WHO HAS AUTHORITY TO INQUIRE INTO BANK DEPOSITS?

• 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 the Anti-Money Laundering Act.
• The AMLC may only do so 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.
• Money laundering is a crime whereby the proceeds of an unlawful activity are transacted, thereby making them appear to have originated from legitimate sources.

The law says:

Sec. 11 of Republic Act No. 9160 or Anti-Money Laundering Act (AMLA) provides for the authority of the Anti-Money Laundering Council (AMLC). To wit:

“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.”

What is a Money Laundering Offense?

SEC. 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.

(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.”

Such authority vested in the AMLC may either be upon order of the court or in certain exceptional cases, without the order of the court.

A court order is necessary in order for the AMLC to exercise its authority to inquire into bank deposits in cases of violations of the AMLA, when it has been established upon ex parte application that there is probable cause that the deposits or investments, including related accounts involved, are related to an unlawful activity or a money laundering offense. (Sec. 11, AMLA.)

In contrast, a court order is not necessary when an unlawful activity is involved. Unlawful activity is referred to in Section 3(i) of AMLA. As such:

“Section 3. Definitions –

(i) “Unlawful activity” refers to any act or omission or series or combination thereof involving or having relation to the following:

1. Kidnapping for ransom under Article 267 of Act No. 3815, otherwise known as the Revised Penal Code, as amended;
2. Sections 3, 4, 5, 7, 8 and 9 of Article Two of Republic Act No. 6425, as amended, otherwise known as the Dangerous Drugs Act of 1972;
3. Section 3 paragraphs B, C, E, G, H and I of Republic Act No. 3019, as amended; otherwise known as the Anti-Graft and Corrupt Practices Act;
4. Plunder under Republic Act No. 7080, as amended;
5. Robbery and extortion under Articles 294, 295, 296, 299, 300, 301 and 302 of the Revised Penal Code, as amended;
6. Jueteng and Masiao punished as illegal gambling under Presidential Decree No. 1602;
7. Piracy on the high seas under the Revised Penal Code, as amended and Presidential Decree No. 532;
8. Qualified theft under Article 310 of the Revised Penal Code, as amended;
9. Swindling under Article 315 of the Revised Penal Code, as amended;
10. Smuggling under Republic Act Nos. 455 and 1937;
11. Violations under Republic Act No. 8792, otherwise known as the Electronic Commerce Act of 2000;
12. Hijacking and other violations under Republic 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;
13. Fraudulent practices and other violations under Republic Act No. 8799, otherwise known as the Securities Regulation Code of 2000;
14. Felonies or offenses of a similar nature that are punishable under the penal laws of other countries.”

Nevertheless, the authority of the AMLC to inquire into or examine the main and related accounts shall comply with the requirements of the 1987 Constitution on the right against unreasonable searches and seizures (Section 2, Article III) and right to privacy of communications and correspondence (Section 3, Article III).

Does the law authorize ex-parte issuance of a bank inquiry order?

No. It is evident that Section 11 does not specifically authorize, as a general rule, the issuance ex parte of the bank inquiry order.

The ex parte inquiry shall be upon probable cause that the deposits or investments are related to an unlawful activity as defined in Section 3(i) of the law or a money laundering offense under Section 4 of the same law. To effect the limit on the ex-parte inquiry, the petition under oath for authority to inquire, must, akin to the requirement of a petition for freeze order enumerated in Title VIII of A.M. No. 05-11-04-SC, contain the name and address of the respondent; the grounds relied upon for the issuance of the order of inquiry; and the supporting evidence that the subject bank deposit are in any way related to or involved in an unlawful activity. (Subido Pagente Certeza Mendoza and Binay Law Offices v. Court of Appeals, G.R. No. 216914, 06 December 2016.)

Does the authority of the AMLC to inquire into or examine bank accounts presupposes an existing case filed against the owner of such bank accounts?

No, inquiry into deposits under Section 11 of the AMLA does not require a pre-existing criminal case. (Republic v. Hon. Judge Eugenio, Jr., G.R. No. 174629, 14 February 2008.)