his family for possible violation of RA 9160 because of their declared and undeclared assets in
comparison with his main source of income being an officer of the AFP. The Ombudsman declared the
assets registered under his name, and those of his wife and children, as illegally obtained and unexplained
wealth. A freeze order was issued, and a motion for extension of such was filed. The CA resolved to
extend said order until after all the appropriate proceedings and/or investigations have been terminated.

ISSUES:

1. Whether or Not the freeze order deprived them of their property and due process since it was issued
even before the guilt was proven

2. Whether or Not certiorari will lie against freeze order

HELD:

1. No. The legal basis for the issuance of a freeze order is Section 10 of RA No. 9160, as amended by RA
No. 9194, which states the Court of Appeals, upon application ex parte by the AMLC and after
determination that probable cause exists that any monetary instrument or property is in any way related to
an unlawful activity, may issue a freeze order which shall be effective immediately. The freeze order shall
be for a period of twenty (20) days unless extended by the court. As defined in the law, the probable
cause required for the issuance of a freeze order refers to such facts and circumstances which would lead
a reasonably discreet, prudent or cautious man to believe that an unlawful activity and/or a money
laundering offense is about to be, is being or has been committed and that the account or any monetary
instrument or property subject thereof sought to be frozen is in any way related to said unlawful activity
and/or money laundering offense. Since these assets are grossly disproportionate to Ligot’s income, as
well as the lack of any evidence that the Ligots have other sources of income, the CA properly found that
probable cause exists that these funds have been illegally acquired.
2. No. The proper remedy is not Petition for Certiorari, but rather Petition for Review on Certiorari for
the former has a narrow scope. This should have been filed within 15 days from the receipt of the CA’s
resolution denying the motion to lift the extended freeze order.
SUBIDO PAGENTE CERTEZA MENDOZA v. THE COURT OF APPEALS
G.R. NO. 216914, December 6, 2016
Perez, J:

DOCTRINE:

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. Also, 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 procedural due process

FACTS:

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. The Ombudsman and the Senate
conducted investigations and inquiries, and from various news reports announcing the inquiry into then
Vice President Binay's bank accounts, petitioner SPCMB wrote to the Presiding Justice of the CA,
requesting to secure copies of the relevant documents of the case, such as the petition and orders issued.
Presiding Justice Reyes denied SPCMB’s request and the CA subsequently issued a Resolution granting
the ex-parte application of the AMLC to examine the bank accounts of SPCMB. SPCMB then contented
that the AMLA is unconstitutional insofar as it allows the examination of a bank account without any
notice to the affected party, hence it violates the person’s right to due process and right to privacy.

ISSUE:

Whether or not SPCMB’s contentions are correct

HELD:

No. Section 11 of the AMLA originally did not specify for an ex-parte application by the AMLC for
authority to inquire into or examine certain bank accounts or investments, the extent of this authority was
the topic of the Eugenio case where it was quite apparent from said case that absent a specific wording in
the AMLA allowing for ex-parte proceedings in orders authorizing inquiry and examination by the
AMLC into certain bank deposits or investments, notice to the affected party is required. Heeding the
Court's observance in Eugenio that the remedy of the Republic then lay with the legislative, Congress
enacted RA No. 10167 amending Section 11 of the AMLA and specifically inserted the word ex-parte
appositive of the nature of this provisional remedy available to the AMLC thereunder. At the stage in
which the petition was filed before the Court, the inquiry into certain bank deposits by the AMLC does
not contemplate any form of physical seizure of the targeted corporeal property, hence not violative of
substantive due process. Moreover, the AMLC does not exercise quasi-judicial powers and is simply an
investigatory body, hence SPCMB's constitutional right to procedural due process was not violated. As to
the constitutional right to privacy, the general rule of absolute confidentiality is simply statutory, i.e. not
specified in the Constitution, which has been affirmed in jurisprudence; Exceptions to the general rule of
absolute confidentiality have been carved out by the Legislature which legislation have been sustained,
albeit subjected to heightened scrutiny by the courts; and one such legislated exception is Section 11 of
the AMLA.

JOSE EJERCITO ESTRADA v. SANDIGANBAYAN

G.R. NO. 217682, July 17, 2018
Bersamin, J:

DOCTRINE:

AMLC, in investigating probable money laundering activities, does not exercise quasi-judicial powers,
but merely acts as an investigatory body with the sole power of investigation.

FACTS:

Benhur et al (whistleblowers) executed their Pinagsamang Sinumpaang Salaysay which revealed the
details of the Pork Barrel Scam involving misuse or illegal diversion by certain legislators of their
allocated PDAF in connivance with Napoles. NBI conducted its investigation and filed in the
Ombudsman a verified complaint for plunder, malversation, direct bribery, and graft and corrupt practices
act against those who are involved, including Estrada. Ombudsman requested AMLC to conduct financial
investigation on the bank accounts of Estrada. AMLC filed in the CA an ex parte application for bank
inquiry pursuant to AMLA, which was granted. AMLC discovered that Estrada had transferred
substantial sums of money to the accounts of his wife on dates relevant to the Scam. 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 Estrada.

ISSUE:

Whether or Not Section 11 of TA 9160, as amended, violates the right to due process and right to privacy

HELD:

No. AMLC, in investigating probable money laundering activities, does not exercise quasi-judicial
powers, but merely acts as an investigatory body with the sole power of investigation similar to the
functions of the National Bureau of Investigation (NBI). Hence, the ex parte application for the bank
inquiry order cannot be said to violate any person's constitutional right to procedural due process. Hence,
the ex parte application for the bank inquiry order cannot be said to violate any person's constitutional
right to procedural due process. 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. 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. 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.
REPUBLIC OF THE PHILIPPINES v. HON. ANTONIO M. EUGENIO
G.R. NO. 174629, February 14, 2008
Tinga, J:

FACTS:

The Compliance and Investigation Staff (CIS) of petitioner AMLC conducted an intelligence database
search on the financial transactions of certain individuals involved in the award of the NAIA 3 contracts
to PIATCO, including respondent Pantaleon Alvarez who had been the Chairman of the PBAC Technical
Committee, NAIA-IPT3 Project. The search revealed that Alvarez maintained 8 bank accounts with 6
different banks, and the Makati RTC thereafter granted the AMLC the authority to inquire and examine
the subject bank accounts of Alvarez, among others. The AMLC also promulgated a Resolution, pursuant
to a letter of the Special Prosecutor, which authorized the executive director of the AMLC to inquire into
and examine the accounts named in the letter, including one maintained by Alvarez with DBS Bank and
two other accounts in the name of Cheng Yong with Metrobank. The Republic then filed an application
before the Manila RTC to inquire into and/or examine 13 accounts and 2 related web of accounts alleged
as having been used to facilitate corruption in the NAIA 3 Project. The Manila RTC issued an Order
granting the Ex Parte Application.

ISSUE:

Whether or not an application for an order authorizing inquiry into or examination of bank accounts or
investments under Section 11 of the AMLA ex-parte in nature

HELD:

N o. 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, certain violations of the Comprehensive Dangerous Drugs Act of 2002, hijacking
and other violations under R.A. No. 6235, destructive arson and murder, however, these special
circumstances do not apply in this case. 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. Section 10 uses specific language to authorize an ex parte
application for the provisional relief therein, a circumstance absent in Section 11. If indeed the legislature
had intended to authorize ex parte proceedings for the issuance of the bank inquiry order, then it could
have easily expressed such intent in the law, as it did with the freeze order under Section 10.
REPUBLIC OF THE PHILIPPINES v. BLOOMBERRY RESORTS AND HOTELS
G.R. NO. 224112, September 2, 2020
Carandang, J:

FACTS:

Bangladesh Bank was hacked and its Governor (Rahman) sought assistance from BSP Governor
regarding the loss of millions of US dollars. According to Governor Rahman, some fraudulent payment
transactions were made to the New York Fed in favor of RCBC involving US$81,000,000.00. Several
bank transfers were also discovered in favor of Philippine Banks. Part of the huge remittances was
credited to PhilRem’s account. PhilRem was informed by Go that he intended to take advantage of the
influx of Chinese casino players for the Chinese New Year. Hence, upon Go's instructions, PhilRem
delivered: (1) US$29,000,000.00 to Bloomberry Resorts and Hotels among others. Upon finding of
probable cause that BRHI's BDO Account was related to the unlawful activity of hacking, the AMLC
issued a resolution authorizing the AMLC Secretariat to file, through the OSG, an ex parte petition for the
issuance of a freeze order against the subject account.  AMLC also filed an application for bank inquiry
with the CA which was granted. Bloomberry asserts that being a casino operator, it is not a covered
institution under AMLA. The CA later on lifted the freeze order earlier issued against BRHI.

ISSUE:

Whether or Not re-freezing of the account is possible after the lapse of a period more than 6 months

HELD:

No. Re-freezing the account is not possible for it would put the account holder in an unfair situation
where its bank account is being frozen for a transaction that has happened four years ago and where it was
not yet proven that it indeed participated in money laundering activities. A freeze order is an
extraordinary and interim relief issued by the CA to prevent the dissipation, removal, or disposal of
properties that are suspected to be the proceeds of, or related to, unlawful activities as defined in Section
3(i) of RA No. 9160, as amended. The primary objective of a freeze order is to temporarily preserve
monetary instruments or property that are in any way related to an unlawful activity or money laundering,
by preventing the owner from utilizing them during the duration of the freeze order. The relief is pre-
emptive in character, meant to prevent the owner from disposing his property and thwarting the State's
effort in building its case and eventually filing civil forfeiture proceedings and/or prosecuting the owner.
REPUBLIC OF THE PHILIPPINES v. SANDIGANBAYAN
G.R. NO. 232724-27, FEBRUARY 15, 2021
Leonen, J:

FACTS:

Lionair sold helicopters as brand new, but were already used. Miguel Arroyo was the owner of the
helicopters. To verify the source of deposit to Lionair’s account with Union Bank, the manager of Union
Bank where account was maintained was presented before the Prosecutor’s Office. The manager testified
that the account was closed on March 6, 2006. The Sandiganbayan issued a Subpoena Duces Tecum and
Ad Testificandum directing Executive Director Abad of Secretariat of Council to testify and to produce
Lionair’s bank records, which was met by a motion to quash due to the confidential nature of the records.

ISSUE:

Whether or Not AMLA prohibits AMLC from disclosing confidential and suspicious transaction reports

HELD:

No. The prohibition applies to institutions and persons that, under the law and by reason o their business,
possess information on covered and suspicious transactions. It supports the functions of the AMLC and
other prosecuting agencies. If these institutions were allowed to disclose information to anyone,
especially to persons subject of the report, their investigatory functions will be rendered ineffective.
However, this does not apply to AMLC. The text of AMLA reveals that AMLC is not one of the covered
institutions prohibited from disclosing information on covered and suspicious transactions. AMLC is even
mandated to investigate and use the information it has to institute cases against violators. AMLC is not a
mere repository of reports and information on covered and suspicious transactions. It is created precisely
to investigate and institute charges against the offenders. It is tasked to institute civil forfeiture
proceedings and other remedial proceedings, and to file complaints with DOJ or the Ombudsman for anti-
money laundering offenses.