Ejercito vs. Sandiganbayan

SUPREME COURT REPORTS ANNOTATED VOLUME 509 1/19/22, 9:06 PM
190 SUPREME COURT REPORTS ANNOTATED

Ejercito vs. Sandiganbayan (Special Division)
*
G.R. Nos. 157294-95. November 30, 2006.
JOSEPH VICTOR G. EJERCITO, petitioner, vs.

SANDIGANBAYAN (SPECIAL DIVISION) and PEOPLE
OF THE PHILIPPINES, respondents.
Banks and Banking; Secrecy of Bank Deposits Act (Republic Act

No. 1405); An examination of Republic Act No. 1405 shows that the
term „deposits‰ used therein is to be understood broadly and not
limited only to accounts which give rise to a creditor-debtor
relationship between the depositor and the bank; If the money
deposited under an account may be used by banks for authorized
loans to third
_______________
* EN BANC.
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VOL. 509, NOVEMBER 30, 2006 191
persons, then such account, regardless of whether it creates a

creditor-debtor relationship between the depositor and the bank,
falls under the category of accounts which the law precisely seeks to
protect for the purpose of boosting the economic development of the
country.· The contention that trust accounts are not covered by the
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term „deposits,‰ as used in R.A. 1405, by the mere fact that they do
not entail a creditor-debtor relationship between the trustor and the
bank, does not lie. An examination of the law shows that the term
„deposits‰ used therein is to be understood broadly and not limited
only to accounts which give rise to a creditor-debtor relationship
between the depositor and the bank. The policy behind the law is
laid down in Section 1: SECTION 1. It is hereby declared to be the
policy of the Government to give encouragement to the people to
deposit their money in banking institutions and to 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. (Italics supplied) If the money deposited under an account
may be used by banks for authorized loans to third persons, then
such account, regardless of whether it creates a creditor-debtor
relationship between the depositor and the bank, falls under the
category of accounts which the law precisely seeks to protect for the
purpose of boosting the economic development of the country.
Same; Same; Statutory Construction; Words and Phrases; The
phrase „of whatever nature‰ proscribes any restrictive interpretation
of „deposits‰·Republic Act No. 1405 applies not only to money
which is deposited but also to those which are invested, such as those
placed in a trust account.·Section 2 of the same law in fact even
more clearly shows that the term „deposits‰ was intended to be
understood broadly: SECTION2.All deposits of whatever nature
with banks or banking institutions in the Philippines including
investments in bonds issued by the Government of the Philippines,
its political subdivisions and its instrumentalities, are hereby
considered as of an absolutely confidential nature and may not be
examined, inquired or looked into by any person, government
official, bureau or office, except upon written permission of the
depositor, or in cases of impeachment, or upon order of a competent
court in cases of bribery or dereliction of duty of public officials, or
in cases where the money deposited or invested is the subject
matter of the litigation. (Emphasis and italics supplied) The phrase
„of whatever nature‰ proscribes any restrictive interpretation of
„deposits.‰ Moreover, it is
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clear from the immediately quoted provision that, generally, the law
applies not only to money which is deposited but also to those which
are invested. This further shows that the law was not intended to
apply only to „deposits‰ in the strict sense of the word. Otherwise,
there would have been no need to add the phrase „or invested.‰
Clearly, therefore, R.A. 1405 is broad enough to cover Trust Account
No. 858.
Same; Same; The protection afforded by the Secrecy of Bank
Deposits Act law is, however, not absolute, there being recognized
exceptions thereto, as provided for in Section 2 of said law.·The
protection afforded by the law is, however, not absolute, there being
recognized exceptions thereto, as above-quoted Section 2 provides.
In the present case, two exceptions apply, to wit: (1) the
examination of bank accounts is upon order of a competent court in
cases of bribery or dereliction of duty of public officials, and (2) the
money deposited or invested is the subject matter of the litigation.
Same; Same; Public Officers; Plunder; Criminal Law; Bribery;
Cases of unexplained wealth are similar to cases of bribery or
dereliction of duty and no reason why these two classes of cases
cannot be excepted from the rule making bank deposits confidential
·and, undoubtedly, cases for plunder involve unexplained wealth.·
Petitioner contends that since plunder is neither bribery nor
dereliction of duty, his accounts are not excepted from the protection
of R.A. 1405. Philippine National Bank v. Gancayco, 15 SCRA 91,
96 (1965), holds otherwise: Cases of unexplained wealth are
similar to cases of bribery or dereliction of duty and no reason is
seen why these two classes of cases cannot be excepted from the rule
making bank deposits confidential. The policy as to one cannot be
different from the policy as to the other. This policy expresses
the notion that a public office is a public trust and any person
who enters upon its discharge does so with the full knowledge that
his life, so far as relevant to his duty, is open to public scrutiny.
Undoubtedly, cases for plunder involve unexplained wealth. Section
2 of R.A. No. 7080 states so.
Same; Same; Same; Same; Same; Same; The crime of bribery
and the overt acts constitutive of plunder are crimes committed by
public officers, and in either case the noble idea that „a public office
is a public trust and any person who enters upon its discharge does
so

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with the full knowledge that his life, so far as relevant to his duty, is
open to public scrutiny‰ applies with equal force.·All the above-
enumerated overt acts are similar to bribery such that, in each case,
it may be said that „no reason is seen why these two classes of cases
cannot be excepted from the rule making bank deposits
confidential.‰ The crime of bribery and the overt acts constitutive of
plunder are crimes committed by public officers, and in either case
the noble idea that „a public office is a public trust and any person
who enters upon its discharge does so with the full knowledge that
his life, so far as relevant to his duty, is open to public scrutiny‰
applies with equal force.
Same; Same; Same; Same; Same; Same; The plunder case now
pending with the Sandiganbayan necessarily involves an inquiry
into the whereabouts of the amount purportedly acquired illegally by
former President Joseph Estrada, and the subject matter of the
litigation cannot be limited to bank accounts under his name alone,
but must include those accounts to which the money purportedly
acquired illegally or a portion thereof was alleged to have been
transferred.· The plunder case now pending with the
Sandiganbayan necessarily involves an inquiry into the
whereabouts of the amount purportedly acquired illegally by former
President Joseph Estrada. In light then of this CourtÊs
pronouncement in Union Bank, the subject matter of the litigation
cannot be limited to bank accounts under the name of President
Estrada alone, but must include those accounts to which the money
purportedly acquired illegally or a portion thereof was alleged to
have been transferred. Trust Account No. 858 and Savings Account
No. 0116-17345-9 in the name of petitioner fall under this
description and must thus be part of the subject matter of the
litigation.
Same; Same; Searches and Seizures; Exclusionary Rule; Fruit
of the Poisonous Tree Doctrine; Where Congress has both established
a right and provided exclusive remedies for its violation, the courts

would be encroaching upon the prerogatives of Congress were they to

authorize a remedy not provided for by statute·absent a specific
reference to an exclusionary rule, it is not appropriate for the courts
to read such a provision into the act; R.A. No. 1405 nowhere
provides that an unlawful examination of bank accounts shall
render the evidence obtained therefrom inadmissible in evidence.·
PetitionerÊs attempt to make the exclusionary rule applicable to the
instant case
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fails. R.A. 1405, it bears noting, nowhere provides that an unlawful

examination of bank accounts shall render the evidence obtained
therefrom inadmissible in evidence. Section 5 of R.A. 1405 only
states that „[a]ny violation of this law will subject the offender upon
conviction, to an imprisonment of not more than five years or a fine
of not more than twenty thousand pesos or both, in the discretion of
the court.‰ The case of U.S. v. Frazin, 780 F.2d 1461 (1986),
involving the Right to Financial Privacy Act of 1978 (RFPA) of the
United States, is instructive. Because the statute, when properly
construed, excludes a suppression remedy, it would not be
appropriate for us to provide one in the exercise of our supervisory
powers over the administration of justice. Where Congress has both
established a right and provided exclusive remedies for its violation,
we would „encroach upon the prerogatives‰ of Congress were we to
authorize a remedy not provided for by statute. United States v.
Chanen, 549 F.2d 1306, 1313 (9th Cir.), cert. denied, 434 U.S. 825,
98 S.Ct. 72, 54 L.Ed.2d 83 (1977). The same principle was
reiterated in U.S. v. Thompson, 936 F.2d 1249 (1991): x x x When
Congress specifically designates a remedy for one of its acts, courts
generally presume that it engaged in the necessary balancing of
interests in determining what the appropriate penalty should be.
See Michaelian, 803 F.2d at 1049 (citing cases); Frazin, 780 F.2d at
1466. Absent a specific reference to an exclusionary rule, it is not
appropriate for the courts to read such a provision into the act.
Same; Same; Same; Same; Same; Words and Phrases; The

„fruit of the poisonous tree‰ doctrine presupposes a violation of law·

if there is no violation of R.A. No. 1405, then there would be no
„poisonous tree‰ to begin with, and, thus, no reason to apply the
doctrine.·Even assuming arguendo, however, that the exclusionary
rule applies in principle to cases involving R.A. 1405, the Court
finds no reason to apply the same in this particular case. Clearly,
the „fruit of the poisonous tree‰ doctrine presupposes a violation of
law. If there was no violation of R.A. 1405 in the instant case, then
there would be no „poisonous tree‰ to begin with, and, thus, no
reason to apply the doctrine.
Same; Same; Same; Same; Same; Judgments; When a doctrine
of the Supreme Court is overruled and a different view is adopted,
and more so when there is a reversal thereof, the new doctrine
should be applied prospectively and should not apply to parties who
relied on
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the old doctrine and acted in good faith.·For the Ombudsman

issued the subpoenas bearing on the bank accounts of petitioner
about four months before Marquez was promulgated on June 27,
2001. While judicial interpretations of statutes, such as that made
in Marquez with respect to R.A. No. 6770 or the Ombudsman Act of
1989, are deemed part of the statute as of the date it was originally
passed, the rule is not absolute. Columbia Pictures, Inc. v. Court of
Appeals, 261 SCRA 144 (1996), teaches: It is consequently clear that
a judicial interpretation becomes a part of the law as of the date
that law was originally passed, subject only to the qualification
that when a doctrine of this Court is overruled and a
different view is adopted, and more so when there is a
reversal thereof, the new doctrine should be applied
prospectively and should not apply to parties who relied on the old
doctrine and acted in good faith. (Emphasis and italics supplied)
When this Court construed the Ombudsman Act of 1989, in light of
the Secrecy of Bank Deposits Law in Marquez, that „before an in
camera inspection may be allowed there must be a pending case

before a court of competent jurisdiction,‰ it was, in fact, reversing

an earlier doctrine found in Banco Filipino Savings and Mortgage
Bank v. Purisima, 161 SCRA 576 (1988).
Same; Same; Same; Same; Same; Same; The Marquez v.
Desierto, 359 SCRA 772 (2001), ruling that „the account holder must
be notified to be present during the inspection‰ may not be applied
retroactively to the inquiry of the Ombudsman subject of this case
since said ruling is not a judicial interpretation either of R.A. 6770
or R.A. 1405, but a „judge-made‰ law which can only be given
prospective application.·The Marquez ruling that „the account
holder must be notified to be present during the inspection‰ may not
be applied retroactively to the inquiry of the Ombudsman subject of
this case. This ruling is not a judicial interpretation either of R.A.
6770 or R.A. 1405, but a „judge-made‰ law which, as People v.
Luvendino, 211 SCRA 36 (1992), instructs, can only be given
prospective application: x x x The doctrine that an
uncounselled waiver of the right to counsel is not to be
given legal effect was initially a judgemade one and was first
announced on 26 April 1983 in Morales v. Enrile and
reiterated on 20 March 1985 in People v. Galit. x x x While the
Morales-Galit doctrine eventually became part of Section 12(1) of
the 1987 Constitution, that doctrine affords no comfort to appellant
Luvendino for the requirements and restric-
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tions outlined in Morales and Galit have no retroactive effect

and do not reach waivers made prior to 26 April 1983 the date
of promulgation of Morales. (Emphasis supplied) In fine, the
subpoenas issued by the Ombudsman in this case were legal, hence,
invocation of the „fruit of the poisonous tree‰ doctrine is misplaced.
AT ALL EVENTS, even if the challenged subpoenas are quashed,
the Ombudsman is not barred from requiring the production of the
same documents based solely on information obtained by it from
sources independent of its previous inquiry.
Same; Same; Same; Same; Same; Presumption of Regularity; To

presume that the information was obtained in violation of R.A. No.

1405 would infringe the presumption of regularity in the
performance of official functions.·The information on the existence
of Bank Accounts bearing number „858‰ was, according to
respondent People of the Philippines, obtained from various sources
including the proceedings during the impeachment of President
Estrada, related reports, articles and investigative journals. In the
absence of proof to the contrary, this explanation proffered by
respondent must be upheld. To presume that the information was
obtained in violation of R.A. 1405 would infringe the presumption of
regularity in the performance of official functions.
SANDOVAL-GUTIERREZ, J., Dissenting Opinion:
Banks and Banking; Secrecy of Bank Deposits Act (R.A. No.

1405); The rationale for R.A. No. 1405 is to discourage private
hoarding and encourage the people to deposit money in banks to be
utilized in authorized loans.·On September 9, 1955, the Philippine
Legislature enacted R.A. No. 1405. Its rationale is to discourage
private hoarding and encourage people to deposit money in banks to
be utilized in authorized loans. It happened that after World War II,
capital and credit facilities for agricultural and industrial
development in the country were lacking. Rehabilitation of the
banking system became a major government thrust. However,
private hoarding of money was rampant because people feared
government inquiry into their bank deposits and bond investments
for tax collection purposes. Thus, even if the members of Congress
at that time recognized the possible danger of R.A. No. 1405, such
as providing a climate conducive to tax evasion, still, they passed
the law with the belief that the benefits accruing to the economy
with the influx of
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deposits and bond investments would counterbalance immeasurably

the losses of the Government from such tax evasion.
Same; Same; Criminal Law; Plunder; If the criminal acts that

make up the crime of plunder are categorized as exceptions to the

confidentiality rule, with more reason that the more serious crime of
plunder should be considered as falling within the same exception.·
A reading of the provisions of the Revised Penal Code concerning
bribery and dereliction of duty, as well as corrupt practices under
R.A. 3019, readily shows the striking resemblance between them
and the predicate crimes of plunder. Paragraph 2 actually
constitutes indirect bribery while paragraphs 4 and 5 constitute
corrupt practices under R.A. No. 3019. Logically, if the criminal acts
that make up the crime of plunder are categorized as exceptions to
the confidentiality rule, with more reason that the more serious
crime of plunder should be considered as falling within the same
exception. All involve dishonesty and lack of integrity in
public service. There is no reason why plunder should be treated
differently.
Same; Same; Searches and Seizures; Right to Privacy;
Financial transactions can reveal much about a personÊs affairs,
activities, beliefs, habits and associations·oneÊs bank account
mirrors not only his finances, but also his debts, his way of life, his
family and his civic commitment, a reality which places a customerÊs
bank account within the „expectations of privacy‰ category.·It
cannot be gainsaid that the customer of a bank expects that the
documents which he transmits to the bank in the course of his
business operations, will remain private, and that such an
expectation is reasonable. Financial transactions can reveal much
about a personÊs affairs, activities, beliefs, habits and associations.
Indeed, the totality of bank records provides a virtual current
biography. Checks, for instance, in a sense, define a person. By
examining them, the agents get to know his doctors, lawyers,
creditors, political allies, social connections, religious affiliations,
educational interests, the papers and magazines he reads, and so on
ad infinitum. In other words, oneÊs bank account mirrors not only
his finances, but also his debts, his way of life, his family and his
civic commitment. Such reality places a customerÊs bank account
within the „expectations of privacy‰ category. In the Philippines, the
expectation is heightened by the enactment of R.A. No. 1405 which
mandates that all deposits of whatever nature are considered as of
an „absolutely confidential nature‰ and
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„may not be examined, inquired or looked into by any

person‰ except under the instances therein.
Same; Same; Same; Same; The customerÊs reasonable
expectation is that, absent customary legal process, the matter he
reveals to the bank will be utilized by the bank only for internal
banking purposes.·Admittedly, a bank customer knowingly and
voluntarily divulges his financial affairs with the bank, but such is
immaterial. The fact that one has disclosed private papers to the
bank within the context of confidential customer-bank relationship,
does not mean that one has waived all right to the privacy of the
papers. Like the user of the pay phone in Katz v. United States, 389
U.S. 347 (1967), who, having paid the toll, was entitled to „assume
that the words he utters into the mouthpiece will not be broadcast
to the world,‰ so the customer of a bank, having written or
deposited a check, has a reasonable expectation that his check will
be examined for bank purposes only. Practically speaking, a
customerÊs disclosure of his financial affairs is not entirely
volitional, since it is impossible to participate in the economic life of
contemporary society without maintaining a bank account.
Consequently, the customerÊs reasonable expectation is that,
absent customary legal process, the matter he reveals to the
bank will be utilized by the bank only for internal banking
purposes.
Same; Same; Same; Same; The authority of the Ombudsman „to
examine and have access to bank accounts and records‰ must be
read in conjunction with Section 2 of R.A. No. 1405 providing that
deposits of whatever nature shall be considered confidential except
in several instances already mentioned because bank deposits belong
to a protected zone where government intrusion could infringe
legitimate expectation of privacy.·At this point, it should be
emphasized that the authority of the Ombudsman „to examine and
have access to bank accounts and records‰ must be read in
conjunction with Section 2 of R.A. No. 1405 providing that deposits
of whatever nature shall be considered confidential except in
several instances already mentioned. This is because bank
deposits belong to a protected zone where government
intrusion could infringe legitimate expectation of privacy.
An opposite course is unwarranted. In United States v. United

States District Court, 407 U.S. 297, the US Supreme Court held
that the potential for abuse is particularly acute where the
legislative scheme permits ac-
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cess to information without invocation of the judicial

process. In such instances, the important responsibility for
balancing societal and individual interests is left to unreviewed
executive discretion, rather than the scrutiny of a neutral
magistrate. In Katz v. United States, 389 U.S. 347 (1967), the same
Court ruled that, „[t[he prosecutorsÊ duty and responsibility is to
enforce the laws, to investigate and to prosecute. Those charged
with the investigative and prosecutorial duty should not be the sole
judges of when to utilize constitutionally sensitive means in
pursuing their tasks. The historical judgment is that
unreviewed executive discretion may yield too readily to
pressures to obtain incriminating evidence and overlook
potential invasions of privacy.‰ Between the government and
the citizen, there must be a neutral entity that should balance the
formerÊs claim of authority vis-á-vis the latterÊs assertion of rights.
Same; Same; Same; Same; Ombudsman; By the natural scheme
of things, the Office of the Ombudsman can hardly be characterized
as detached, disinterested and neutral as its mandate is to
investigate and prosecute any act or omission of any public officer or
employee, office or agency that appears to be illegal, unjust,
improper or inefficient.·By the natural scheme of things, the Office
of the Ombudsman can hardly be characterized as detached,
disinterested and neutral. Its mandate is to investigate and
prosecute any act or omission of any public officer or employee,
office or agency that appears to be illegal, unjust, improper or
inefficient. In carrying out such mandate, it is expected to act with
vigor and aggressiveness. But to permit such office to have access to
bank records without any judicial control as to relevancy or other
traditional requirements of due process and to allow the evidence to
be used in any subsequent prosecution, opens the door to a vast and

unlimited range of very real abuses of police power. True, there are
administrative summonses for documents recognized in other
jurisdictions, but there is a requirement that their enforcement
receives a judicial scrutiny and a judicial order. In this regard, I am
appalled by the „whole sale‰ subpoena duces tecum issued by the
Ombudsman directing the „President or Chief Executive Officer of
Urban Bank‰ to produce „bank records and all documents
relative thereto pertaining to all bank accounts (Savings,
Current, Time Deposit, Trust, Foreign Currency Deposits,
etc.) under the account names of Jose Velarde, Joseph E.
Estrada, Laarni Enriquez, Guia Go-
200
mez, Joy Melendrez, Peachy Osorio, Rowena Lopez, Kevin or

Kelvin Garcia, 727, 737, 747, 757 and 858.‰ Indubitably, such
blanket subpoena provides occasions for „fishing expedition.‰
Same; Same; Same; Same; Same; Due Process; Basic due
process demands that the Office of the Ombudsman furnish the bank
account holder a copy of the subpoena duces tecum it issued.·Above
everything else, however, what strikes us most is the patent
unfairness of the process. First in the Bill of Rights is the mandate
that no person shall be deprived of his life, liberty or property
without due process of law. Courts have held that the right of
personal privacy is one aspect of the „liberty‰ protected by
the Due Process Clause. Basic due process demands that the
Office of the Ombudsman furnish petitioner a copy of the subpoenae
duces tecum it issued. In Marquez v. Desierto, 359 SCRA 772 (2001),
this Court held: „The bank personnel and the account holder
must be notified to be present during the inspection, and
such inspection may cover only the account identified in the
pending case.‰ Such notice is not too much to ask for, after all, an
account-holder bears the risk not only of losing his privacy but, also,
his property. Of course, not to mention the procedural impasse that
is encountered by such accountholder who cannot contest the
propriety of the issuance of a subpoena.

Same; Same; Same; Same; Same; Same; Something is

inherently wrong in a public proceeding that allows a holder of bank
account, subject of litigation, to be completely uninformed·every
civilized state adheres to the principle that when a personÊs life and
liberty are jeopardized by government action, it behooves a
democratic government to see to it that this jeopardy is fair,
reasonable and according to time-honored tradition.·The
proceedings before respondent Sandiganbayan also leave much to
be desired. Neither respondent Sandiganbayan nor the Special
Prosecution Panel nor PDIC furnished petitioner copies of the
subpoenae duces tecum/ad testificandum or of the requests for their
issuance. It bears reiterating that it was only through the media
that petitioner learned about such requests. Definitely, something is
inherently wrong in a public proceeding that allows a holder of
bank account, subject of litigation, to be completely uninformed.
Also not to be overlooked is the respondent SandiganbayanÊs oral
directive to petitioner to file his motion to quash not later than
12:00 noon of January 28, 2003. This notwith-
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standing the fact that it was only the day before, or on January 27,
2003, that petitioner learned about the requests and that he was
yet to procure the services of a counsel. Every civilized state
adheres to the principle that when a personÊs life and liberty are
jeopardized by government action, it behooves a democratic
government to see to it that this jeopardy is fair, reasonable and
according to time-honored tradition. The importance of this
principle is eloquently underscored by one observer who
said: „The quality of a civilization is largely determined by the
fairness of its criminal trials.‰
CALLEJO, SR., J., Concurring Opinion:
Criminal Law; Plunder; Public Officers; It can be readily

gleaned that the gravamen of plunder is the amassing,
accumulating or acquiring of ill-gotten wealth by a public officer, his

family or close associates; a plain reading of the definition of

plunder and the manner by which it may be committed as provided
in Republic Act 7080 reveals that its policy also rests upon the
fundamental tenet that „public office is a public trust.‰·It can be
readily gleaned that the gravamen of plunder is the amassing,
accumulating or acquiring of ill-gotten wealth by a public officer, his
family or close associates. In Philippine National Bank v. Gancayco,
15 SCRA 91 (1965), the Court explained that „cases of unexplained
wealth are similar to cases of bribery or dereliction of public duty
and no reason is seen why these two classes of cases cannot be
excepted from the rule making bank deposits confidential. The
policy as to one cannot be different from the policy as to the other.
This policy expresses the notion that a public office is a public trust
and any person enters upon its discharge does so with full
knowledge that his life, so far as relevant to his duty, is open to
public scrutiny.‰ A plain reading of the definition of plunder and the
manner by which it may be committed as provided in RA 7080
reveals that its policy also rests upon the fundamental tenet that
„public office is a public trust.‰ There is thus no cogent reason to
treat plunder any different from the cases of bribery or dereliction
of public duty for purposes of RA 1405.
Same; Same; Same; Considering the mind-boggling sums of
money that flowed out of the petitionerÊs Trust Account and its nexus
to former President EstradaÊs alleged Jose Velarde account, it is
logical for the prosecution to pursue the theory that the money in the
202
said trust account forms part of the unexplained wealth of the latter.
·At this point, it is well to mention that based on the evidence
presented by the prosecution before the Sandiganbayan, hundreds
of millions of pesos flowed from the petitionerÊs Trust Account No.
858 to the alleged Jose Velarde account purportedly maintained by
former President Estrada at Equitable PCIBank. In fact, one
managerÊs check, marked as Exhibit „L‰ for the prosecution, in the
amount of P107,191,780.85 was drawn from, and funded by the said

trust account of petitioner JV Ejercito. Considering the mind-

boggling sums of money that flowed out of the petitionerÊs Trust
Account No. 858 and its nexus to former President EstradaÊs alleged
Jose Velarde account, it is logical for the prosecution to pursue the
theory that the money in the said trust account forms part of the
unexplained wealth of the latter. As such, the money in the
accounts of the petitioner may be properly considered as „subject
matter‰ of the plunder cases falling under number (6) of the
enumerated exceptions to the absolute confidentiality of bank
deposits.
Same; Same; Same; Judgments; Marquez v. Desierto, 359 SCRA
772 (2001), which applied and interpreted the power of the Office of
the Ombudsman under Section 15(8) of RA 6770 cannot be given
retroactive application·„judge-made‰ laws are to be applied
prospectively.·The Marquez ruling, it bears reiterating, came after
the subpoenas were issued by the Office of the Ombudsman and the
PDIC and Urban Bank had already complied therewith by
furnishing it the necessary information. The said information
cannot thus be considered „illegal‰ because Marquez, which applied
and interpreted the power of the Office of the Ombudsman under
Section 15(8) of RA 6770, cannot be given retroactive application. In
Filoteo, Jr. v. Sandiganbayan, 263 SCRA 222 (1996), the Court
emphasized that „judge-made‰ laws are to be applied prospectively:
The prospective application of „judge-made‰ laws was underscored
in Co v. Court of Appeals, where the Court ruled thru Chief Justice
Andres R. Narvasa that in accordance with Article 8 of the Civil
Code which provides that „(j)udicial decisions applying or
interpreting the laws or the Constitution shall form part of the legal
system of the Philippines,‰ and Article 4 of the same Code which
states that „(l)aws shall have no retroactive effect unless the
contrary is provided,‰ the principle of prospectivity of statutes,
original or amendatory, shall apply to judicial decisions, which,
although in themselves are not laws, are nevertheless evidence of
what the law means.
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SPECIAL CIVIL ACTION in the Supreme Court.

Certiorari.
The facts are stated in the opinion of the Court.
Rufus B. Rodriguez & Associates for petitioner.
The Solicitor General for respondents.
CARPIO-MORALES, J.:
The present petition for certiorari under Rule 65 assails the

Sandiganbayan Resolutions dated February 7 and 12, 2003
denying petitioner Joseph Victor G. EjercitoÊs Motions to
Quash Subpoenas Duces Tecum/Ad Testificandum, and
Resolution dated March 11, 2003 denying his Motion for
Reconsideration of the first two resolutions.
The three resolutions were issued in Criminal Case No.
26558, „People of the Philippines v. Joseph Ejercito
Estrada, et al.,‰ for plunder, defined and penalized in R.A.
7080, „AN ACT DEFINING AND PENALIZING THE
CRIME OF PLUNDER.‰
In above-stated case of 1
People v. Estrada, et al., the
Special Prosecution Panel filed on January 20, 2003 before
the Sandiganbayan a Request for Issuance of Subpoena
Duces Tecum for the issuance of a subpoena directing the
President of Export and Industry Bank (EIB, formerly
Urban Bank) or his/her authorized representative to
produce the following documents during the hearings
scheduled on January 22 and 27, 2003:
I. For Trust Account No. 858;
1. Account Opening Documents;

2. Trading Order No. 020385 dated January 29, 1999;
3. Confirmation Advice TA 858;
_______________
1 Composed of the Ombudsman, the Special Prosecutor, Deputy Special

Prosecutor, Assistant Ombudsman, Special Prosecution Officer III, and Special
Prosecution Officer II, (Rollo, pp. 492-493).
204


4. Original/Microfilm copies, including the dorsal side, of the

following:
a. Bank of Commerce MC # 0256254 in the amount of

P2,000,000.00;
b. Urban bank Corp. MC # 34181 dated November 8, 1999 in
the amount of P10,875,749.43;
c. Urban Bank MC # 34182 dated November 8, 1999 in the
amount of P42,716,554.22;
d. Urban Bank Corp. MC # 37661 dated November 23, 1999 in
the amount of P54,161,496.52;
5. Trust Agreement dated January 1999:

Trustee: Joseph Victor C. Ejercito
Nominee: URBAN BANK-TRUST DEPARTMENT
Special Private Account No. (SPAN) 858; and
6. Ledger of the SPAN # 858.
II. For Savings Account No. 0116-17345-9
SPAN No. 858
1. Signature Cards; and

2. Statement of Account/Ledger
III. Urban Bank ManagerÊs Check and their corresponding Urban

Bank ManagerÊs Check Application Forms, as follows:
1. MC # 039975 dated January 18, 2000 in the amount of

P70,000,000.00;
P2,000,000.00;
P2,000,000.00;
P1,000,000.00;
The Special Prosecution Panel also filed on January 20,

2003, a Request for Issuance of Subpoena Duces Tecum/Ad
Testificandum directed to the authorized representative of
Equitable-PCI Bank to produce statements of account per-

205
VOL. 509, NOVEMBER 30, 2006 205

taining to certain accounts in the name of „Jose Velarde‰

and to testify thereon.
The Sandiganbayan granted both requests by Resolution
of January 21, 2003 and subpoenas were accordingly
issued.
The Special Prosecution Panel filed still another
Request for Issuance of Subpoena Duces Tecum/Ad
Testificandum dated January 23, 2003 for the President of
EIB or his/her authorized representative to produce the
same documents subject of the Subpoena Duces Tecum
dated January 21, 2003 and to testify thereon on the
hearings scheduled on January 27 and 29, 2003 and
subsequent dates until completion of the testimony. The
request was likewise granted by the Sandiganbayan. A
Subpoena Duces Tecum/Ad Testificandum was accordingly
issued on January 24, 2003.
Petitioner, claiming to have learned from the media that
the Special Prosecution Panel had requested for the
issuance of subpoenas for the examination of bank accounts
belonging to him, attended the hearing of the case on
January 27, 2003 and filed before the Sandiganbayan a
letter of even date expressing his concerns as follows,
quoted verbatim:
Your Honors:
It is with much respect that I write this court relative to the

concern of subpoenaing the undersignedÊs bank account which I
have learned through the media.
I am sure the prosecution is aware of our banking secrecy laws
everyone supposed to observe. But, instead of prosecuting those who
may have breached such laws, it seems it is even going to use
supposed evidence which I have reason to believe could only have
been illegally obtained.
The prosecution was not content with a general request. It even
lists and identifies specific documents meaning someone else in the
bank illegally released confidential information.

If this can be done to me, it can happen to anyone. Not that

anything can still shock our family. Nor that I have anything to
hide. Your Honors.
206

But, I am not a lawyer and need time to consult one on a situation

that affects every bank depositor in the country and should interest
the bank itself, the Bangko Sentral ng Pilipinas, and maybe the
Ombudsman himself, who may want to investigate, not exploit, the
serious breach that can only harm the economy, a consequence that
may have been overlooked. There appears to have been deplorable
connivance.
xxxx
I hope and pray, Your Honors, that I will be given time to retain
the services of a lawyer to help me protect my rights and those of
every banking depositor. But the one I have in mind is out of the
country right now.
May I, therefore, ask your Honors, that in the meantime, the
issuance of the subpoena be held in abeyance for at least ten (10)
days to enable me to take appropriate legal steps in connection with
the prosecutionÊs request for the issuance of subpoena concerning
my accounts. (Emphasis supplied)
From the present petition, it is gathered that the

„accounts‰ referred to by petitioner in his above-quoted
letter are Trust
2
Account No. 858 and Savings Account No.
0116-17345-9.
In open court, the Special Division of the
Sandiganbayan, through Associate Justice Edilberto
Sandoval, advised petitioner that his remedy was to file a
motion to quash, for which he was given up to 12:00 noon
the following day, January 28, 2003.
_______________
2 „Petitioner is the owner of Trust Account No. 858 which was

originally opened at Urban Bank but which is now maintained at Export
and Industry Bank, which is the purchaser and owner now of the former

Urban Bank and Urbancorp Investment, Inc. Petitioner is also the owner
of Savings Account No. 0116-17345-9 which was originally opened at
Urban Bank but which is now maintained at Export and Industry Bank,
which is the purchaser and owner of the former Urban Bank and
Urbancorp Investment, Inc. x x x‰ (Petition, pp. 3-4, Rollo, pp. 10-11)
207
VOL. 509, NOVEMBER 30, 2006 207

Petitioner, unassisted by counsel, thus filed on January 28,

2003 a Motion to Quash Subpoena Duces Tecum/Ad
Testificandum praying that the subpoenas previously
issued to the President of the3 EIB dated January 21 and
January 24, 2003 be quashed.
In his Motion to Quash, petitioner claimed that his bank
accounts are covered by R.A. No. 1405 (The Secrecy of
Bank Deposits Law) and do not fall under any of the
exceptions stated therein. He further claimed that the
specific identification of documents in the questioned
subpoenas, including details on dates and amounts, could
only have been made
_______________
3 The first paragraph of the motion identifies the subpoenas sought to

be quashed as those allegedly issued on January 24, 2003 directed to the
representative/s of the Urban Bank (now EIB) and to Ms. Aurora C.
Baldoz, Vice-President-CR-II of the Philippine Deposit Insurance
Corporation. However, the second motion to quash later filed by
petitioner with the assistance of counsel stated that the subpoenas
subject of the previous motion to quash were those issued on January 21,
2003, addressed to the President of the EIB and to the President of
Equitable-PCI Bank, or their representatives.
Despite the apparent conflict, it may be inferred that the first motion
to quash covered the subpoenas directed to the President of the EIB
dated January 21, 2003 and January 24, 2003, the January 24 subpoena
being a mere reiteration of the January 21 subpoena. As there is nothing
in the records before this Court which show that a subpoena dated
January 24, 2003 was ever issued to Ms. Baldoz, the Court will consider
petitionerÊs first Motion to Quash as concerned only with the subpoenas

directed to the President of the EIB.

The statement in the second motion to quash that the first motion
covered the January 21 subpoenas issued to the President of EIB and to
the President of Equitable-PCI Bank may only be an error arising
from the fact that a subpoena to each of these officers were granted by
the Sandiganbayan through the same Resolution dated January 21,
2003. The petitioner could not have been referring to the subpoena
directed to the President of Equitable-PCI Bank since the subject thereof
were the Jose Velarde accounts which he has never claimed to be his,
even in the present petition.
208

possible by an earlier illegal disclosure thereof by the EIB

and the Philippine Deposit Insurance Corporation (PDIC)
in its capacity as receiver of the then Urban Bank.
The disclosure being illegal, petitioner concluded, the
prosecution in the case may not be allowed to make use of
the information.
Before the Motion to Quash was resolved by the
Sandiganbayan, the prosecution filed another Request for
the Issuance of Subpoena Duces Tecum/Ad Testificandum
dated January 31, 2003, again to direct the President of the
EIB to produce, on the hearings scheduled on February 3
and 5, 2003, the same documents subject of the January 21
and 24, 2003 subpoenas with the exception of the Bank of
Commerce MC #0256254 in the amount of P2,000,000 as
Bank of Commerce MC #0256256 in the amount of
P200,000,000 was instead requested. Moreover, the request
covered the following additional documents:
IV. For Savings Account No. 1701-00646-1:
1. Account Opening Forms;

2. Specimen Signature Card/s; and
3. Statements of Account.
The prosecution also filed a Request for the Issuance of

Subpoena Duces Tecum/Ad Testificandum bearing the same

date, January 31, 2003, directed to Aurora C. Baldoz, Vice

President-CR-II of the PDIC for her to produce the
following documents on the scheduled hearings on
February 3 and 5, 2003:
„1. Letter of authority dated November 23, 1999 re:

SPAN [Special Private Account Number] 858;
2. Letter of authority dated January 29, 2000 re:
SPAN 858;
3. Letter of authority dated April 24, 2000 re: SPAN
858;
4. Urban Bank check no. 052092 dated April 24, 2000
for the amount of P36, 572, 315.43;
209
VOL. 509, NOVEMBER 30, 2006 209

5. Urban Bank check no. 052093 dated April 24, 2000

for the amount of P107,191,780.85; and
6. Signature Card Savings Account No. 0116-17345-9.‰
(Italics supplied)
The subpoenas prayed for in both requests were issued by

the Sandiganbayan on January 31, 2003.
On February 7, 2003, petitioner, this time assisted by
counsel, filed an Urgent Motion to Quash Subpoenae Duces
Tecum/Ad Testificandum praying that the subpoena dated
January 31, 2003 directed to Aurora Baldoz be quashed4 for
the same reasons which he cited in the Motion to Quash he
had earlier filed.
On the same day, February 7, 2003, the
Sandiganbayan issued a Resolution denying petitionerÊs
Motion to Quash Subpoenae Duces Tecum/Ad
Testificandum dated January 28, 2003.
Subsequently or on February 12, 2003, the
Sandiganbayan issued a Resolution denying petitionerÊs
Urgent Motion to Quash Subpoena Duces Tecum/Ad
Testificandum dated February 7, 2003.
PetitionerÊs Motion for Reconsideration dated February

24, 2003 seeking a reconsideration of the Resolutions of

February 7 and 12, 2003 having been denied by Resolution
of March 11, 2003, petitioner filed the present petition.
Raised as issues are:
1. Whether petitionerÊs Trust Account No. 858 is

covered by the term „deposit‰ as used in R.A. 1405;
2. Whether petitionerÊs Trust Account No. 858 and
Savings Account No. 0116-17345-9 are excepted
from the protection of R.A. 1405; and
3. Whether the „extremely-detailed‰ information
contained in the Special Prosecution PanelÊs
requests for subpoena was obtained
_______________
4 Rollo, p. 171.
210

through a prior illegal disclosure of petitionerÊs

bank accounts, in violation of the „fruit of the
poisonous tree‰ doctrine.
5
Respondent People posits that Trust Account No. 858 may
be inquired into, not merely because it falls under the
exceptions to the coverage of R.A. 1405, but because it is
not even contemplated therein. For, to respondent People,
the law applies only to „deposits‰ which strictly means the
money delivered to the bank by which a creditor-debtor
relationship is created between the depositor and the bank.
The contention that trust accounts are not covered by
the term „deposits,‰ as used in R.A. 1405, by the mere fact
that they do not entail a creditor-debtor relationship
between the trustor and the bank, does not lie. An
examination of the law shows that the term „deposits‰ used
therein is to be understood broadly and not limited only to
accounts which give rise to a creditor-debtor relationship

between the depositor and the bank.

The policy behind the law is laid down in Section 1:
„SECTION 1. It is hereby declared to be the policy of the

Government to give encouragement to the people to deposit their
money in banking institutions and to 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.‰ (Italics
supplied)
If the money deposited under an account may be used by

banks for authorized loans to third persons, then such
account, regardless of whether it creates a creditor-debtor
relationship between the depositor and the bank, falls
under the category of accounts which the law precisely
seeks to protect for the purpose of boosting the economic
development of the country.
_______________
5 Respondent People of the Philippines argue on the premise that

Trust Account No. 858 covers Savings Account No. 0116-17345-9.
211
VOL. 509, NOVEMBER 30, 2006 211

Trust Account No. 858 is, without doubt, one such account.
The Trust Agreement between petitioner and Urban Bank
provides that the trust account covers „deposit, placement
or investment
6
of funds‰ by Urban Bank for and in behalf of
petitioner. The money deposited under Trust Account No.
858, was, therefore, intended not merely to remain with the
bank but to be invested by it elsewhere. To hold that this
type of account is not protected by R.A. 1405 would
encourage private hoarding of funds that could otherwise
be invested by banks in other ventures, contrary to the
policy behind the law.
Section 2 of the same law in fact even more clearly
shows that the term „deposits‰ was intended to be
understood broadly:

SECTION 2. All deposits of whatever nature with banks or

banking institutions in the Philippines including investments in
bonds issued by the Government of the Philippines, its political
subdivisions and its instrumentalities, are hereby considered as of
an absolutely confidential nature and may not be examined,
inquired or looked into by any person, government official, bureau
or office, except upon written permission of the depositor, or in cases
of impeachment, or upon order of a competent court in cases of
bribery or dereliction of duty of public officials, or in cases where
the money deposited or invested is the subject matter of the
litigation.‰ (Emphasis and italics supplied)
The phrase „of whatever nature‰ proscribes any restrictive

interpretation of „deposits.‰ Moreover, it is clear from the
immediately quoted provision that, generally, the law
applies not only to money which is deposited but also to
those which are invested. This further shows that the law
was not intended to apply only to „deposits‰ in the strict
sense of the word. Otherwise, there would have been no
need to add the phrase „or invested.‰
Clearly, therefore, R.A. 1405 is broad enough to cover
Trust Account No. 858.
_______________
6 Rollo, p. 708.
212

The protection afforded by the law is, however, not

absolute, there being recognized exceptions thereto, as
abovequoted Section 2 provides. In the present case, two
exceptions apply, to wit: (1) the examination of bank
accounts is upon order of a competent court in cases of
bribery or dereliction of duty of public officials, and (2) the
money deposited or invested is the subject matter of the
litigation.
Petitioner contends that since plunder is neither bribery
nor dereliction of duty, his accounts are not excepted from

the protection
7
of R.A. 1405. Philippine National Bank v.
Gancayco holds otherwise:
„Cases of unexplained wealth are similar to cases of bribery or

dereliction of duty and no reason is seen why these two classes of
cases cannot be excepted from the rule making bank deposits
confidential. The policy as to one cannot be different from the policy
as to the other. This policy expresses the notion that a public
office is a public trust and any person who enters upon its
discharge does so with the full knowledge that his life, so far as
relevant to his duty, is open to public scrutiny.‰
Undoubtedly, cases for plunder involve unexplained wealth.

Section 2 of R.A. No. 7080 states so.
„SECTION 2. Definition of the Crime of Plunder; Penalties.·Any

public officer who, by himself or in connivance with members of
his family, relatives by affinity or consanguinity, business associates,
subordinates or other persons, amasses, accumulates or acquires
ill-gotten wealth through a combination or series of overt or
criminal acts as described in Section 1(d) hereof, in the aggregate
amount or total value of at least Seventy-five million pesos
(P75,000,000.00), shall be guilty of the crime of plunder and shall
be punished by life imprisonment with perpetual absolute
disqualification from holding any public office. Any person who
participated with said public officer in the commission of plunder
shall likewise be punished. In the imposition of penalties, the
degree of participation and the attendance of mitigating and
extenuating circumstances
_______________
7 122 Phil. 503, 508; 15 SCRA 91, 96 (1965).
213
VOL. 509, NOVEMBER 30, 2006 213

shall be considered by the court. The court shall declare any and all
ill-gotten wealth and their interests and other incomes and assets
including the properties and shares of stock derived from the
deposit or investment thereof forfeited in favor of the State.

(Emphasis and italics supplied)
An examination of the „overt or criminal acts as described

in Section 1(d)‰ of R.A. No. 7080 would make the similarity
between plunder and bribery even more pronounced since
bribery is essentially included among these criminal acts.
Thus Section 1(d) states:
d) „Ill-gotten wealth‰ means any asset, property,

business enterprise or material possession of any
person within the purview of Section Two (2) hereof,
acquired by him directly or indirectly through
dummies, nominees, agents, subordinates and or
business associates by any combination or series of
the following means or similar schemes.
1) Through misappropriation, conversion, misuse, or

malversation of public funds or raids on the public
treasury;
2) By receiving, directly or indirectly, any
commission, gift, share, percentage, kickbacks
or any other form of pecuniary benefit from
any person and/or entity in connection with
any government contract or project or by
reason of the office or position of the public
officer concerned;
3) By the illegal or fraudulent conveyance or
disposition of assets belonging to the National
Government or any of its subdivisions, agencies or
instrumentalities or government-owned or -
controlled corporations and their subsidiaries;
4) By obtaining, receiving or accepting directly or
indirectly any shares of stock, equity or any other
form of interest or participation including promise
of future employment in any business enterprise or
undertaking;
5) By establishing agricultural, industrial or
commercial monopolies or other combinations
and/or implementation of decrees and orders
intended to benefit particular persons or special
interests; or

214

6) By taking undue advantage of official position,

authority, relationship, connection or influence to
unjustly enrich himself or themselves at the
expense and to the damage and prejudice of the
Filipino people and the Republic of the Philippines.‰
(Emphasis supplied)
Indeed, all the above-enumerated overt acts are similar to

bribery such that, in each case, it may be said that „no
reason is seen why these two classes of cases cannot be8
excepted from the rule making bank deposits confidential.‰
The crime of bribery and the overt acts constitutive of
plunder are crimes committed by public officers, and in
either case the noble idea that „a public office is a public
trust and any person who enters upon its discharge does so
with the full knowledge that his life, so far as relevant to
his duty, is open to public scrutiny‰ applies with equal
force.
Plunder being thus analogous to bribery, the exception
to R.A. 1405 applicable in cases of bribery must also apply
to cases of plunder.
Respecting petitionerÊs claim that the money in his bank
accounts is not the „subject matter of the litigation,‰ the
meaning of the phrase „subject matter of the litigation‰ as
used in R.A. 1405 is explained 9
in Union Bank of the
Philippines v. Court of Appeals, thus:
„Petitioner contends that the Court of Appeals confuses the „cause

of action‰ with the „subject of the action.‰ In Yusingco v. Ong Hing
Lian, petitioner points out, this Court distinguished the two
concepts.
x x x „The cause of action is the legal wrong threatened or committed,

while the object of the action is to prevent or redress the wrong by
obtaining some legal relief; but the subject of the action is neither of
these since it is not the wrong or the relief demanded, the subject of the
action is the matter or thing with respect to which the controversy has

arisen, concerning
_______________
8 Philippine National Bank v. Gancayco, supra at note 7.

9 378 Phil. 1177, 1182-1183; 321 SCRA 563, 568-569 (1999).
215
VOL. 509, NOVEMBER 30, 2006 215

which the wrong has been done, and this ordinarily is the property or the
contract and its subject matter, or the thing in dispute.‰
The argument is well-taken. We note with approval the

difference between the Âsubject of the actionÊ from the Âcause of
action.Ê We also find petitionerÊs definition of the phrase Âsubject
matter of the actionÊ is consistent with the term Âsubject matter of
the litigationÊ, as the latter is used in the Bank Deposits Secrecy
Act.
In Mellon Bank, N.A. v. Magsino, where the petitioner bank
inadvertently caused the transfer of the amount of US$1,000,000.00
instead of only US$1,000.00, the Court sanctioned the examina
tion of the bank accounts where part of the money was subse
quently caused to be deposited:
Âx x x Section 2 of [Republic Act No. 1405] allows the disclosure of bank

deposits in cases where the money deposited is the subject matter of the
litigation. Inasmuch as Civil Case No. 26899 is aimed at recovering
the amount converted by the Javiers for their own benefit,
necessarily, an inquiry into the whereabouts of the illegally
acquired amount extends to whatever is concealed by being held
or recorded in the name of persons other than the one responsible
for the illegal acquisition.‰
Clearly, Mellon Bank involved a case where the money deposited

was the subject matter of the litigation since the money deposited
was the very thing in dispute. x x x‰ (Emphasis and italics supplied)
The plunder case now pending with the Sandiganbayan

necessarily involves an inquiry into the whereabouts of the
amount purportedly acquired illegally by former President
Joseph Estrada.

In light then of this CourtÊs pronouncement in Union

Bank, the subject matter of the litigation cannot be limited
to bank accounts under the name of President Estrada
alone, but must include those accounts to which the money
purportedly acquired illegally or a portion thereof was
alleged to have been transferred. Trust Account No. 858
and Savings Account No. 0116-17345-9 in the name of
petitioner fall under this
216

description and must thus be part of the subject matter of

the litigation.
In a further attempt to show that the subpoenas issued
by the Sandiganbayan are invalid and may not be enforced,
petitioner contends, as earlier stated, that the information
found therein, given their „extremely detailed‰ character,
could only have been obtained by the Special Prosecution
Panel through an illegal disclosure by the bank officials
concerned. Petitioner thus claims that, following the „fruit
of the poisonous tree‰ doctrine, the subpoenas must be
quashed.
Petitioner further contends that even if, as claimed by
respondent People, the „extremely-detailed‰ information
was obtained by the Ombudsman from the bank officials
concerned during a previous investigation of the charges
against President Estrada, such inquiry into his bank
accounts would itself be illegal. 10
Petitioner relies on Marquez v. Desierto where the
Court held:
„We rule that before an in camera inspection may be allowed there

must be a pending case before a court of competent jurisdiction.
Further, the account must be clearly identified, the inspection
limited to the subject matter of the pending case before the court of
competent jurisdiction. The bank personnel and the account holder
must be notified to be present during the inspection, and such
inspection may cover only the account identified in the pending
case.‰ (Italics supplied)

As no plunder case against then President Estrada had yet

been filed before a court of competent jurisdiction at the
time the Ombudsman conducted an investigation,
petitioner concludes that the information about his bank
accounts were acquired illegally, hence, it may not be
lawfully used to facilitate a subsequent inquiry into the
same bank accounts.
_______________
10 412 Phil. 387, 397; 359 SCRA 772, 781 (2001).
217
VOL. 509, NOVEMBER 30, 2006 217

PetitionerÊs attempt to make the exclusionary rule

applicable to the instant case fails. R.A. 1405, it bears
noting, nowhere provides that an unlawful examination of
bank accounts shall render the evidence obtained
therefrom inadmissible in evidence. Section 5 of R.A. 1405
only states that „[a]ny violation of this law will subject the
offender upon conviction, to an imprisonment of not more
than five years or a fine of not more than twenty thousand
pesos or both, in the discretion of11the court.‰
The case of U.S. v. Frazin, involving the Right to
Financial Privacy Act of 1978 (RFPA) of the United States,
is instructive.
„Because the statute, when properly construed, excludes a

suppression remedy, it would not be appropriate for us to provide
one in the exercise of our supervisory powers over the
administration of justice. Where Congress has both established a
right and provided exclusive remedies for its violation, we would
„encroach upon the prerogatives‰ of Congress were we to authorize
a remedy not provided for by statute. United States v. Chanen, 549
F.2d 1306, 1313 (9th Cir.), cert. denied, 434 U.S. 825, 98 S.Ct. 72, 54
L.Ed.2d 83 (1977).‰
12
The same principle was reiterated in U.S. v. Thompson:
„x x x When Congress specifically designates a remedy for one of its

acts, courts generally presume that it engaged in the necessary

balancing of interests in determining what the appropriate penalty
should be. See Michaelian, 803 F.2d at 1049 (citing cases); Frazin,
780 F.2d at 1466. Absent a specific reference to an exclusionary
rule, it is not appropriate for the courts to read such a provision into
the act.‰
Even assuming arguendo, however, that the exclusionary

rule applies in principle to cases involving R.A. 1405, the
_______________
11 780 F.2d 1461 (1986).

12 936 F.2d 1249 (1991).
218

Court finds no reason to apply the same in this particular

case. 13
Clearly, the „fruit of the poisonous tree‰ doctrine
presupposes a violation of law. If there was no violation of
R.A. 1405 in the instant case, then there would be no
„poisonous tree‰ to begin with, and, thus, no reason to
apply the doctrine.
How the Ombudsman conducted his inquiry into the
bank accounts of petitioner is recounted by respondent
People of the Philippines, viz.:
„x x x [A]s early as February 8, 2001, long before the issuance of

the Marquez ruling, the Office of the Ombudsman, acting under
the powers granted to it by the Constitution and R.A. No. 6770, and
acting on information obtained from various sources, including
impeachment (of then Pres. Joseph Estrada) related reports,
articles and investigative journals, issued a Subpoena Duces Tecum
addressed to Urban Bank. (Attachment „1-b‰) It should be noted
that the description of the documents sought to be produced at that
time included that of numbered accounts 727, 737, 747, 757, 777
and 858 and included such names as Jose Velarde, Joseph E.
Estrada, Laarni Enriquez, Guia Gomez, Joy Melendrez, Peachy

Osorio, Rowena Lopez, Kevin or Kelvin Garcia. The subpoena did

not single out account 858.
xxxx
Thus, on February 13, 2001, PDIC, as receiver of Urban Bank,
issued a certification as to the availability of bank documents
relating to A/C 858 and T/A 858 and the non-availability of bank
records as to the other accounts named in the subpoena.
(Attachments „2,‰ „2-1‰ and „2-b)
Based on the certification issued by PDIC, the Office of the
Ombudsman on February 16, 2001 again issued a Subpoena Duces
Tecum directed to Ms. Corazon dela Paz, as Interim Receiver, direct-
_______________
13 „According to this rule, once the primary source (the „tree‰) is shown to
have been unlawfully obtained, any secondary or derivative evidence (the
„fruit‰) derived from it is also inadmissible.‰ [People v. Alicando, 321 Phil. 656,
690; 251 SCRA 293, 314 (1995)].
219
VOL. 509, NOVEMBER 30, 2006 219

ing the production of documents pertinent to account A/C 858 and

T/C 858. (Attachment „3‰)
In compliance with the said subpoena dated February 16, 2001,
Ms. Dela Paz, as interim receiver, furnished the Office of the
Ombudsman certified copies of documents under cover latter dated
February 21, 2001:
1. Transaction registers dated 7-02-99, 8-16-99, 9-17-99, 10-18-99,

11-22-99, 1-07-00, 04-03-00 and 04-24-00;
2. Report of Unregularized TAFs & TDs for UR COIN A & B
Placements of Various Branches as of February 29, 2000 and as of
December 16, 1999; and
3. Trading Orders Nos. A No. 78102 and A No. 078125.
Trading Order A No. 07125 is filed in two copies·a white copy which
showed „set up‰ information; and a yellow copy which showed „reversal‰
information. Both copies have been reproduced and are enclosed with
this letter.

We are continuing our search for other records and documents

pertinent to your request and we will forward to you on Friday, 23
February 2001, such additional records and documents as we might find
until then. (Attachment „4‰)
The Office of the Ombudsman then requested for the mangerÊs

(sic) checks, detailed in the Subpoena Duces Tecum dated March 7,
2001. (Attachment „5‰)
PDIC again complied with the said Subpoena Duces Tecum dated
March 7, 2001 and provided copies of the managerÊs checks thus
requested under cover letter dated March 16, 2001. (Attachment
14
„6‰) (Emphasis in the original)
The Sandiganbayan 15
credited the foregoing account of
respondent People. The Court finds no reason to disturb
this finding of fact by the Sandiganbayan.
_______________
14 Rollo, pp. 439-442.

15 „As clarified by the prosecution, the documents listed in the request
were obtained in February 2001, pursuant to the power conferred on the
Ombudsman under Section 15(8) of R.A. 6770, long before the Supreme
Court promulgated the Marquez v. Desierto
220

The Marquez ruling notwithstanding, the above-described

examination by the Ombudsman of petitionerÊs bank
accounts, conducted before a case was filed with a court of
competent jurisdiction, was lawful.
For the Ombudsman issued the subpoenas bearing on
the bank accounts of petitioner about four months before
Marquez was promulgated on June 27, 2001.
While judicial interpretations of statutes, such as that
made in Marquez with respect to R.A. No. 6770 or the
Ombudsman Act of 1989, are deemed part of the statute as
of the date it was originally passed, the rule is16not absolute.
Columbia Pictures, Inc. v. Court of Appeals teaches:

„It is consequently clear that a judicial interpretation becomes a

part of the law as of the date that law was originally passed,
subject only to the qualification that when a doctrine of this
Court is overruled and a different view is adopted, and more
so when there is a reversal thereof, the new doctrine should
be applied prospectively and should not apply to parties who
relied on the old doctrine and acted in good faith.‰ (Emphasis and
italics supplied)
When this Court construed the Ombudsman Act of 1989, in

light of the Secrecy of Bank Deposits Law in Marquez, that
„before an in camera inspection may be allowed there must
be a pending case before a court of competent jurisdiction,‰
it was, in fact, reversing an earlier doctrine found17in Banco
Filipino Savings and Mortgage Bank v. Purisima.
Banco Filipino involved subpoenas duces tecum issued
by the Office of the Ombudsman, then known as the
Tanodba-
_______________
case.‰ (Sandiganbayan Resolution dated February 7, 2003, Rollo, p.

72)
16 G.R. No. 110318, August 28, 1996, 261 SCRA 144, 168.
17 G.R. No. L-56429. May 28, 1988, 161 SCRA 576.
221
VOL. 509, NOVEMBER 30, 2006 221

18
yan, in the course of its preliminary investigation of a
charge of violation of the Anti-Graft and Corrupt Practices
Act.
While the main issue in Banco Filipino was whether
R.A. 1405 precluded the TanodbayanÊs issuance of subpoena
duces tecum of bank records in the name of persons other
than 19the one who was charged, this Court, citing P.D.
1630, Section 10, the relevant part of which states:
(d) He may issue a subpoena to compel any person to appear, give

sworn testimony, or produce documentary or other evidence the

Tanodbayan deems relevant to a matter under his inquiry,
held that „The power of the Tanodbayan to issue

subpoenae ad testificandum and subpoenae duces
tecum at the time in question is not 20
disputed, and at
any rate does not admit of doubt.‰
As the subpoenas subject of Banco Filipino were issued
during a preliminary investigation, in effect this Court
upheld the power of the Tandobayan under P.D. 1630 to
issue subpoenas duces tecum for bank documents prior to
the filing of a case before a court of competent jurisdiction.
Marquez, on the other hand, practically reversed this
ruling in Banco Filipino despite the fact that the subpoena
power of the Ombudsman under R.A. 6770 was essentially
the same as that under P.D. 1630. Thus Section 15 of R.A.
6770 empowers the Office of the Ombudsman to
_______________
18 Section 2 of P.D. 1630 entitled „FURTHER REVISING

PRESIDENTIAL DECREE NO. 1487, AS REVISED BY
PRESIDENTIAL DECREE NO. 1607, CREATING THE OFFICE OF
THE TANODBAYAN‰ states: „An independent Office of the Ombudsman,
to be called the Office of the Tanodbayan, is hereby created. The Chief of
said Office of the Tanodbayan shall be called the Tanodbayan who shall
have two (2) deputies for Luzon, one for the Visayas and one for
Mindanao.‰ (Italics supplied)
19 Vide note 18.
20 Supra at p. 582.
222

(8) Administer oaths, issue subpoena and subpoena duces tecum,

and take testimony in any investigation or inquiry, including the
power to examine and have access to bank accounts and records;
A comparison of this provision with its counterpart in Sec.

10(d) of P.D. 1630 clearly shows that it is only more explicit
in stating that the power of the Ombudsman includes the

power to examine and have access to bank accounts and

records which power was recognized with respect to the
Tanodbayan through Banco Filipino.
The Marquez ruling that there must be a pending case
in order for the Ombudsman to validly inspect bank
21
records
in camera thus reversed a prevailing doctrine. Hence, it
may not be retroactively applied.
The OmbudsmanÊs inquiry into the subject bank
accounts prior to the filing of any case before a court of
competent jurisdiction was therefore valid at the time it
was conducted.
Likewise, the Marquez ruling that „the account holder
must be notified to be present during the inspection‰ may
not be applied retroactively to the inquiry of the
Ombudsman subject of this case. This ruling is not a
judicial interpretation either of R.A. 6770 or R.A. 1405, but
22
a „judge-made‰ law which, as People v. Luvendino
instructs, can only be given prospective application:
_______________
21 Vide RAFAEL A. MORALES, THE PHILIPPINE GENERAL

BANKING LAW (ANNOTATED), 2nd ed. (2004), page 145: „It used to be
believed too that the Secrecy of Bank Deposits Law did not apply to the
Ombudsman, on account of his authority, under Section 15(8) of the
Ombudsman Act of 1989 (Republic Act No. 6770), to Âexamine and have
access to bank accounts and records.Ê However, the Supreme Court in
Marquez vs. Hon. Aniano A. Desierto, et al., G.R. No. 135882, June 27,
2001, 359 SCRA 772 restricted the OmbudsmanÊs power x x x.‰ (Italics
supplied)
22 G.R. No. 69971, July 3, 1992, 211 SCRA 36, 49-50, reiterated in
Filoteo v. Sandiganbayan, 331 Phil. 531, 573; 263 SCRA 222, 259-260
(1996).
223
VOL. 509, NOVEMBER 30, 2006 223

„x x x The doctrine that an uncounselled waiver of the right

to counsel is not to be given legal effect was initially a judge-
made one and was first announced on 26 April 1983 in

Morales v. Enrile and reiterated on 20 March 1985 in People

v. Galit. x x x
While the Morales-Galit doctrine eventually became part of
Section 12(1) of the 1987 Constitution, that doctrine affords no
comfort to appellant Luvendino for the requirements and
restrictions outlined in Morales and Galit have no
retroactive effect and do not reach waivers made prior to 26
April 1983 the date of promulgation of Morales. (Emphasis
supplied)
In fine, the subpoenas issued by the Ombudsman in this

case were legal, hence, invocation of the „fruit of the
poisonous tree‰ doctrine is misplaced.
AT ALL EVENTS, even if the challenged subpoenas are
quashed, the Ombudsman is not barred from requiring the
production of the same documents based solely on
information obtained by it from sources independent of its
previous inquiry.
In particular, the Ombudsman, even before its inquiry,
had already possessed information giving him grounds to
believe that (1) there are bank accounts bearing the
number „858,‰ (2) that such accounts are in the custody of
Urban Bank, and (3) that the same are linked with the
bank accounts of former President Joseph Estrada who was
then under investigation for plunder.
Only with such prior independent information could it
have been possible for the Ombudsman to issue the
February 8, 2001 subpoena duces tecum addressed to the
President and/or Chief Executive Officer of Urban Bank,
which described the documents subject thereof as follows:
(a) bank records and all documents relative thereto pertaining

to all bank accounts (Savings, Current, Time Deposit, Trust,
Foreign Currency Deposits, etc⁄) under the account names of
Jose Velarde, Joseph E. Estrada, Laarni Enriquez, Guia Gomez, Joy
224

Melendrez, Peach Osorio, Rowena Lopez, Kevin or Kelvin Garcia,

727, 737, 747, 757, 777 and 858.‰ (Emphasis and italics supplied)

The information on the existence of Bank Accounts bearing

number „858‰ was, according to respondent People of the
Philippines, obtained from various sources including the
proceedings during the impeachment of President Estrada,
23
related reports, articles and investigative journals. In the
absence of proof to the contrary, this explanation proffered
by respondent must be upheld. To presume that the
information was obtained in violation of R.A. 1405 would
infringe the presumption of regularity in the performance
of official functions.
Thus, with the filing of the plunder case against former
President Estrada before the Sandiganbayan, the
Ombudsman, using the above independent information,
may now proceed to conduct the same investigation it
earlier conducted, through which it can eventually obtain
the same information previously disclosed to it by the
PDIC, for it is an inescapable fact that the bank records of
petitioner are no longer protected by R.A. 1405 for the
reasons already explained above.
Since conducting such an inquiry would, however, only
result in the disclosure of the same documents to the
Ombudsman, this Court, in avoidance of what would be 24 a
time-wasteful and circuitous way of administering justice,
upholds the challenged subpoenas.
Respecting petitionerÊs claim that the Sandiganbayan
violated his right to due process as he was neither notified
of the requests for the issuance of the subpoenas nor of the
grant thereof, suffice it to state that the defects were cured
when
_______________
23 Rollo, p. 439.
24 Amunategue Vda. de Gentugao v. Court of Appeals (G.R. No. L-
30340. June 30, 1976, 71 SCRA 565, 574); vide Ortigas and Co. Ltd.
Partnership v. Velasco (G.R. No. 109645, July 25, 1994, 234 SCRA 455,
501).
225
VOL. 509, NOVEMBER 30, 2006 225


petitioner ventilated his arguments against the issuance

thereof through his earlier quoted letter addressed to the
Sandiganbayan and when he filed his motions to quash
before the Sandiganbayan.
IN SUM, the Court finds that the Sandiganbayan did
not commit grave abuse of discretion in issuing the
challenged subpoenas for documents pertaining to
petitionerÊs Trust Account No. 858 and Savings Account
No. 0116-17345-9 for the following reasons:
1. These accounts are no longer protected by the

Secrecy of Bank Deposits Law, there being two
exceptions to the said law applicable in this case,
namely: (1) the examination of bank accounts is
upon order of a competent court in cases of bribery
or dereliction of duty of public officials, and (2) the
money deposited or invested is the subject matter of
the litigation. Exception (1) applies since the
plunder case pending against former President
Estrada is analogous to bribery or dereliction of
duty, while exception (2) applies because the money
deposited in petitionerÊs bank accounts is said to
form part of the subject matter of the same plunder
case.
2. The „fruit of the poisonous tree‰ principle, which
states that once the primary source (the „tree‰) is
shown to have been unlawfully obtained, any
secondary or derivative evidence (the „fruit‰)
derived from it is also inadmissible, does not apply
in this case. In the first place, R.A. 1405 does not
provide for the application of this rule. Moreover,
there is no basis for applying the same in this case
since the primary source for the detailed
information regarding petitionerÊs bank accounts·
the investigation previously conducted by the
Ombudsman·was lawful.
3. At all events, even if the subpoenas issued by the
Sandiganbayan were quashed, the Ombudsman
may conduct on its own the same inquiry into the
subject bank accounts that it earlier conducted last
February-March 2001, there being a plunder case
already pending against former President Estrada.

To quash the challenged subpoenas would,
226

therefore, be pointless since the Ombudsman may obtain

thesame documents by another route. Upholding the
subpoenasavoids an unnecessary delay in the
administration of justice.
WHEREFORE, the petition is DISMISSED. The
Sandiganbayan Resolutions dated February 7 and 12, 2003
and March 11, 2003 are upheld.
The Sandiganbayan is hereby directed, consistent with
this CourtÊs ruling in Marquez v. Desierto, to notify
petitioner as to the date the subject bank documents shall
be presented in court by the persons subpoenaed.
SO ORDERED.
Panganiban (C.J.), Puno, Quisumbing, Austria-

Martinez, Corona, Tinga and Velasco, Jr., JJ., concur.
Ynares-Santiago, J., I join dissenting opinion of J.
Angelina Gutierrez.
Sandoval-Gutierrez, J., Pls. see my Dissent.
Carpio, J., No Part·prior inhibition.
Callejo, Sr., J., Pls. see my Concurring Opinion.
Azcuna, J., I take no part·my former law office
acted as counsel for a party.
Chico-Nazario, J., No Part.
Garcia, J., I join the dissenting opinion of J.
Gutierrez.
DISSENTING OPINION
SANDOVAL-GUTIERREZ, J.:
I regret I cannot give my assent to the ponencia of Madame

Justice Conchita Carpio-Morales. To my mind, no member
of a democratic society can honestly argue that there is

nothing wrong in an examination of a bank account to the

complete ignorance of its holder. This is the kind of conduct
referred to
227
VOL. 509, NOVEMBER 30, 2006 227

1
in Rochin v. California, as one that „shocks the conscience,‰
„one that is bound to offend hardened sensibilities.‰ This
abusive conduct must be stricken if we are to maintain
decency, fair play, and fairness in our judicial system.
Nothing can destroy a government more quickly than its
failure to observe its own laws, its disregard of the
character of its own existence. The government should not
demean but protect the Bill of Rights, because the highest
function of authority is to exalt liberty. Here, petitioner
Joseph Victor G. EjercitoÊs right to privacy has been
violated. I cannot, in my conscience, tolerate such violation.
Zones
2
of privacy are recognized and protected by our
laws. Within these zones, any form of intrusion is
impermissible unless excused by law and in accordance
with customary legal process. The meticulous regard this
Court accord to these zones arises not only from the
conviction that the right to privacy is a „constitutional3
right‰ and „the right most valued by civilized men,‰ but
also from our adherence to the Universal Declaration of
Human Rights which mandates that „no one shall be
subjected to arbitrary interference with his privacy‰ and
„everyone has the right to the 4
protection of the law against
such interference or attacks.‰
For easy reference, a narration of the factual and legal
antecedents is imperative.
This petition for certiorari under Rule 65 of the 1997
Rules of Civil Procedure, as amended, seeks to annul and
set
5
aside Sandiganbayan (a) Resolutions, dated February
7 and Feb-
_______________
1 342 U.S. 165 (1952), p. 172.

2 Marquez v. Desierto, G.R. No. 135882, June 27, 2001, 359 SCRA 772.
3 See Morfe v. Mutuc, No. L-20387, January 31, 1968, 22 SCRA 424.
4 Article 12 of the Universal Declaration of Human Rights. See also
Article 17 (1) and (2) of the International Covenant on Civil and Political
Rights.
5 Annex „A‰ of the Petition, Rollo, p. 64.
228

6
ruary 12, 2003, denying Joseph Victor G. EjercitoÊs two
succeeding motions to quash three (3) subpoenae duces
tecum/ad 7
testificandum; and (b) Resolution dated March
11, 2003 denying his motion for reconsideration all issued
in Criminal Case No. 26558 for plunder against former
President Joseph Ejercito Estrada, et al.
Joseph Victor G. Ejercito (petitioner herein) is the holder
of two (2) bank accounts with the Urban Bank and
Urbancorp Investment, Inc., now Export and Industry
Bank (EIB);one is Trust Account No. 858 and the other is
Savings Account No. 0116-17345-9.
On January 26, 2003, petitioner learned from the media
that the
8
Special Prosecution Panel in Criminal Case No.
26558, entitled „People vs. Joseph Ejercito Estrada, et al.‰
for plunder, pending before the Sandiganbayan
(respondent herein), had requested the said court to issue
subpoenae duces tecum/ad testificandum to the EIB for the
production and examination of his two (2) bank accounts.
Alarmed, petitioner attended the hearing of the plunder
case set the next day and submitted to respondent
Sandiganbayan a letter expressing his deep concern on his
bank accounts being the subject of a „subpoena duces
tecum/ad testificandum.‰ He also requested that he be
given time to retain the services of a lawyer, thus:
„Your Honors:
It is with much respect that I write this court relative to the
concern of subpoenaing the undersignedÊs bank account which I
have learned through the media.

_______________
6 Annex „B‰ of the Petition, id., p. 74.

7 Annex „C‰ of the Petition, id., p. 76.
8 It appears that petitionerÊs subpoenaed bank accounts were also
presented and testified to by prosecution witnesses in Criminal Case
No. 26565 for illegal use of alias against Former President Estrada.
229
VOL. 509, NOVEMBER 30, 2006 229

I am sure the prosecution is aware of our banking secrecy

laws everyone supposed to observe. But, instead of prosecuting
those who may have breached such laws, it seems it is even going to
use supposed evidence which I have reason to believe could only
have been illegally obtained.
The prosecution was not content with a general request. It even
lists and identifies specific documents meaning someone
else in the bank illegally released confidential information.
If this can be done to me, it can happen to anyone. Not that
anything can still shock our family. Nor that I have anything to
hide. Your Honors.
But, I am not a lawyer and need time to consult one on a
situation that affects every bank depositor in the country
and should interest the bank itself, the Bangko Sentral ng
Pilipinas, and maybe the Ombudsman himself, who may
want to investigate, not exploit, the serious breach that can
only harm the economy, a consequence that may have been
overlooked. There appears to have been deplorable
connivance
xxx xxx
I hope and pray, Your Honors, that I will be given time to
retain the services of a lawyer to help me protect my rights
and those of every banking depositor. But the one I have in
mind is out of the country right now.
May I, therefore, ask your Honors, that in the meantime,
the issuance of the subpoena be held in abeyance for at least
ten (10) days to enable me to take appropriate legal steps in
connection with the prosecutionÊs request for the issuance
9
of subpoena concerning my accounts.‰ (Emphasis supplied)

To petitionerÊs surprise, respondent Sandiganbayan

advised him „to file a motion to quash‰ not later than 12:00
noon of January 28, 2003, or the following day. It dawned
upon petitioner that respondent court had already
issued a „subpoenaduces tecum/ad testificandum.‰
_______________
9 Annex „D‰ of the Petition, Rollo, p. 81.
230

Upon verification of the records, petitioner found that the

Special Prosecution Panel had filed with respondent
Sandiganbayan two (2) requests for the issuance of
subpoenae duces
10
tecum/ad testificandum,11
one dated
January 20 and the other January 23, 2003 for the
EIB President or his authorized representative to appear
and testify on certain dates and to bring the original or
certified true copies of the following documents:
I. For Trust Account No. 858:

2. Trading Order No. 020385, dated January 29, 1999;
4. Original/Microfilm copies, including the dorsal side
of the following:
a) Bank of Commerce MC#0256254 in the amount
of P2,000,000.00;
b) Urban Bank Corp. MC# 34181 dated November
8, 1999 in the amount of P10,875,749.43;
c) Urban Bank MC# 34182 dated November 8,
1999 in the amount of P42,716,554.22;
d) Urban Bank Corp. MC#37661 dated November
23, 1999 in the amount of P54,161,496.52;
5. Trust Agreement dated January 1999;

Trustee: Joseph Victor G. Ejercito

6. Ledger of the Span #858
SPAN # 858
_______________
10 Annex „E‰ of the Petition, id., pp. 82-84. For the hearing dated
January 22 and 27, 2003.
11 Annex „F‰ of the Petition, id., pp. 86-88. For the hearing dated
January 27 and 29, 2003.
231
VOL. 509, NOVEMBER 30, 2006 231

1. Signature Cards; and

2. Statement of Account/Ledger
III. Urban Bank ManagerÊs Checks and their
corresponding Urban Bank ManagerÊs Checks
Application Form, as follows:
1. MC # 039975 dated January 18, 2000 in the
amount of P70,000,000.00;
amount of P2,000,000.00;
amount of P2,000,000.00; and
4. MC# 039978 dated January 18, 2000 in the
amount of P1,000,000.00;
Petitioner also came to12know that respondent court had

granted both requests and issued the corresponding
subpoenae
13
duces
14
tecum/ad testificandum dated January
21 and 24, 2003.
Immediately, or on January 29, 2003, petitioner filed a

15
motion to quash the two (2) subpoenae.
Meanwhile, on January 31, 2003, the Special
Prosecution Panel filed another request for the issuance of
a subpoena duces tecum/ad
16
testificandum pertaining to the
same documents. On the same day, respondent
Sandiganbayan granted the request and issued the
corresponding 17 subpoena. Again, petitioner filed a
motion to quash.
_______________
12 See Resolution dated January 21, 2003, Annex „G‰ of the Petition,
id., p. 90.
13 Attachment „9‰ of the Comment, id., p. 489.
15 Annex „H‰ of the Petition, id., pp. 91-96. PetitionerÊs motion to
quash erroneously stated that the subpoenae duces tecum/ad
testificandum were issued both on January 24, 2003.
16 Annex „I‰ of the Petition, id., pp. 97-99.
17 Annex „O‰ of the Petition, id. pp.170-174.
232

In both motions to quash, petitioner bewailed the

„extremely-detailed‰ information contained in the Special
Prosecution PanelÊs requests, alleging that a prior illegal
disclosure of his bank accounts took place.
During the exchange of pleadings, petitioner learned
that there was indeed a prior disclosure of his bank
accounts. In fact, as early as February 8, 2001, the Office of
the Ombudsman had issued a subpoena duces tecum
addressed to the „President or Chief Executive Officer
of Urban Bank‰ requiring him to produce „bank records
and all documents relative thereto pertaining to all
bank accounts (Savings, Current, Time Deposit,
Trust, Foreign Currency Deposits, etc⁄) under the
account names of Jose Velarde, Joseph E. Estrada,
Laarni Enriquez, Guia Gomez, Joy Melendrez,

Peachy Osorio, Rowena Lopez,18 Kevin or Kelvin

Garcia, 727, 737, 747, 757 and 858.‰
On February 13, 2001, the Philippine Deposit Insurance
Corporation (PDIC), as receiver of Urban Bank, responded
to the subpoena and certified the availability of bank
documents relating to „T/A 858 and A/C 858‰ and the
nonavailability of bank records as to the other accounts,
thus:
„We certify that from the gathering and research we have conducted
to date into the records of the closed Urban Bank under the custody
and control of the Philippine Deposit Insurance Corporation (PDIC),
as Receiver of said bank, the documents enumerated in the
attached list refer to „A/C 858‰ and „T/A 858.‰
We further certify that Accounts „A/C 858‰ and „T/A 858‰ do not
appear in the Registry of Deposits of Urban Bank and therefore
19
said accounts are not part of the deposit liabilities of said bank.‰
Based on the foregoing certification, the Office of the

Ombudsman again issued a subpoena duces tecum dated
February 16, 2001 directing the production of documents
pertinent
_______________

19 Attachment „2-a‰ of the Comment, id., p. 470.
233
VOL. 509, NOVEMBER 30, 2006 233

20
to accounts „T/C 858 and A/C 858.‰ In compliance, the
PDIC furnished the Office of the Ombudsman certified
copies of the following documents:
1. Transaction registers dated 7-02-99, 8-16-99, 9-17-99, 1018-

99, 11-22-99, 1-07-00, 01-17-00, 04-03-00 and 04-24-00;
2. Report of Unregularized TAF & DTS For UR COIN A & B
Placements of Various Branches as of February 29, 2000
and as of December 16, 1999; and

Trading Order A No. 07125 is filed in two copies – a white copy

which showed „set up‰ information; and a yellow copy which showed
„reversal‰ information. Both copies have been reproduced and are
21
enclosed with this letter.
The Office
22
of the Ombudsman, in another subpoena duces
tecum dated March 7, 2001, directed the production of
ManagerÊs/CashierÊs Checks in the following amounts:
a. P10,875,749.43 dated November 8, 1999

b. P 2,000,000.00 dated January 18, 2000
c. P 2,000,000.00 dated January 18, 2000
d. P 1,000,000.00 dated January 18, 2000
23
e. P70,000,000.00 dated January 18, 2000
The PDIC complied with the said subpoena.

On the basis of the foregoing documents released by the
PDIC to the Office of the Ombudsman, the Special
Prosecution Panel filed with respondent Sandiganbayan its
own requests for the issuance of subpoenae duces tecum/ad
testificandum.
_______________

23 See Attachment „6‰ of the Comment, id., p. 481.
234

On February 7, 2003, respondent Sandiganbayan denied

petitionerÊs motion to quash subpoenae duces24
tecum/ad
testificandum dated January 21 and 24, 2003. Thus:
„At the threshold, we state that we are not in accord with the stand
of the prosecution that a trust account is not included in the term

„deposit of whatever nature.‰ A „bank deposit‰ is defined as a

contractual relationship ensuing from the delivery, by one known as
the depositor of money, funds or even things into the possession of
the bank, which receives the same upon the agreement to pay,
repay or return, upon the order or demand of the depositor, the
money, funds, or equivalent amount. This agreement on the part of
the bank is usually a tacit one and implied, and it may include an
implied promise to pay interest upon the deposit, depending upon
the nature of the deposit and the account into which it is placed (10
Am Jur 2d Banks 337, cited in page 121, BallentineÊs Law
Dictionary, Third Edition). x x x The Court is inclined to adopt the
broader or expanded definition of the word „deposit‰ in R.A. 1405 as
to encompass trust accounts consistently with the state policy
declared in Section 1 thereof which is „to give encouragement to the
people to deposit their money in banking institution and to
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.‰ In fact, the law itself adverts to
„deposit of whatever nature.‰
xxx xxx
The Bank Secrecy Laws which prohibit the disclosure of or
inquiry into deposits with any banking institution provides for
exceptions as follows:
xxx xxx
3.Upon order of a competent court in cases of (a) bribery or dereliction
of duty or (b)where the money deposited or invested is the subject matter
of litigation;
xxx xxx
_______________
24 Annex „H‰ of the Petition, at pp. 91-96. PetitionerÊs motion to quash

erroneously stated that the subpoenaeduces tecum/ad testificandum
were both issued on January 24, 2003.
235
VOL. 509, NOVEMBER 30, 2006 235

We now agree with the prosecution that the issuance of the

subpoena to Export and Industry bank (formerly Urban

Bank) and PDIC falls under the exception. The questioned
subpoena was issued by this Court in relation to the instant
cases against former President Joseph Estrada for Plunder
and Illegal Use of Alias. The case for plunder which involves
betrayal of public trust, undeniably, is analogous to the
cases enumerated by law for the exception to apply. As
expressed by the Supreme Court in the cases of Philippine National
Bank v. Gancayco(ibid.) and Philippine National Bank v. Dionisio
(9 SCRA 10), „cases of unexplained wealth are similar to cases of
bribery or dereliction of duty and no reason is seen why these two
classes of cases cannot be excepted from the rule making bank
deposits confidential. The policy as to one cannot be different as to
the other. This policy expresses the notion that a public office is a
public trust and any person who enters upon its discharge does so
with the full knowledge that his life, so far as relevant to his duty, is
open to public scrutiny.‰ x x x
xxx xxx
Further, movantÊs claim that the subpoena must be quashed in
view of the apparent conspiracy between the prosecution panel,
officials of Export and Industry Bank, and Ms. Aurora Baldoz of the
Philippine Deposit Insurance Corporation as revealed by the fact
that the prosecution panel knows the documents which are
supposedly very internal to the bank and its clients, deserves scant
consideration. Aside from it being not recognized as one of the
grounds to quash the subpoena, the mere fact that the request for
subpoena specified the documents which are to be brought to court,
cannot, by itself proved that there was conspiracy on the part of the
prosecution, the officials of Export and Industry Bank as well
as of the officials of the PDIC to violate the bank secrecy
law. As clarified by the prosecution, the documents listed in
the request were obtained in February, 2001, pursuant to the
power conferred on the Ombudsman under Section 15 (8) of R.A.
6770, long before the Supreme Court promulgated the
Marquez v. Desierto case. Conspicuously, since the
investigation was conducted in February, 2001, these cases
are already pending, hence, the Marquez ruling will not
likewise apply. Besides, as already discussed, we declare
that this case falls
236


under the exception of the aforecited law, hence, the premise on

which this argument proceeds, does not any more exist.
xxx xxx
x x x The allegation that movantÊs constitutional right to due
process was violated by the failure of the prosecution to give notice
to him and accused Estrada is devoid of merit. In the case of Adorio
v. Bersamin (273 SCRA 217), the Supreme Court ruled that:
ÂContrary to petitionerÊs allegations, there was nothing irregular in the

issuance of the subpoenas duces tecum. Requests by a party for the
issuance of subpoenas do not require notice to other parties to the action.
No violation of due process results by such lack of notice since the other
parties would have ample opportunity to examine the witnesses and
documents subpoenaed once they are presented in court.Ê ‰
OnFebruary 12, 2003, respondent Sandiganbayan likewise

denied petitionerÊs motion to quash subpoena duces
tecum/ad testificandum dated January 31, 2003.
Petitioner filed a motion for reconsideration but was
denied in the Resolution dated March 11, 2003.
Hence, the present petition for certiorari anchored on
the following arguments:
(1) Whether the inquiry by subpoenae into the

bank accounts of petitioner falls under the
exceptions provided for by R.A. No. 1405; and
(2) Whether petitioner should have been notified
by respondent court, by furnishing him copies
of the subpoenae, that his bank accounts are
subject of the litigation therein.
Petitioner maintains that the inquiry into his bank

accounts does not fall under the exceptions provided by
Republic Act No. 1405 (Secrecy of Bank Deposits Act),i.e.,
„upon order of a competent court in cases of bribery
or dereliction of duty of public officials, or in cases
where the money deposited or invested is the subject
matter of litigation.‰ He stresses that plunder is neither
bribery nor dereliction of duty and that his bank accounts
are not the „subject

237
VOL. 509, NOVEMBER 30, 2006 237

25
matter‰ of the plunder case. In this regard, he contends
that the rulings
26
of this Court in Philippine National Bank
v. Gancayco and27 Banco Filipino Savings and Mortgage
Bank v. Purisima are not applicable to the instant case.
Finally, he insists that the „extremely-detailed‰
information in the Special Prosecution PanelÊs requests for
subpoenae duces tecum/ad testificandum shows prior illegal
disclosure of his bank accounts, in violation of his
constitutional right to due process and privacy.
On the other hand, respondent People contends that
petitionerÊs bank deposits are actually proceeds of a „trust
account,‰ hence, subject of inquiry under R.A. No. 1405.
I find the petition impressed with merit.
The case at bar brings to fore R.A. No. 1405 or the
Secrecy of Bank Deposits Act. A glimpse at its history
provides an adequate backdrop for our ensuing discussion.
On September 9, 1955, the Philippine Legislature
enacted R.A. No. 1405. Its rationale is to discourage private
hoarding and encourage people to deposit money in banks
to be utilized in authorized loans. It happened that after
World War II, capital and credit facilities for agricultural
and industrial development in the country were lacking.
Rehabilitation of the banking system became a major
government thrust. However, private hoarding of money
was rampant because people feared government inquiry
into their bank deposits and bond investments for tax
collection purposes. Thus, even if the members of Congress
at that time recognized the possible
_______________
25 By the phrase „subject matter of the action‰ is meant the

physical facts, the thing real or personal, the money, lands,
chattels, and the like, in relation to which the suit is presented,
and not the delict or wrong committed by the defendant.‰ Union
Bank of the Philippines v. Court of Appeals, G.R. No. 134699, December

23, 1999, 321 SCRA 563, citing Mathay v. Consolidated Bank and Trust
Co., 58 SCRA 559 (1974).
26 No. L-18343, September 30, 1965, 15 SCRA 91.
27 No. L- 56429, May 28, 1988, 161 SCRA 576.
238

danger of R.A. No. 1405, such as providing a climate

conducive to tax evasion, still, they passed the law with the
belief that the benefits accruing to the economy with the
influx of deposits and bond investments would
counterbalance immeasurably the 28
losses of the
Government from such tax evasion. Section 2, the core of
R.A. No. 1405, then reads:
„Sec. 2. All deposits of whatever nature with banks or banking

institutions in the Philippines including investments in bonds
issued by the Government of the Philippines, its political
or office except upon written permission of the depositor, or
in cases of impeachment, or upon order of a competent
court in cases of bribery or dereliction of duty of public
officials, or in cases where the money deposited or invested
is the subject matter of the litigation.‰
In 1981, Former President Ferdinand E. Marcos issued

Presidential Decree (P.D.) No. 1792 to provide for
additional exceptions to the „absolutely confidential
nature‰ of bank deposits. These additional exceptions are:
(1) when the examination is made in the course of a special
or general examination of a bank; or (2) when the
examination is made by an independent auditor hired by
the bank to conduct its regular audit. Section 2 of R.A. No.
1405, as amended, thus reads:
SEC. 2. All deposits of whatever nature with banks or banking



or office, except, when the examination is made in the course
of a special or general examination of a bank and is
specifically authorized by the Monetary Board after being
satisfied that there is reasonable ground to believe that a
bank fraud or
_______________
28 Viray 1998.
239
VOL. 509, NOVEMBER 30, 2006 239

serious irregularity has been or is being committed and that

it is necessary to look into the deposit to establish such
fraud or irregularity, or when the examination is made by
an independent auditor hired by the bank to conduct its
regular audit provided that the examination is for audit
purposes only and the results thereof shall be for the
exclusive use of the bank, or upon written permission of the
depositor, or in case of impeachment, or upon order of a competent
matter of litigation.‰ (Emphasis supplied)
The foregoing amendment was premised on the realization

that the old provision adversely limited the examining
authority of the Central Bank. Allegedly, such limitation
was contrary to the effective supervision of banks and
endangered the safety of deposits.
However, in 1992, P.D. No. 1792 was expressly repealed
by Republic Act (R.A.) 29No. 7653, otherwise known as the
New Central Bank Act. Aside from encouraging domestic
savings, R.A. No. 7653 sought to uphold the right of
citizens to privacy. Also, the then members of Congress
were of the consensus that relaxed disclosure rules are not
conducive to healthy competition among banks and other
30
financial institutions.
Thus, we go back to the original provision of Section 2 of
R.A. No. 1405 allowing deposits to be „examined, inquired
or looked into‰ under the following exceptions: (1) upon
written permission of the depositor; (2) in cases of
impeachment; (3) upon order of a competent court in cases
of bribery or dereliction of duty of public officials; or (4) in
cases where the money 31deposited or invested is the subject
matter of the litigation.
_______________
29 Section 135.
30 Suratos and Sale, Jr. 1994.
31 Additional exceptions are provided in other laws, such as:
(a) Republic Act No. 3019 or the Anti-Graft and Corrupt Practices Act, where
bank deposits of a public officialÊs „spouse and unmarried children‰ maybe
„taken into considera
240

I shall now resolve both issues.
Inquiry Falls Under the Exceptions

to the Confidentiality Rule and, therefore,
may be Inquired into by Respondent Sandiganbayan.
Petitioner contends that plunder is neither bribery nor

dereliction of duty, hence, the inquiry on his bank accounts
cannot be considered an exception under R.A. No. 1405.
The argument is utterly without merit. 32
In the 1965 Philippine National Bank v. Gancayco
case, this Court held for the first time that the exception
„upon order of a competent court in cases of bribery or
dereliction of duty of public officials‰ is not exclusive, and
that analogous cases may be considered as falling within
the same exception. There, „cases of unexplained
wealth‰ were considered analogous to „cases of bribery or

dereliction of duty.‰ The CourtÊs instructive pronouncement

is quoted hereunder:
„With regard to the claim that disclosure would be contrary to the

policy making bank deposits confidential, it is enough to point out
that while section 2 of Republic Act 1405 declares bank deposits
_______________
tion‰ (Section 8) See also Philippine National Bank v. Gancayco, supra, and Banco Filipino
Savings and Mortgage Bank v. Purisima, supra;
(b) Republic Act No. 6770, the Ombudsman Act of 1990, where the Ombudsman is
authorized to „examine and have access to bank accounts and records‰ of government officers
and employees (Section 15 (8); and
(c) Republic Act No. 9160, the Anti-Money Laundering Law of 2001, where the Anti-Money
Laundering Council is allowed to examine deposit or investment with any banking institution
or non-bank financial institution upon order of any competent court, when it has been
established that there is probable cause that the deposits or investments are in any way
related to a money laundering offense (Section 11).
32 Supra.
241
VOL. 509, NOVEMBER 30, 2006 241

to be „absolutely confidential,‰ it nevertheless allows such

disclosure in the following instances: (1) Upon written permission
of the depositor; (2) In cases of impeachment; (3) Upon order of a
competent court in cases of bribery or dereliction of duty of
public officials; (4) In cases where the money deposited is the
subject matter of the litigation. Cases of unexplained wealth are
similar to cases of bribery or dereliction of duty and no
reason is seen why these two classes of cases cannot be
excepted from the rule making bank deposits confidential.
The policy as to one cannot be different from the policy as to
the other. This policy expresses the notion that a public
office is a public trust and any person who enters upon its
discharge does so with the full knowledge that his life, so far
as relevant to his duty, is open to public scrutiny.‰
Twenty-three (23) years thereafter, in 1988, the Court

echoed the same principle in the33 Banco Filipino Savings

and Mortgage Bank v. Purisima. Incidentally, both cases
involve Republic Act No. 3019, the Anti-Graft and Corrupt
Practices Act.
Today, this Court is faced with this important query·is
plunder analogous to bribery, dereliction of duty or cases of
unexplained wealth? I need not indulge in a lengthy
disquisition to show that plunder belongs to the same genre
of cases. Under Republic Act No. 7080, An Act Penalizing
the Crime of Plunder, this crime is committed by a public
officer who, by himself or in connivance with others,
amasses, accumulates or acquires ill-gotten wealth, the
aggregate amount or total value of which is at least Fifty
Million Pesos (P50,000,000.00), through a combination or
series of overt or criminal acts. The essence of plunder lies
in the phrase „combination or series of overt or
criminal acts.‰ Bribery and violations of R.A. No.
3019 are only some of the criminal acts that comprise
the more serious crime of plunder. In other
_______________
33 Supra.
242

34
words, these are some of the predicate crimes of plunder.
All the criminal acts are enumerated hereunder:
(1) Through misappropriation, conversion, misuse, or

treasury;
(2) By receiving, directly or indirectly, any commission,
gift, share, percentage, kickbacks, or any other form
of pecuniary benefit from any person and/or entity
in connection with any government contract or
project or by reason of the office or position of the
public officer concerned;
(3) By the illegal or fraudulent conveyance or

Government or any of its subdivision, agencies or
instrumentalities or government-owned or
_______________
34 Senator Paterno. I envision that this bill or this kind of plunder

would cover a discovered interconnection of certain acts,
particularly, violations of Anti-Graft and Corrupt Practices Act
when, after the different acts are looked at, a scheme of conspiracy can
be detected, such scheme or conspiracy consummated by the different
criminal acts or violations of Anti-Graft and Corrupt Practices
Act, such that the scheme or conspiracy becomes a sin, as a large scheme
to defraud the public or rob the public treasury. It is parang robo and
banda. It is considered as that. And, the bill seeks to define or says that
P100 million is that level ay which ay talagang sobra na dapat nang
parusahan ng husto. Would it be a correct interpretation or assessment
of the intent of the bill?
Senator Tañada. Yes, Mr. President. The fact that under existing law,
there can be only one offense charged in the information, that makes it
very cumbersome and difficult to go after these grafters if we would not
come out with this bill. That is what is happening now; because of that
rule that there can be only one offense charged per information, then we
are having difficulty in charging all the public officials who would seem
to have committed these corrupt practices. With this bill, we could
come out with just one information, and that would cover all the
series of criminal acts that may have been committed by him.
(Record of the Senate, June 5, 1989, Vol. IV, No. 140, p. 1315) See also
Record of the Senate, June 6, 1989, Vol. IV, No. 141, p. 1399.
243
VOL. 509, NOVEMBER 30, 2006 243

(4) By obtaining, receiving or accepting directly, or

form of interest or participation including the
promise of future employment in any business
enterprise or undertaking;

(5) By establishing agricultural, industrial or

commercial monopolies or other combinations
and/or implementation of decrees and orders
intended to benefit particular person or special
interests; or
(6) By taking undue advantage of official position,
authority, relationship, connection, or influence to
Filipino people and the Republic of the Philippines.
A reading of the 35
provisions of the Revised36Penal Code
concerning bribery and dereliction of duty, as well as
corrupt
_______________
35 Article 211. Indirect bribery.·The penalties of prision

correccional in its medium and maximum periods, suspension and public
censure shall be imposed upon any public officer who shall accept gifts
offered to him by reason of his office.
36 The following crimes fall under the heading „Dereliction of Duty‰:
Article 204. Knowingly rendering unjust judgment.·Any judge
who shall knowingly render an unjust judgment in any case submitted to
him for decision shall be punished by prision mayor and perpetual
absolute disqualification.
Article 205. Judgment rendered through negligence.·Any judge
who, by reason of inexcusable negligence or ignorance, shall render a
manifestly unjust judgment in any case submitted to him for decision
shall be punished by arresto mayor and temporary special
disqualification.
Article 206. Unjust interlocutory order.·Any judge who shall
knowingly render an unjust interlocutory order or decree shall suffer the
penalty of arresto mayor in its minimum period and suspension; but if he
shall have acted by reason of inexcusable negligence or ignorance and the
interlocutory order or decree be manifestly unjust, the penalty shall be
suspension.
Article 207. Malicious delay in the administration of justice.·
The penalty of prision correccional in its minimum period
244


practices under R.A. 3019, readily shows the striking

resemblance between them and the predicate crimes of
plunder. Paragraph 2 actually constitutes indirect bribery
while paragraphs 4 37and 5 constitute corrupt practices
under R.A. No. 3019. Logically, if the criminal acts that
make up the crime of plunder are categorized as exceptions
to the confidentiality rule, with more reason that the more
serious crime of plunder should be considered as falling
within the same exception. All involve dishonesty and
lack of integrity in public service. There is no reason
why plunder should be treated differently.
Petitioner now avers that this CourtÊs rulings in
Philippine National Bank and Banco Filipino do not apply
to the present case because the subpoenae duces tecum/ad
testificandum in said cases were issued prior to the
amendment of Section 8, R.A. No. 3019. He stresses that
under the old provision, the properties that may be
considered, when a public officialÊs acquisition of properties
through legitimate means cannot be satisfactory shown,
are only those of his „spouse and un-
_______________
shall be imposed upon any judge guilty of malicious delay in the

administration of justice.
Article 209. Betrayal of trust by an attorney or solicitor.·
Revelation of secrets.·In addition to the proper administrative action,
the penalty of prision correccional in its minimum period, or a fine
ranging from 200 to 1,000 pesos, or both, shall be imposed upon any
attorney-at-law or solicitor (procurador judicial) who, by any malicious
breach of professional duty or of inexcusable negligence or ignorance,
shall prejudice his client, or reveal any of the secrets of the latter learned
by him in his professional capacity.
The same penalty shall be imposed upon an attorney-at-law or
solicitor (procurador judicial) who, having undertaken the defense of a
client or having received confidential information from said client in a
case, shall undertake the defense of the opposing party in the same case,
without the consent of his first client.
37 See Separate Concurring Opinion by Justice Panganiban in Estrada

v. Sandiganbayan, G.R. No. 148560, November 19, 2001, 369 SCRA 394.
245
VOL. 509, NOVEMBER 30, 2006 245

38
married children.‰ However, under the new provision,
the phrase „spouse and unmarried 39
children‰ was
changed to „spouse and dependents.‰ Thus, he contends
that while he
_______________
38 Sec. 8. Dismissal due to unexplained wealth.·If in accordance

with the provisions of Republic Act Numbered One thousand three
hundred seventy-nine, a public official has been found to have acquired
during his incumbency, whether in his name or in the name of other
persons, an amount of property and/or money manifestly out of
proportion to this salary and to his other lawful income, that fact shall be
a ground for dismissal and removal. Properties in the name of the
spouse and unmarried children of such public official maybe taken
into consideration, when their acquisition through legitimate means
cannot be satisfactorily shown. Bank deposits shall be taken into
consideration in the enforcement of this section,
notwithstanding any provision of law to the contrary.
39 Section 8. Prima facie evidence and dismissal due to
unexplained wealth.·If in accord with the provisions of Republic Act
numbered One thousand three hundred seventy-nine, a public official
has been found to have acquired during his incumbency, whether in his
name or in the name of other persons, an amount of property and/or
money manifestly out of proportion to his salary and to his other lawful
income, that fact shall be a ground for dismissal or removal. Properties
in the name of the spouse and dependents of such public official may
be taken into consideration, when their acquisition through legitimate
means cannot be satisfactorily shown. Bank deposits in the name of
or manifestly excessive expenditures incurred by the public
official, his spouse or any of their dependents including but not
limited to activities in any club or association or any
ostentatious display of wealth including frequent travel abroad
of a nonofficial character by any public officials when such
activities entail expenses evidently out of proportion to

legitimate income, shall likewise be taken into consideration in

the enforcement of this section, notwithstanding any provision
of law to the contrary. The circumstances herein above mentioned
shall constitute valid ground for the administrative suspension of the
public official concerned for an indefinite period until the inves
246

is a „son‰ of the
40
accused in the plunder case, he is not his
„dependent.‰
PetitionerÊs argument lacks merit.
The amendment of Section 8 could not have the effect of
limiting the governmentÊs inquiry only to the properties of
the „spouse and dependents‰ of a public official. This is
in light of this CourtÊs broad pronouncement in Banco
Filipino that the inquiry extends to „any other persons,‰
and that „restricting the inquiry only to property
held by or in the name of the government official or
employee, or his spouse and unmarried children‰ is
„unwarranted‰ and „an absurdity that we cannot
ascribe to our lawmakers.‰ Thus:
„The inquiry into legally acquired property·or property NOT

„legitimately acquired‰·extends to cases where such property
is concealed by being held by or recorded in the name of
41
other persons. This proposition is made clear by R.A. No. 3019
which quite categorically states that the term, legitimately acquired
property of a public office or employee shall not include x x x
property unlawfully acquired by the respondent, but its ownership
is concealed by its being recorded in the name of, or held by,
respondentÊs spouse, ascendants, descendants, relatives or
any other persons.
To sustain the petitionerÊs theory, and restrict the inquiry
only to property held by or in the name of the government
official or employee, or his spouse and unmarried children
is unwarranted in the light of the provisions of the statutes
in question, and would make available to persons in
_______________

tigation of the unexplained wealth is completed. (As amended by BP. Blg.

195, March 16, 1982.)
40 A dependent is defined as „one who derives his or her main support
from another; means relying on, or subject to, someone else for
support; not able to exist or sustain oneself, or to perform anything
without the will, power, or aid of someone else.‰ (BlackÊs Law Dictionary,
5th Edition, 1979).
41 This should be Republic Act No. 1379.
247
VOL. 509, NOVEMBER 30, 2006 247

government who illegally acquire property an easy and

foolproof means of evading investigation and prosecution;
all they would have to do would be to simply place the
property in the possession or name of persons other than
their spouse and unmarried children. This is an absurdity
that we will not ascribe to the lawmakers.‰
Undoubtedly, the policy enunciated is to prevent a public

official from evading prosecution or investigation by
allowing government inquiry even to properties in the
name of his „spouse, ascendants, descendants,
relatives or any other persons.‰ The CourtÊs
pronouncement renders insignificant the personal
circumstance of the public officialÊs child, i.e. whether he is
a dependent or independent, married or unmarried. This is
entirely logical. Section 8 itself starts with the statement:
„If in accord with the provisions of Republic Act numbered
One thousand three hundred seventy–nine, a public official
has been found to have acquired during his incumbency,
whether in his name or in the name of other persons,
an amount of property and/or money manifestly out of
proportion to his salary and to his other lawful income, that
fact shall be a ground for
42
dismissal or removal.‰ Likewise,
Republic Act No. 1379, excludes the following properties
from the definition of „other legitimately acquired
property‰:
„1. Property unlawfully acquired by the respondent, but

its ownership is concealed by its being recorded in

the name of, or held by, the respondentÊs spouse,
ascendants, descendants, relatives or any
other person.
3. Property unlawfully acquired by the respondent, but
transferred by him to another person or persons
on or after the effectivity of this Act.‰
_______________
42 Otherwise known as „An Act Declaring Forfeiture in Favor of the

State any Property Found to Have Been Unlawfully Acquired by any
Public Officer or Employee and Providing for the Proceeding Therefor.‰
248

How can the government establish the nexus between a

public official and his property in the name of other persons
if this Court will limit the inquiry only to his „spouse and
dependents?‰ Indeed, there is truth in respondent PeopleÊs
statement that „the extension of inquiry into property held
by, or in the name of another persons other than the public
official, is sustained by a recognized legislative and public
policy adhered to by the courts.‰
Accordingly, the fact that petitioner is not an
accused in the plunder case does not insulate his
bank accounts from inquiry. Such inquiry is justified by
the fact that the Special Prosecution Panel is establishing a
nexus between his bank accounts and their alleged owner,
Former President Estrada, an accused in the plunder case.
Furthermore, as pointed out by respondent
Sandiganbayan, there is nothing in the exception „upon
order or a competent court in cases of bribery or dereliction
of duty of public officials‰ „which would suggest that in
order for the exception to apply, the owner of the
deposit or of the account must be an accused in the
case where the information relative to the account is
sought to be adduced.‰

Petitioner also contends that the money deposited in his

bank accounts cannot be considered the „subject matter‰ of
the plunder case.
I am not persuaded.
The „subject matter of litigation‰ as used in R.A. No.
1405 is expounded 43
in Union Bank of the Philippines v.
Court of Appeals, where the Court held:
„Union Bank is now before this Court insisting that the money
deposited in Account No. 0111-01854-8 is the subject matter of the
litigation. Petitioner cites the case of Mathay vs. Consolidated Bank
and Trust Company, where we defined Âsubject matterÊ of the
action,‰ thus:
_______________
43 G.R. No. 134699, December 23, 1999, 321 SCRA 563.
249
VOL. 509, NOVEMBER 30, 2006 249

ÂBy the phrase Âsubject matter of the actionÊ is meant Âthe

physical facts, the things real or personal, the money, lands,
chattels, and the like, in relation to which the suit is prosecuted,
and not the delict or wrong committed by the defendant.‰
Petitioner contends that the Court of Appeals confuses the Âcause

of actionÊ with the Âsubject of the action.Ê In Yusingco v. Ong
Hing Lian, petitioner points out, this Court distinguished the two
concepts.
x x x „The cause of action is the legal wrong threatened or committed,

while the object of the action is to prevent or redress the wrong by
obtaining some legal relief; but the subject of the action is neither of
these since it is not the wrong or the relief demanded, the subject
of the action is the matter or thing with respect to which the
controversy has arisen, concerning which the wrong has been
done, and this ordinarily is the property, or the contract and its
subject matter, or the thing in dispute.‰
The argument is well-taken. We note with approval the

difference between the Âsubject of the actionÊ from the Âcause of

action.Ê We also find petitionerÊs definition of the phrase „subject
matter of the action‰ is consistent with the term Âsubject matter
of the litigation,Ê as the latter is used in the Bank Deposits
Secrecy Act.
In Mellon Bank, N.A. v. Magsino, where the petitioner bank
inadvertently caused the transfer of the amount of US$1,000,000.00
instead of only US$1,000.00, the Court sanctioned the examination
of the bank accounts where part of the money was subsequently
caused to be deposited:
Âx x x Section 2 of [Republic Act No. 1405] allows the disclosure of

bank deposits in cases where the money deposited is the subject
matter of the litigation. Inasmuch as Civil Case No. 26899 is
aimed at recovering the amount converted by the Javiers for
their own benefit, necessarily, an inquiry into the whereabouts of
the illegally acquired amount extends to whatever is concealed
by being held or recorded in the name of persons other than the
one responsible for the illegal acquisition.Ê
250

Clearly, Mellon Bank involved a case where the money deposited

was the subject matter of the litigation since the money so
deposited was the very thing in dispute.‰
There is no denying that the subject matter of a plunder

case is the ill-gotten wealth accumulated, amassed or
acquired by a public officer either by himself or in
connivance with members of his family, relatives by affinity
or consanguinity, business associates, subordinates or other
persons, the aggregate
44
or total value of which is at least
P50,000,000.00. Since the money deposited in petitionerÊs
bank accounts is being proven to be a portion of former
President EstradaÊs ill-gotten wealth, it follows that it is
the „thing or matter with respect to which the crime of
plunder has arisen.‰ Without the ill-gotten wealth,
there can be no plunder. Correspondingly, R.A. No. 7080
penalizing plunder mandates that courts shall declare any

45
and all ill-gotten wealth forfeited in favor of the State.
Government recovery of the ill-gotten wealth being a
consequence of plunder, necessarily an inquiry into the
whereabouts of the ill-gotten wealth extends to properties
being held or recorded in the name of persons other than
the one responsible for the crime of plunder.
„Extremely-Detailed‰ Information contained

in the Special Prosecution PanelÊs Requests for
Subpoena Duces Tecum/Ad Testificandum - Violative
of
PetitionerÊs Right to Due Process and Privacy
Petitioner also asserts that the „extremely-detailed‰

information in the Special Prosecution PanelÊs requests
shows prior illegal disclosure of his bank accounts.
I agree.
_______________
44 Section 2 of R.A. No. 7080.

45 Id.
251
VOL. 509, NOVEMBER 30, 2006 251

46
In Grisworld v. Connecticut, the United States Supreme
Court announced for the first time that the right to privacy
is an independent constitutional right; and that: „Specific
guarantees in the Bill of Rights have penumbras, formed
by emanation from those guarantees that help give them
life and substance. Various guarantees create zones of
privacy.‰ Our Bill of Rights, enshrined in Article III of the
Constitution, provides at least two guarantees that
explicitly create zones of privacy. They highlight a personÊs
„right to be let alone‰ or the „right to determine what, how
much, to whom 47
and when information about himself shall
be disclosed.‰ Section 2 guarantees „the right of the
people to be secure in their persons, houses, papers

and effects against unreasonable searches and

seizures of whatever nature and for any purpose.‰
Section 3 renders inviolable the „privacy of
communication and correspondence‰ and further
cautions that „any evidence obtained in violation of
this or the preceding section shall be inadmissible
for any purpose in any proceeding.‰
These zones
48
of privacy are also recognized and protected
in our laws, such as civil and criminal laws. Article 26 of
the Civil Code mandates that „every person shall
respect the dignity, personality, privacy and peace of
mind of his neighbors and other persons‰ and
punishes as actionable torts acts such as „prying into the
privacy of anotherÊs residence; and meddling with or
disturbing the private life or family relations of
another.‰ Article 32 states that „any public officer or
employee, or any private individual, who directly
obstructs, defeats, violates or in
_______________
46 381 U.S. 479 (1965). See also Puno, Legislative Investigations and
the Right to Privacy, 2005.
47 Constitutional and Legal Systems of ASEAN Countries, Sison,
Academy of ASEAN Law and Jurisprudence, 1990, at 221, citing I.R.
Cortes, The Constitutional Foundations of Privacy, 7 (1970).
48 Marquez v. Desierto, supra.
252

any manner impedes or impairs x x x the right to be

secure in oneÊs person, house, papers, and effects
against unreasonable searches and seizures; x x x
the privacy of communication and correspondence‰
shall49 be liable for damages.
50
On the other hand,
51
Article
209, Articles 290-292, and Articles 280-281 of the
Revised Penal Code

_______________
49 Article 209. Betrayal of trust by an attorney or solicitor.·

Revelation of secrets.·In addition to the proper administrative action,
the penalty of prision correccional in its minimum period, or a fine
ranging from 200 to 1,000 pesos, or both, shall be imposed upon any
attorney-at-law or solicitor (procurador judicial) who, by any malicious
breach of professional duty or of inexcusable negligence or ignorance,
shall prejudice his client, or reveal any of the secrets of the latter learned
by him in his professional capacity.
The same penalty shall be imposed upon an attorney-at-law or
solicitor (procurador judicial) who, having undertaken the defense of a
client or having received confidential information from said client in a
case, shall undertake the defense of the opposing party in the same case,
without the consent of his first client.
50 Article 290. Discovering secrets through seizure of
correspondence.·The penalty of prision correccional in its minimum
and medium periods and a fine not exceeding 500 pesos shall be imposed
upon any private individual who in order to discover secrets of another,
shall seize his papers or letters and reveal the contents thereof. x x x.
Article 291. Revealing secrets with abuse of office.·The penalty
of arresto mayor and a fine not exceeding 500 pesos shall be imposed
upon any manager, employee, or servant who, in such capacity, shall
learn the secrets of his principal or master and shall reveal such secrets.
Article 292. Revelation of industrial secrets.·The penalty of
prision correccional in its minimum and medium periods and a fine not
exceeding 500 pesos shall be imposed upon the person in charge,
employee or workman of any manufacturing or industrial establishment
who, to the prejudice of the owner thereof, shall reveal the secrets of the
industry of the latter.
51 Article 280. Qualified trespass to dwelling.·Any private person
who shall enter the dwelling of another against the
253
VOL. 509, NOVEMBER 30, 2006 253

treat as crimes (a) revelation of secrets by an attorney-at-

law or solicitor, (b) discovery and revelation of industrial
secrets, and (c) trespass to dwelling, respectively.
Aside from the foregoing, invasion of privacy is

considered an offense
52
in special laws such as the Anti-
Wiretapping53 Law, the Intellectual Property Code of the
Philippines and, of course, R.A. No. 1405, the Secrecy of
Bank Deposits Act.
The myriad of laws enumerated only show that there are
certain areas in a personÊs life which even if accessible to
the public, may be constitutionally and legally protected as
„private.‰
Now, in evaluating a claim for violation of the right to
privacy, a court must determine whether a person has
exhibited a reasonable expectation of privacy and, if so,
whether that expectation has 54 been violated by
unreasonable government intrusion. Applying these to the
case at bar, the important inquiries are: first, did
petitioner exhibit a reasonable expec-
_______________
latterÊs will shall be punished by arresto mayor and a fine not

exceeding 1,000 pesos. x x x.
Article 281. Other forms of trespass.·The penalty of arresto menor
or a fine not exceeding 200 pesos, or both, shall be imposed upon any
person who shall enter the closed premises or the fenced estate of
another, while either of them are uninhabited, if the prohibition to enter
be manifest and the trespasser has not secured the permission of the
owner or the caretaker thereof.
52 Republic Act No. 4200, An Act to Prohibit and Penalize Wire
Tapping and other Related Violations of the Privacy of Communications,
and for other Purposes.
53 Republic Act No. 8293, „An Act Prescribing the Intellectual Property
Code and Establishing the Intellectual Property Office, Providing for its
Powers and Functions, and for other Purposes.‰ January 1, 1998.
54 Burrows v. Superior Court of San Bernardino County, 13 Cal. 3d
238, 529 P 2d 590 (1974). See Katz v. United States (1967), 389 U.S. 347,
350-352, 88 S. Ct. 507, 19 L. Ed. 2d 576; People v. Krivda, (1971) 5 Cal.
3d 357, 364, 96 Cal. Rptr. 62, 486 P. 2d 1262; 8 Cal. 3d 623-624,105 Cal.
Rptr. 521, 504 P. 2d 457.
254


tation of privacy over his bank accounts?; and second, did

the government violate such expectation?
The answers to both are in the affirmative.
It cannot be gainsaid that the customer of a bank
expects that the documents which he transmits to the bank
in the course of his business operations, will remain 55
private, and that such an expectation is reasonable.
Financial transactions can reveal much about a personÊs
affairs, activities, beliefs, habits and associations. Indeed,
the totality
56
of bank records provides a virtual current
biography. Checks, for instance, in a sense, define a
person. By examining them, the agents get to know his
doctors, lawyers, creditors, political allies, social
connections, religious affiliations, educational interests, the
57
papers and magazines he reads, and so on ad infinitum.
In other words, oneÊs bank account mirrors not only his
finances, but also his debts, his way of life, his family and
his civic commitment. Such reality places a customerÊs
bank account within the „expectations of privacy‰ category.
In the Philippines, the expectation is heightened by the
enactment of R.A. No. 1405 which mandates that all
deposits of whatever nature are considered as of an
„absolutely confidential nature‰ and „may not be
examined, inquired or looked into by any person‰
except under the instances therein.
Admittedly, a bank customer knowingly and voluntarily
divulges his financial affairs with the bank, but such is
immaterial. The fact that one has disclosed private papers
to the bank within the context of confidential customer-
bank relationship, does not mean that one has waived all
right to the privacy of the papers. Like the user of the pay
phone in Katz
_______________
55 Burrows v. Superior Court of San Bernardino County, supra.

56 United States v. Miller, 425 U.S. 435 (1976). See dissenting opinion
of Justice Brennan,
57 California Bankers AssÊn v. Shultz, 416 U.S. i-1,85 (1974), See
dissenting opinion of Justice Douglas.
255

VOL. 509, NOVEMBER 30, 2006 255

58
v. United States, who, having paid the toll, was entitled to
„assume that the words he utters into the mouthpiece will
not be broadcast to the world,‰ so the customer of a bank,
having written or deposited a check, has a reasonable
expectation that his check will be examined for bank
purposes only. Practically speaking, a customerÊs disclosure
of his financial affairs is not entirely volitional, since it is
impossible to participate in the economic life of
contemporary
59
society without maintaining a bank
account. Consequently, the customerÊs reasonable
expectation is that, absent customary legal process, the
matter he reveals to the bank will60be utilized by the bank
only for internal banking purposes.
In the instant case, while admittedly, respondent
SandiganbayanÊs inquiry into petitionerÊs bank
accounts falls under61
the two exceptions mentioned
in R.A. No. 1405, however, this Court observes that
the manner of inquiry violates petitionerÊs rights to
due process and privacy. At this juncture, it is worthy to
note that petitionerÊs bank accounts were inquired into
twice, first was through subpoenae duces tecum issued by
the Office of the Ombudsman and second was through
subpoenae duces tecum/ad testificandum issued by
respondent Sandiganbayan. Under both instances,
petitioner was completely unaware of the issuances of such
subpoenae.
Petitioner persistently bewailed before respondent
Sandiganbayan the prior disclosure of his bank accounts
pursuant to the subpoenae issued by the Office of the
Ombudsman absent any pending case in court and
personal notice to him. He sought the quashal of
respondent SandiganbayanÊs sub-
_______________
58 Supra.
59 Burrows v. Superior Court of San Bernardino County, supra.
60 Supra.
61 1) Upon order of a competent court in cases of bribery or dereliction

of duty of public officials;

2) In cases where the money deposited or invested is the subject
matter of the litigation.
256

poenae duces tecum/ad testificandum on the ground that

the Special Prosecution PanelÊs requests for the issuance of
the said subpoenae were based on information illegally
acquired by the Office of the Ombudsman.
I am swayed with the merit62of petitionerÊs grievance.
In Marquez v. Desierto, Ombudsman Aniano A.
Desierto ordered petitioner Lourdes Marquez, a Branch
Manager of Union Bank, to produce for purposes of an in
camera inspection certain bank documents relative to a
case pending before the Office of the Ombudsman.
Ombudsman Desierto cited the Constitution and Section 15
(8) of R.A. No. 6770 as bases of his authority. Petitioner
Marquez initially refused but, after having been threatened
with a contempt proceeding, she filed a petition for
declaratory relief seeking a clarification of the issue
„whether the Order of the Ombudsman to have an in
camera inspection of the questioned account is
allowed as an exception to the law on secrecy of
bank deposits.‰ The CourtÊs ruling is enlightening, thus:
„An examination of the secrecy of bank deposits law (R.A. No. 1405)
would reveal the following exceptions:
1. Where the depositor consents in writing;

2. Impeachment case;
3. By court order in bribery or dereliction of duty cases against
public officials.
4. Deposit is subject of litigation.
5. Sec. 8, R.A. No. 3019, in cases of unexplained wealth as held
in the case of PNB v. Gancayco.
The order of the Ombudsman to produce for in camera inspection

the subject accounts with the Union Bank of the Philippines, Julia

Vargas Branch, is based on a pending investigation at the

Office of the Ombudsman against Amado Lagdameo, et al. for
violation of R.A. No. 3019, Sec. 3 (e) and (g) relative to the Joint
_______________
62 Supra.
257
VOL. 509, NOVEMBER 30, 2006 257

Venture Agreement between the Public Estates Authority and

AMARI.
We rule that before an in camera inspection may be allowed
there must be a pending case before a court of competent
jurisdiction. Further, the account must be clearly identified, the
inspection limited to the subject matter of the pending case before
the court of competent jurisdiction. The bank personnel and the
account holder must be notified to be present during the
inspection, and such inspection may cover only the account
identified in the pending case.‰
In Union Bank of the Philippines v. Court of Appeals, we held
that ÂSection 2 of the Law on Secrecy of Bank Deposits, as amended,
declares bank deposits to be Âabsolutely confidentialÊ except:
(1) In an examination made in the course of a special or general

examination of a bank that is specifically authorized by the
Monetary Board after being satisfied that there is
reasonable ground to believe that a bank fraud or serious
irregularity has been or is being committed and that is
necessary to look into the deposit to establish such fraud or
irregularity;
(2) In an examination made by an independent auditor hired by
the bank to conduct its regular audit provided that the
examination is for audit purposes only and the results
thereof shall be for the exclusive use of the bank;
(3) Upon written permission of the depositor;
(4) In cases of impeachment;
(5) Upon order of a competent court in cases of bribery or
dereliction of duty of public officials; or

(6) In cases where the money deposited or invested is the

subject matter of the litigation.Ê
In the case at bar, there is yet no pending litigation before

any court of competent authority. What is existing is an
investigation by the Office of the Ombudsman. In short,
what the Office of the Ombudsman would wish to do is to
fish for additional evidence to formally charge Amado
Lagdameo, et al., with the Sandiganbayan. Clearly, there
was no pending case in court which would warrant the
opening of the bank account for inspection.‰
258

Thus, as held by the Court, before an in camera inspection

of bank documents maybe allowed, there must be a
pending case before a court of competent
jurisdiction. The Information for plunder against Former
President Estrada was filed with respondent
Sandiganbayan on April 4, 2001. On the other hand, the
Ombudsman issued the subpoenae duces tecum on
February 8, 16, and March 7, 2001. Clearly, there was
yet no pending litigation before any court when such
subpoenae were issued. Following the CourtÊs ruling in
Marquez, what the Office of the Ombudsman would wish to
do was to „fish for evidence‰ in order to formally charge
former President Estrada before respondent
Sandiganbayan.
At this point, it should be emphasized that the authority
of the Ombudsman „to examine and have access to bank
accounts and records‰ must be read in conjunction with
Section 2 of R.A. No. 1405 providing that deposits of
whatever nature shall be considered confidential except in
several instances already mentioned. This is because
bank deposits belong to a protected zone where
government intrusion could infringe legitimate
expectation of privacy. An opposite course is
unwarranted. 63
In United States v. United States District Court, the US

Supreme Court held that the potential for abuse is

particularly acute where the legislative scheme
permits access to information without invocation of
the judicial process. In such instances, the important
responsibility for balancing societal and individual
interests is left to unreviewed executive discretion, rather
than the
64
scrutiny of a neutral magistrate. In Katz v. United
States, the same Court ruled that, „[t[he prosecutorsÊ duty
and responsibility is to enforce the laws, to investigate and
to prosecute. Those
_______________
63 407 U.S. 297, 316-317, 92 S Ct. 2125, 32 L. Ed. 2d 752, (416 U.S.,
pp. 78-79, 94 S.Ct. at 1526).
64 389 U.S. 347, 19 L. Ed 2d 576, 88 S Ct 507.
259
VOL. 509, NOVEMBER 30, 2006 259

charged with the investigative and prosecutorial duty

should not be the sole judges of when to utilize
constitutionally sensitive means in pursuing their tasks.
The historical judgment is that unreviewed
executive discretion may yield too readily to
pressures to obtain incriminating evidence and
overlook potential invasions of privacy.‰ Between the
government and the citizen, there must be a neutral entity
that should balance the formerÊs claim of authority vis-á-vis
the latterÊs assertion of rights.
By the natural scheme of things, the Office of the
Ombudsman can hardly be characterized as detached,
disinterested and neutral. Its mandate is to investigate and
prosecute any act or omission of any public officer or
employee, office or agency65
that appears to be illegal, unjust,
improper or inefficient. In carrying out such mandate, it
is expected to act with vigor and aggressiveness. But to
permit such office to have access to bank records without
any judicial control as to relevancy or other traditional
requirements of due process and to allow the evidence to be

used in any subsequent prosecution, opens the door to a

vast and
66
unlimited range of very real abuses of police
power. True,
67
there are administrative summonses for
documents recognized in other jurisdictions, but there is a
requirement that their enforcement
68
receives a judicial
scrutiny and a judicial order. In this regard, I am appalled
by the „whole sale‰ subpoena duces tecum issued by the
Ombudsman directing the „President or Chief Executive
Officer of Urban Bank‰ to produce „bank records and all
documents relative thereto pertaining to all bank
accounts (Savings, Current, Time Deposit, Trust,
Foreign
_______________
65 Section 15 of R.A. No. 6770.

66 See Burrows v. Superior Court of San Bernardino County, supra.
67 Cf. Camara v. Municipal Court, 387 U.S. District Court, 407 U.S.
297, 313-318 cited in the Dissenting Opinion of Justice Douglas in
California Bankers AssÊn v. Shultz.
68 United States v. United States District Court, supra.
260

Currency Deposits, etc.) under the account names of

Jose Velarde, Joseph E. Estrada, Laarni Enriquez,
Guia Gomez, Joy Melendrez, Peachy Osorio, Rowena
Lopez, Kevin or Kelvin Garcia, 727, 737, 747, 757 and
858.‰ Indubitably, such blanket subpoena provides
occasions for „fishing expedition.‰
Above everything else, however, what strikes us most is
the patent unfairness of the process. First in the Bill of
Rights is the mandate that no person shall be deprived of
his life, liberty or property without due process of law.
Courts have held that the right of personal privacy
is one aspect of69the „liberty‰ protected by the Due
Process Clause. Basic due process demands that the
Office of the Ombudsman furnish petitioner a copy of the70
subpoenae duces tecum it issued. In Marquez v. Desierto,

this Court held: „The bank personnel and the account

holder must be notified to be present during the
inspection, and such inspection may cover only the
account identified in the pending case.‰ Such notice is
not too much to ask for, after all, an accountholder bears
the risk 71not only of losing his privacy but, also, his
property. Of course, not to mention the procedural
_______________
69 16B Am Jur 2d § 604, citing Washington v. Gluckberg, 117 S.Ct.

2258, 138 L. Ed. 2d 772 (U.S. 1997), for concurring opinion, see, 117 S.
Ct. 2302 (U.S. 1997); Carey v. Population Services, Intern., 431 U.S. 678,
97 S.Ct. 2010, 52 L. Ed. 2d 675, 2 Media L. Rep. (BNA) 1935 (1977); Roe
v. Wade, 410 U.S. 113, 93 S.Ct. 705, 35 L. Ed. 2d 147 (1973), for
concurring opinion, see, 410 U.S. 179, 93 S.Ct. 755, 35 L. Ed. 2d 147
(1973) and for dissenting opinion, see, 410 U.S. 179, 93 S. Ct. 762, 35 L.
Ed. 2d 147 (1973) and rehÊq denied, 410 U.S. 959, 93 S.Ct. 1409, 35 L. Ed.
2d 694 (1973); Vanderlinden v. State of Kan., 874 F Supp. 1210 (D. Kan
1995), judgment aff Êd, 103 F. 3d 940 (10th cir. 1996).
70 Supra.
71 The court shall declare any and all ill-gotten wealth and their
interests and other incomes and assets including the properties and
shares of stocks derived from the deposit or investment thereof
261
VOL. 509, NOVEMBER 30, 2006 261

impasse that is encountered by such accountholder who

cannot contest the propriety of the issuance of a subpoena.
In this case, petitioner was completely unaware of the
issuance of subpoenae duces tecum, hence, he never had the
opportunity to challenge them. As a matter of fact, almost
two years had passed before he learned of such issuance
and the resulting disclosure. Indeed, the ugly truth here is
that neither the Office of the Ombudsman nor the PDIC
notified petitioner of the impending and actual disclosure
of his bank accounts. Such absence of notice is a fatal
constitutional defect that inheres in a process that omits
provision for notice to the bank customer of an invasion of

72
his protected right.
Now, let us take a glimpse at the proceedings before
respondent Sandiganbayan.
The proceedings before respondent Sandiganbayan also
leave much to be desired. Neither respondent
Sandiganbayan nor the Special Prosecution Panel nor
PDIC furnished petitioner copies of the subpoenae duces
tecum/ad testificandum or of the requests for their
issuance. It bears reiterating that it was only through the
media that petitioner learned about such requests.
Definitely, something is inherently wrong in a public
proceeding that allows a holder of bank account, subject of
litigation, to be completely uninformed. Also not to be
overlooked is the respondent SandiganbayanÊs oral
directive to petitioner to file his motion to quash not later
than 12:00 noon of January 28, 2003. This notwithstanding
the fact that it was only the day before, or on January 27,
2003, that petitioner learned about the requests and that
he was yet to procure the services of a counsel. Every
civilized state adheres to the principle that when a personÊs
life and liberty are jeopard-
_______________
forfeited in favor of the State. (As amended by Sec. 12, R.A. No. 7659).
72 See Marquez v. Desierto, G.R. No.135882, June 27, 2001, 359 SCRA
772, stating that „the bank personnel and the account holder must be
notified to be present during the inspection, and such inspection may
cover only the account identified in the pending case.‰
262

ized by government action, it behooves a democratic

government to see to it that this jeopardy is fair,
reasonable and according to time-honored tradition.
The importance of this principle is eloquently
underscored by one observer who said: „The quality of
a civilization is largely

73
determined by the fairness of its criminal trials.‰
Respondent Sandiganbayan cannot 74
justify its omission by
relying on Adorio v. Bersamin, which held that: „Requests
by a party for the issuance of subpoenas do not require
notice to other parties to the action. No violation of due
process results by such lack of notice since the other parties
would have ample opportunity to examine the witnesses and
documents subpoenaed once they are presented in court.‰
Suffice it to say that petitioner was not a party to the
plunder case, hence, he could not have the opportunity to
examine the witnesses and the documents subpoenaed.
True, bank accounts at times harbor criminal plans. But
this is not a reason to declare an open season for inquiry.
Customers have a constitutionally justifiable expectation of
privacy in the documentary details of the financial
transactions reflected in their bank accounts. That wall of
privacy, however, is not impregnable. Our Constitution, as
well as our laws, provides procedures whereby the
confidentiality of oneÊs financial affairs may be disclosed. In
other words, access to bank records is controlled by
adequate legal process. Here, the subpoenae issued by
respondent Sandiganbayan, tainted as they are by the
vices that afflict the proceedings before the Office of the
Ombudsman, cannot be considered to have been issued
pursuant to such adequate legal process. Petitioner,
therefore, has reason to feel aggrieved.
Section 4, Rule 21 of the 1997 Rules of Civil Procedure,
as amended, provides that the court may quash a
subpoenae
_______________
73 Eugene v. Rostow, Introduction to Edward Bennet Williams, OneÊs

ManÊs Freedom (New York, N.Y.: Atheneum, 1962) p. ix.
74 Supra.
263
VOL. 509, NOVEMBER 30, 2006 263


duces tecum 75upon motion if it is „unreasonable and

oppressive.‰ Here, the three (3) subpoenae duces
tecum/ad testificandum issued by respondent
Sandiganbayan are „unreasonable and oppressive‰ for the
reasons earlier mentioned. I thus find respondent
Sandiganbayan to have committed grave abuse of
discretion in issuing them.
One last word. The violation of petitionerÊs right to
privacy could have been obviated had respondent court
complied with its duty to be watchful for the constitutional
rights of the citizens and against any stealthy
encroachments
76
thereon. The motto should always be obsta
principiis.
IN VIEW OF THE FOREGOING, I vote to GRANT the
Petition. The assailed Resolutions dated February 7,
February 12 and March 11, 2003 issued by respondent
Sandiganbayan in Criminal Case No. 26558, „People of the
Philippines v. Former President Joseph Ejercito Estrada, et
al.‰ being tainted with grave abuse of discretion, should be
SET ASIDE. The subpoenae duces tecum/ad testificandum
dated January 21, 24 and 31, 2003, should be QUASHED
for being unreasonable and oppressive.
CONCURRING OPINION
CALLEJO, SR., J.:
I concur in the encompassing ponencia of our esteemed

colleague Mme. Justice Conchita Carpio-Morales, however,
I find it imperative to submit my concurring opinion and
elucidate on the basis thereof.
_______________
75 A subpoena duces tecum can be invalid for variety of reasons, as

when it is unduly burdensome, violates the right against
selfincrimination, or calls for privileged documents. 81 Am Jur § 25
citing United States v. Roberts (CA2 NY) 852 F2d 671, cert den 488 US
993, 102 L ed 2d 583, 109 S Ct 556.
76 Boyd v. United States, 116 U.S. 616 (1886).
264


The basic factual and procedural antecedents of the case

are restated as follows:
In connection with Criminal Cases Nos. 26558 (Plunder)
and 26565 (Illegal Use of Alias) filed against former
President Joseph Ejercito Estrada, and upon the written
requests of the Special Prosecution Panel, the
Sandiganbayan issued the subpoenae duces tecum/ad
testificandum dated January 21 and 24, 2003 addressed to
the respective Presidents of the Export and Industry Bank
(EIB, formerly Urban Bank and Urbancorp Investment,
Inc.) and Equitable-PCIBank. The subpoenas directed the
said officers, or their authorized representatives, to appear
before the Sandiganbayan and bring with them documents,
among others, pertaining to Trust Account No. 858 (with
Urban Bank) and Savings Account No. 0116-17345-9 (also
with Urban Bank), both in the name of petitioner Joseph
Victor (JV) G. Ejercito.
The written requests of the Special Prosecution Panel
enumerated the following documents to be subpoenaed as
follows:
I. For Trust Account No. 858:

2. Trading Order No. 020385, dated January 29, 1999;
4. Original/Microfilm copies, including the dorsal side
of the following:
a) Bank of Commerce MC#0256254 in the amount of
P2,000,000;
b) Urban Bank Corp. MC#34181 dated November
8,1999 in the amount of P10,875,749.43;
c) Urban Bank MC#34182 dated November 8, 1999
in the amount of P42,716,554.22;
d) Urban Bank MC#37661 dated November 23, 1999
in the amount of P54,161,496.52;
5. Trust Agreement dated January 1999

Trustee: Joseph Victor C. Ejercito

265
VOL. 509, NOVEMBER 30, 2006 265


6. Ledger of the Span #858
SPAN #858
1. signature cards; and
2. statement of account/ledger
III. Urban Bank ManagerÊs Check and their
corresponding Urban BankÊs Check Application Form
as follows:
1. MC#039975 dated January 18, 2000 in the amount
of P70,000,000.00;
of P2,000,000.00;
of P2,000,000.00; and
of P1,000,000.00.
Claiming to have learned about the subpoenae duces

tecum/ad testificandum only through news reports,
petitioner JV Ejercito filed motions to quash them alleging
that (a) they
1
violated the bank secrecy laws (Republic Act
No. 1405 as amended by Presidential Decree No. 1792 and
Republic Act 8791); (b) his case is not one of the recognized
exceptions enumerated in the said laws as he is not an
accused in the plunder and illegal use of alias cases; (c)
there appears to be a conspiracy between the bank officials
and the prosecution to violate the bank secrecy laws as the
requests for the subpoenas contained particulars which

could have been known only if the bank had released in

advance the information containing the details2 of his bank
accounts; (d) under Republic Act No. 3019 inquiry by
subpoena into bank deposits can only be had if it was
established that: (1) the accused public official
_______________
1 The Secrecy of Bank Deposits Act.

2 The Anti-Graft and Corrupt Practices Act.
266

has been found to have acquired during his incumbency an

amount of property manifestly out of proportion to his
salary; (2) the ownership of the property unlawfully
acquired is concealed by recording the same in the name of
friends or relatives; and (3) the acquisition through
legitimate means of the money so deposited cannot be
satisfactorily shown.
Former President Estrada for himself likewise moved for
the quashal of the subpoenas on the same grounds relied
upon by petitioner JV Ejercito and, additionally, that the
documents sought were not relevant to the amended
information against him.
Acting thereon, the Sandiganbayan issued the assailed
Resolution dated February 7, 2003, denying the motions to
quash the subpoenas holding that its issuance of the same
properly falls under one of the exceptions to the bank
secrecy laws, particularly the clause in Section 2 of
Republic Act (RA) 1405 thus: „upon order of a competent
court in cases of bribery or dereliction of duty of public
officials.‰ The Sandiganbayan reasoned that the crime of
plunder was analogous to the said cases. It opined that the
fact that petitioner JV Ejercito was not an accused in the
plunder cases was of no moment because RA 3019 allows
the inquiry into the bank deposits not only of the accused
public official but also those of his spouse and children.
Further, whether or not the amount of deposits was

manifestly out of proportion to the income need not be

proved first before inquiry could be had on the bank
deposits, rather such inquiry could be used in proving the
case.
The Sandiganbayan also held that3 petitioner JV
EjercitoÊs reliance on Marquez v. Desierto was misplaced.
In Marquez, the Court disallowed the in camera inspection
of accounts in connection with a case pending before the
Ombudsman. In the present case, however, the
Sandiganbayan held that there was precisely a pending
case before it, a competent court
_______________
3 412 Phil. 387; 359 SCRA 772 (2001).
267
VOL. 509, NOVEMBER 30, 2006 267

within the meaning of the exception to the bank secrecy

laws. The Sandiganbayan also pointed out that there was
nothing irregular in the issuance of the subpoenas because
it was not required that the other party be notified of such
requests. No violation of due process resulted by such lack
of notice since the other parties would have ample
opportunity to examine the witnesses and documents
subpoenaed once they are presented in court.
A similar motion was filed by petitioner JV Ejercito
involving the subpoenae duces tecum/ad testificandum
issued to the representative of the Urban Bank and Mrs.
Aurora Baldoz of the Philippine Deposit Insurance
Commission (PDIC). The said motion was denied by
Sandiganbayan in the assailed Resolution dated February
12, 2003. The motions for reconsideration were denied in
the assailed Resolution dated March 11, 2003.
Petitioner JV Ejercito now comes to the Court assailing
the SandiganbayanÊs resolutions denying his motions to
quash the subpoenae duces tecum/ad testificandum.
As the petitioner himself submits, the following are the
issues for the CourtÊs resolution:

WHETHER OR NOT RESPONDENT COURT ACTED IN EXCESS

OF ITS JURISDICTION OR WITH GRAVE ABUSE OF
DISCRETION IN RULING THAT THE SUBPOENA ON
PETITIONERÊS BANK ACCOUNTS FALLS UNDER THE
EXCEPTIONS PROVIDED UNDER R.A. NO. 1405
WHETHER OR NOT RESPONDENT COURT ACTED IN
EXCESS OF ITS JURISDICTION OR WITH GRAVE ABUSE OF
DISCRETION IN RULING THAT THE CASES OF PNB VS.
GANCAYCO AND BANCO FILIPINO VS. PURISIMA ARE
APPLICABLE TO THE INSTANT CASE
WHETHER OR NOT RESPONDENT COURT ACTED IN
EXCESS OF ITS JURISDICTION OR WITH GRAVE ABUSE OF
DISCRE-
268

TION IN RULING THAT THE MARQUEZ VS. DESIERTO CASE

4
IS NOT APPLICABLE TO THE INSTANT CASE.
The petitioner does not deny his ownership of Trust

Account No. 858 and Savings Account No. 0116-17345-9. In
fact, he expressly admits the same and even explains that
these were originally opened at Urban Bank
5
but are now
maintained at Export and Industry Bank.
The petitioner argues that his accounts do not fall under
any of the exceptions enumerated under Section 2 of RA
1405. The said provision reads:
„Sec. 2. All deposits of whatever nature with banks or banking

or office, except, when the examination is made in the course of a
special or general examination of a bank and is specifically
authorized by the Monetary Board after being satisfied that there is
reasonable ground to believe that a bank fraud or serious
irregularity has been or is being committed and that it is necessary
to look into the deposit to establish such fraud or irregularity, or

when the examination is made by an independent auditor hired by

the bank to conduct its regular audit provided that the examination
is for audit purposes only and the results thereof shall be for the
exclusive use of the bank, or upon written permission of the
depositor, or in case of impeachment, or upon order of a competent
matter of litigation.‰ (As amended by PD No. 1792)
Based on this provision, it has been declared that bank

deposits are absolutely confidential except in the following
instances:
_______________
4 Memorandum of the petitioner, p. 17.

5 Id., at p. 3.
269
VOL. 509, NOVEMBER 30, 2006 269

„(1) In an examination made in the course of a special

or general examination of a bank that is specifically
authorized by the Monetary Board after being
satisfied that there is reasonable ground to believe
that a bank fraud or serious irregularity has been
or is being committed and that it is necessary to
look into the deposit to establish such fraud or
irregularity;
(2) In an examination made by an independent auditor
hired by the bank to conduct its regular audit
provided that the examination is for audit purposes
only and the results thereof shall be for the
exclusive use of the bank;
(3) Upon written permission of the depositor;
(4) In cases of impeachment;
(5) Upon order of a competent court in cases of bribery
or dereliction of duty of public officials; or
(6) In cases where the money deposited or invested is

6
the subject matter of litigation.‰
The petitioner points out that one of the exceptions

mentioned is „upon order of a competent court in cases of
bribery or dereliction of duty of public officials.‰ Since the
cases filed against his father, former President Estrada, are
not for these crimes but for plunder and illegal use of alias,
then the said exception does not allegedly apply. Further,
his accounts do not fall under exception (6) as they are not
allegedly „subject matter of litigation.‰
This argument of the petitioner is not persuasive.
Former President Estrada is being charged with plunder
7
as
defined and penalized under Section 2 of RA 7080, to wit:
„Definition of the Crime of Plunder, Penalties.·Any public officer

who, by himself or in connivance with members of his family,
relatives by affinity or consanguinity, business associates,
subordinates or other persons, amasses, accumulates or acquires ill-
gotten wealth through a combination or series of overt or criminal
acts as
_______________
6 Union Bank of the Philippines v. Court of Appeals, 378 Phil. 1177; 321
SCRA 563 (1999).
7 An Act Defining and Penalizing the Crime of Plunder.
270

described in Section 1(d) hereof in the aggregate amount or total

value of at least Fifty million pesos (P50,000,000.00) shall be guilty
of the crime of plunder and shall be punished by reclusion perpetua
to death. Any person who participated with the said public officer in
the commission of an offense contributing to the crime of plunder
shall likewise be punished for such offense. In the imposition of
penalties, the degree of participation and the attendance of
mitigating and extenuating circumstances, as provided by the
Revised Penal Code, shall be considered by the court. The court
shall declare any and all ill-gotten wealth and their interest and

other incomes and assets including the properties and shares of

stocks derived from the deposit or investment thereof forfeited in
favor of the State. (As amended by Sec. 12, RA 7659).‰
Section 1(d) of the same law defines „ill-gotten wealth‰ as

„any asset, property, business enterprise or material
possession of any person within the purview of Section 2
thereof, acquired by him directly or indirectly through
dummies, nominees, agents, subordinates, and/or business
associates by any combination or series of the following
means or similar schemes:
„1. Through misappropriation, conversion, misuse or

treasury;
2. By receiving, directly or indirectly, any commission,
gift, share, percentage, kickbacks or any other form
of pecuniary benefit from any person and/or entity
in connection with any government contract or
project or by reason of the office or position of the
public officer concerned;
3. By the illegal or fraudulent conveyance or
Government or any of its subdivisions, agencies or
instrumentalities, or government-owned or
4. By obtaining, receiving or accepting directly or
form of interest or participation including the
promise of future employment in any business
enterprise or undertaking;
271
VOL. 509, NOVEMBER 30, 2006 271

5. By establishing agricultural, industrial or

commercial monopolies or other combination and/or
implementation of decrees and others intended to
benefit particular persons or special interests; or

6. By taking undue advantage of official position,

authority, relationship, connection or influence to
Filipino people and the Republic of the Philippines.‰
It can be readily gleaned that the gravamen of plunder is

the amassing, accumulating or acquiring of ill-gotten
wealth by a public officer, his family or close 8associates. In
Philippine National Bank v. Gancayco, the Court
explained that „cases of unexplained wealth are similar to
cases of bribery or dereliction of public duty and no reason
is seen why these two classes of cases cannot be excepted
from the rule making bank deposits confidential. The policy
as to one cannot be different from the policy as to the other.
This policy expresses the notion that a public office is a
public trust and any person enters upon its discharge does
so with full knowledge that his life,
9
so far as relevant to his
duty, is open to public scrutiny.‰
A plain reading of the definition of plunder and the
manner by which it may be committed as provided in RA
7080 reveals that its policy also rests upon the 10
fundamental tenet that „public office is a public trust.‰
There is thus no cogent reason to treat plunder any
different from the cases of bribery or dereliction of public
duty for purposes of RA 1405.
The petitioner next contends 11
that Gancayco and Banco
Filipino Savings v. Purisima, insofar as they expounded
Section 8 of RA 3019 are not applicable to his case. He
reasons that in these cases, when the subpoenas subject
thereof were issued, the text of Section 8 of RA 3019
provided that: „x x x Properties in the name of the spouse
and unmarried
_______________
8 122 Phil. 503; 15 SCRA 91 (1965).

9 Id., at p. 96.
10 Section 1, Article XI of the 1987 Constitution.
11 L-56429, May 28, 1988, 161 SCRA 576.
272


children of such public official may be taken into

consideration x x x. Bank deposits shall be taken into
consideration in the enforcement of this section,
notwithstanding any provision of law to the contrary
notwithstanding.‰
On the other hand, Section 8 of RA 3019, as presently
worded upon its amendment by Batas Pambansa Blg. 195
on March 16, 1986, reads:
„SEC. 8. Prima facie evidence of and dismissal due to unexplained

wealth.·If in accordance with the provisions of Republic Act
Numbered One thousand three hundred seventy-nine, a public
official has been found to have acquired during his incumbency,
whether in his name or in the name of other persons, an amount of
property and/or money manifestly out of proportion to his salary
and to his other lawful income, that fact shall be a ground for
dismissal or removal. Properties in the name of the spouse and
dependents of such public official may be taken into consideration,
when their acquisition through legitimate means cannot be
satisfactorily shown. Bank deposits in the name of or manifestly
excessive expenditures incurred by the public official, his spouse or
any of their dependents including but not limited to activities in
any club or association or any ostentatious display of wealth
including frequent travel abroad of a non-official character by any
public official when such activities entail expenses evidently out of
proportion to legitimate income, shall likewise be taken into
consideration in the enforcement of this section, notwithstanding
any provision of law to the contrary. The circumstances hereinabove
mentioned shall constitute valid ground for the administrative
suspension of the public official concerned for an indefinite period
until the investigation of the unexplained wealth is completed.‰
The petitioner theorizes that prior to the amendment, the

following may be taken into consideration in the
enforcement of Section 8 of RA 3019:
„c) properties in the name of the spouse and unmarried

children of the public official; and
273

VOL. 509, NOVEMBER 30, 2006 273

12
d) bank deposits (without any qualification by law).‰
After its amendment on March 16, 1982, the following may

allegedly be taken into consideration in the enforcement of
Section 8 of RA 3019:
„c) properties in the name of the spouse and

dependents of the public official; and
d) bank deposits in the name of the public
13
official, his
spouse or any of their dependents.‰
According to the petitioner, although he is the son of former

President Estrada, he is absolutely not his dependent.
Petitioner avers that he is in his own right a legitimate
businessman having investments in several entities when
he opened the subject accounts in Urban Bank, now Export
and Industry Bank. Further, he is also the Municipal
Mayor of San Juan, Manila. He thus urges the Court
against applying the rulings in Gancayco and Banco
Filipino in the light of the amendment of Section 8 of RA
3019.
The petitionerÊs contention is equally unpersuasive. It
should be recalled that the petitioner in Banco Filipino
posited that the inquiry into illegally acquired property
should be restricted to property held by or in the name of
the government official or employee or his spouses and
unmarried children. The Court rejected this argument as it
pronounced that:
„To sustain the petitionerÊs theory, and restrict the inquiry only to
property held by or in the name of the government official or
employee, or his spouse and unmarried children is unwarranted in
the light of the provisions of the statutes in question, and would
make available to persons in government who illegally acquired
property an easy and fool-proof means of evading investigation and
prosecution; all they would have to do would be to simply place the
property in the possession or name of persons other than their

_______________
12 Supra note 4, at pp. 44-45.

13 Id.
274

spouse and unmarried children. This is an absurdity that we will

14
not ascribe to the lawmakers.‰
At this point, it is well to mention that based on the

evidence presented by the prosecution before the
Sandiganbayan, hundreds of millions of pesos flowed from
the petitionerÊs Trust Account No. 858 to the alleged Jose
Velarde account purportedly maintained by former
President Estrada at Equitable PCIBank. In fact, one
managerÊs check, marked as Exhibit „L‰ for the
prosecution, in the amount of P107,191,780.85 was drawn
from, and funded by the said trust account of petitioner JV
Ejercito.
Considering the mind-boggling sums of money that
flowed out of the petitionerÊs Trust Account No. 858 and its
nexus to former President EstradaÊs alleged Jose Velarde
account, it is logical for the prosecution to pursue the
theory that the money in the said trust account forms part
of the unexplained wealth of the latter. As such, the money
in the accounts of the petitioner may be properly
considered as „subject matter‰ of the plunder cases falling
under number (6) of the enumerated exceptions to the
absolute confidentiality of bank deposits.
Viewed in this context, the petitionerÊs assertion that
since he is no longer a dependent of his father, then the
rulings in Gancayco and Banco Filipino are not applicable
to his case is, to say the least, quite lame. In fact, to sustain
his theory would, as the Court stated in Banco Filipino,
„make available to persons in government who illegally
acquired property an easy and fool-proof means of evading
investigation and prosecution; all they would have to do
would be to simply place the property in the possession or
name of persons other than their spouse and unmarried

children. This is15 an absurdity that we will not ascribe to

the lawmakers.‰
The petitioner bewails the „extremely-detailed‰
information contained in the Special Prosecution PanelÊs
requests for the
_______________
14 Supra note 11, at p. 582.

15 Id.
275
VOL. 509, NOVEMBER 30, 2006 275

subpoenae duces tecum/ad testificandum. The information

upon which the requests were based was allegedly illegally
and improperly obtained.
The petitioner opines that there had been prior
disclosure by the bank and its personnel of data and
information relative to his trust and savings accounts
considering the very detailed information contained in the
request for the subpoenas, to wit:
a) Trading Order No. 020385 dated January 29, 1999;

b) Confirmation Advice TA 858;
c) Trust Agreement dated January 1999;
d) Special Private Account No. (SPAN) 858;
e) Savings Account No. 0116-17345-9;
f) Letter of authority dated November 23, 1999 re:
SPAN 858;
g) Letter of authority dated January 29, 2000 re:
SPAN 858;
h) Letter of authority dated April 24, 2000 re: SPAN
858;
i) Urban Bank check no. 052092 dated April 24, 2000
for the amount of P36,572,315.43;
j) Urban Bank check no. 052093 dated April 24, 2000
the amount of P107,191,780.85.

According to the petitioner, the bank officials and personnel

are criminally liable for releasing, without his knowledge,
consent and authorization, information relative to his
accounts to the prosecution. Further, since the information
used to support the requests for the subpoenas was not
secured by court order, such information was illegally
acquired and the requests for subpoenas containing the
said illegally acquired information are already a direct
violation of RA 1405. Consequently, such illegally acquired
information cannot be used in any proceeding. He invokes
the constitutional provision on the right of the people to be
secure in their persons, houses, papers and effects against
unreasonable searches and seizures of whatever nature
and purpose and that any evidence
276

obtained 16in violation thereof shall be inadmissible in

evidence.
The petitioner cites the following pronouncement of the
Court in Marquez:
„Zones of privacy are recognized and protected in our laws. The

Civil Code provides that „[e]very person shall respect the dignity,
personality, privacy and peace of mind of his neighbors and other
persons‰ and punishes as actionable torts several acts for meddling
and prying into the privacy of another. It also holds a public officer
or employee or any private individual liable for damages for any
violation of the rights and liberties of another person, and
recognizes the privacy of letters and other private communication.
The Revised Penal Code makes a crime of the violation of secrets by
an officer, the revelation of trade and industrial secrets, and
trespass to dwelling. Invasion of privacy is an offense in special
laws like the AntiWiretapping Law, the Secrecy of Bank Deposits
17
Act, and the Intellectual Property Code.‰
_______________
16 Sections 2 and 3, Article III of the Constitution read;

SEC. 2. The right of the people to be secure in their persons, houses, papers,
and effects against unreasonable searches and seizures of whatever nature and
for any purpose shall be inviolable, and no search warrant or warrant of arrest
shall issue except upon probable cause to be determined personally by the
judge after examination under oath or affirmation of the complainant and the
witnesses he may produce, and particularly describing the place to be searched
and the persons and things to be seized.
SEC. 3. (1) The privacy of communication and correspondence shall be
inviolable except upon lawful order of the court, or when public safety or order
requires otherwise as prescribed by law.
(2) Any evidence obtained in violation of this or the preceding section shall
be inadmissible for any purpose in any proceeding.
17 Supra note 3, at pp. 398-399; p. 782.
277
VOL. 509, NOVEMBER 30, 2006 277

A review of the incidents related to the present case will

show why the petitionerÊs reliance on Marquez is
misplaced. In the said case, the Office of the Ombudsman
issued a subpoena addressed to Marquez, a bank officer of
Union Bank, directing her to bring several bank documents
for in camera inspection in connection with an
investigation being conducted by the Office of the
Ombudsman.
Marquez refused to comply with the said directive and
sought recourse to the Court by filing a petition and raising
therein the issue of whether the order of the Office of the
Ombudsman to have an in camera inspection of the
questioned account was allowed as an exception to the law
on secrecy of bank deposits. 18
According to the Court, notwithstanding Section 15(8)
of RA 6770 (The Ombudsman Act), „before an in camera
inspection may be allowed, there must be a pending case
before a court of competent jurisdiction. Further, the
account must be clearly identified, the inspection limited to
the subject matter of the pending case before the court of
competent jurisdiction. The bank personnel and the
account holder must be notified to be present during the

inspection, and such inspection19may cover only the account

identified in the pending case.‰
Marquez was promulgated by the Court on June 27,
2001. However, as early as February 8, 2001 or before the
promulgation of Marquez, the Office of the Ombudsman,
relying on
_______________
18 Section 15 (8) of RA 6770 reads:
SEC. 15. Powers, Functions and Duties.·The Office of the Ombudsman shall
have the following powers, functions and duties:
xxxx
(8) Administer oaths, issue subpoena and subpoena duces tecum and take
testimony in any investigation or inquiry, including the power to examine and
have access to bank accounts and records;
19 Supra note 3, at p. 397; p. 781.
278

Section 15(8) of RA 6770 and on the basis of information

obtained during the impeachment proceedings of former
President Estrada, issued a subpoena addressed to Urban
Bank. The documents sought under the subpoena
pertained to numbered accounts 727, 737, 747, 757 and 858
allegedly in the names of Jose Velarde, Joseph E. Estrada,
Laarni Enriquez, Guia Gomez, Joy Melendrez, Peachy
Osorio, Rowena Lopez, Kevin or Kelvin Garcia.
In compliance with the said subpoena, the PDIC, as then
receiver of Urban Bank, issued a certification on February
13, 2001, as to the availability of bank documents relating
to A/C 858 and T/A 858 and the non-availability of bank
records as to the other accounts named in the subpoena.
Based on the PDIC certification, the Office of the
Ombudsman issued on February 16, 2001 another
subpoena directing the production of documents pertinent
to accounts A/C 858 and T/C 858. The PDIC again complied
and furnished the Office of the Ombudsman on February
21, 2001 certified copies of the following documents:
„1. Transaction registers dated 7-02-99, 8-16-99, 9-17-99, 1018-

99, 11-22-99,1-07-00, 01-17-00, 04-03-00 and 04-24-00;
2. Report of Unregularized TAFs & DTs For UR COIN A & B
Placements of Various Branches as of February 29, 2000
and as of December 16, 1999; and
Trading Order A No. 07125 is filed in two copies·a white
copy which showed „set up‰ information; and a yellow copy
which showed „reversal‰ information. Both copies have been
reproduced and are enclosed with this letter.
We are continuing our search for other records and documents

pertinent to your request and we will forward to you on Friday, 23
February 2001, such additional records and documents as we might
20
find until then. (Attachment „4‰)‰
_______________
20 Memorandum of respondent People, pp. 63-64.
279
VOL. 509, NOVEMBER 30, 2006 279

Upon the request of the Office of the Ombudsman, the

PDIC furnished the said office copies of the managerÊs
checks. With respect to the other documents described by
petitioner JV Ejercito as „extremely-detailed,‰ the Special
Prosecution Panel explains how they came to know about
these documents in this manner:
„What is more, Attachment „2-a,‰ the compliance letter from the

PDIC, specifically mentioned, as among the documents transmitted
thereby, a LIST (Attachment „2-B‰) pertaining to the documents
available in connection with Account No. 858, which list and
documents (listed therein) were furnished the Office of the
Ombudsman:
In compliance with the Subpoena Duces Tecum dated February 8, 2001

issued by the Office of the Ombudsman, transmitted are:

1. Certification on available bank documents relating to A/C 858 and
T/A 858 contained in a list attached thereto x x x (emphasis
supplied)
There is a list, therefor, apart from the documents themselves

(furnished the Office of the Ombudsman) to which said list is
attached, from which details can be lifted. Thus, as to Trading
Order No. 020385 dated January 29, 1999, it must be noted that
it is the second item in the list (Attachment „2-b‰ hereof) under
document no. A-2. It is also among the documents furnished by the
PDIC.
As to Confirmation Advice TA 858, it must be noted that this
is a specific but not detailed document being sought in the subpoena
regarding Account No. 858, in general. For those familiar with
banking practice, such is an expected document of course, or one
issued in the course of placements since it has been previously
established that Account No. 858 is a Trust Account. A confirmation
advice, therefore, is a reasonable and expected document to be
found in trust accounts to evidence participation in specific
amounts. A sample of said confirmation advice, in the amount of
P200 Million, and which is among the documents officially
furnished the Office of the Ombudsman during the investigation
leading to the charge for plunder against former President Joseph
Estrada, et al., is attached as Attachment „36.‰
Further, the list (Attachment „2-b‰ hereof) enumerates a number
of confirmation advices sufficient for the plaintiff to ask for the
280

same in the instant subpoena. However, as earlier explained, even

in the absence of such a list, any person could reasonably expect
such a document in Trust Account No. 858 to evidence participation.
As to the Trust Agreement dated January 1999, since the
account had been established as a Trust Account, it is reasonable to
presume and expect that there is such a Trust Agreement on or
about January 1999, coinciding with the date of the Trading Order,
existing in the records.
Surely, this needs no stretch of imagination to reckon that such a

document should exist in a truth account.

As to Special Private Account No. (SPAN) 858, SPAN 858 is
yet another detail derived from a study of the documents and list
furnished by the PDIC to the Office of the Ombudsman. For
example, document no. C-2 in the list would yield a Trading Order
No. 046352 for P40 Million with the customer being identified as
SPAN 858.
As to Savings Account No. 0116-17345-9, again, among the
documents furnished by the receiver of Urban Bank to the Office of
the Ombudsman pursuant to its constitutional powers is a copy of
the Specimen Signature Card for SPAN 858, opened on March 9,
1999 under Account No. 0116-17345-9. It must be emphasized that
Account No. 0116-17345-9 is an entry in the said document.
As to the Letter of Authority dated November 23, 1999 re:
SPAN 858, it is document no. E-3 in the list.
It must be emphasized that this letter of authority dated
November 23, 1999 authorized the release of more than P100
Million worth of managerÊs checks, where the ultimate recipient,
for its deposit to the Jose Velarde account was, Baby Ortaliza. It
must be recalled that prosecution witnesses Teresa Barcelona and
Glyzelyn H. Bejec testified that it was Ortaliza who deposited the
managerÊs checks subject of the letter of authority dated November
23, 1999 to the Jose Velarde account via Equitable PCIBank
Greenhills Branch.
It must be recalled that plaintiff has presented voluminous
evidence to establish beyond any doubt that Lucena „Baby‰ Ortaliza
worked for accused Joseph Estrada in the Office of the Vice
President, as testified to by prosecution witness Remedios Aguilar
of the Office of the Vice President. The same fact is also shown by
Exhibits „Y5,‰ „Z5,‰ „A6‰ (OrtalizaÊs appoint papers designating her
as VicePresidential Staff Officer II signed by then Vice President
Jose
281
VOL. 509, NOVEMBER 30, 2006 281

Estrada), „B6‰ (Certification of Employment), „C6‰ (Oath of Office),

„D6‰ (Position Description Form), „E6‰ (Notice of Salary Adjustment)
„F6‰ (Certification) and „G6‰ (Personal Data Sheet). Ortaliza also
worked for accused Joseph Estrada at the Office of the President as

testified to by witness Lita Sison of the Office of the President and

as proved by Exhibits „I6‰ (Master Personnel Records File), „H6‰
(Registration letter of Ortaliza from the Office of the President), „J6‰
(Personnel Assessment Form), „K6‰ (appointment papers
designating her as Presidential Staff Officer VI, Internal House,
signed by then President Joseph Estrada), „L6‰ (Oath of Office),
„M6‰ (Certification of Employment), „N6‰ (Position Description
Form), „O6‰ (Personal Data Sheet) and „P6‰ (OrtalizaÊs public
service record). The same „Baby‰ Ortaliza also transacted on behalf
of former President Joseph Estrada with respect to his personal
bank accounts. Indeed, Baby Ortaliza, as testified to by numerous
prosecution witnesses and as shown by the documents they
identified, is also the same person who transacted with Equitable
PCIBank in connection with the Jose Velarde account and with
Citibank in connection with the conjugal bank account of former
President Joseph Estrada and Sen. Luisa Ejercito wherein the P8
Million check of Gov. Luis „Chavit‰ Singson was deposited. In
addition to the foregoing and the testimonies of Clarissa Ocampo
and Manuel Curato of Equitable PCIBank, the documents relating
to Trust Account No. 858, thus, constitute further proof that
accused Joseph Estrada is Jose Velarde.
Indeed, the surfacing of the name Baby Ortaliza in this
Account No. 858 and her participation herein, coupled with
the previous evidence presented as to who she worked for,
all the more make Trust Account No. 858 not only relevant
and material, but also the very subject matter of litigation in
the instant case. Indeed, her participation herein more than
establishes a pattern of behavior, a custom, a modus
operandi among accused Joseph Estrada, herself and the
other co-accused in appearing for, representing, accused
Joseph Estrada and transacting with respect to his bank
accounts.
As to Letter of Authority dated January 17, 2000 re SPAN
858, it is document no. E-4 in the list.
As to Letter of Authority dated April 24, 2000 re: SPAN 858,
it is document no. E-5 in the list.
As to Urban Bank Check No. 052093 dated April 24, 2000 in
the amount of P36,572,315.43 and Urban Bank Check No.
282

052093 dated April 24, 2000 in the amount of P107,191,780.85,

the foregoing details were culled from the contents of the letter of
authority dated April 24, 2000. Indeed, said letter of authority
authorizes the issuance of managerÊs checks in accordance with the
details therein provided:
1) AMOUNT :PHP107,191,780.85
DATE :APRIL 24, 2000
PAYEE :CASH
MC # :052093
2) AMOUNT :PHP36,572,315.43
DATE :APRIL 24, 2000
PAYEE :CASH
MC# :052092
It must be emphasized that the foregoing details were adopted in

seeking for the production of the two (2) Urban Bank managerÊs
21
checks.‰
As shown by the Special Prosecution Panel, some of the

details about the accounts of petitioner JV Ejercito were
obtained from various sources gathered during the
impeachment proceedings against former President
Estrada. The various sources included reports, articles and
investigative journals, which are legitimate sources.
The other details were gathered upon compliance by the
PDIC and/or Urban Bank with the subpoenas issued by the
Office of the Ombudsman prior to the promulgation by the
Court of Marquez. The Office of the Ombudsman, in issuing
the subpoenas relied on Section 15(8) of RA 6770 giving it
the power „to issue subpoena and subpoena duces tecum
and take testimony in any investigation or inquiry,
including the power to examine and have access to bank
accounts and records.‰
The Marquez ruling, it bears reiterating, came after the
subpoenas were issued by the Office of the Ombudsman
and the PDIC and Urban Bank had already complied
therewith by furnishing it the necessary information. The
said information

_______________
21 Memorandum of respondent People, pp. 66-72.
283
VOL. 509, NOVEMBER 30, 2006 283

cannot thus be considered „illegal‰ because Marquez, which

applied and interpreted the power of the Office of the
Ombudsman under Section 15(8) of RA 6770, cannot be
given retroactive22
application. In Filoteo, Jr. v.
Sandiganbayan, the Court emphasized that „judge-made‰
laws are to be applied prospectively:
„The prospective application of „judge-made‰ laws was underscored

in Co v. Court of Appeals where the Court ruled thru Chief Justice
Andres R. Narvasa that in accordance with Article 8 of the Civil
Code which provides that „(j)udicial decisions applying or
interpreting the laws or the Constitution shall form part of the legal
system of the Philippines,‰ and Article 4 of the same Code which
states that „(l)aws shall have no retroactive effect unless the
contrary is provided,‰ the principle of prospectivity of statutes,
original or amendatory, shall apply to judicial decisions, which,
although in themselves are not laws, are nevertheless evidence of
23
what the law means.‰
Contrary to the petitionerÊs contention, therefore, the

„extremely-detailed‰ information of the Office of the
Ombudsman on which it based its requests for subpoenae
duces tecum/ad testificandum can hardly be characterized
as „illegal.‰ In any case, even if Marquez were to be given
retroactive application, still, the crux of the CourtÊs ruling
in the said case has no application to the present case. In
Marquez, the Court disallowed the Ombudsman from
conducting an in camera inspection of the bank account
because „there was no pending case in court which would
warrant the opening of the bank account for inspection.‰
On the other hand, it is indubitable that in the present
case, the plunder and illegal use of alias cases against
former President Estrada are pending before the
Sandiganbayan and, unlike in Marquez, the Special
Prosecution Panel has asked leave of court in accordance

with RA 1405 for the pro-
_______________
22 331 Phil. 531; 263 SCRA 222 (1996).

23 Id., at pp. 573-574; p. 260. Citations omitted.
284

duction of the said documents. Consequently, the

subpoenae duces tecum/ad testificandum issued by the
Sandiganbayan are allowable exceptions to the bank
secrecy laws as they properly fall under the following
categories in Section 2 thereof:
„(5) Upon order of a competent court in cases of bribery

or dereliction of duty of public officials; or
(6) In cases where the money deposited 24
or invested is
the subject matter of litigation.‰
Finally, the petitioner has sought to suppress the

„extremely-detailed‰ information that the Special
Prosecution Panel has requested. He invokes his
constitutional right against unreasonable search and
seizures and that any evidence obtained in violation thereof
shall be inadmissible in evidence. In her concurring and
dissenting opinion, Mme. Justice Angelina Sandoval-
Gutierrez agrees with petitioner JV Ejercito as she
supports his plea to quash the subpoenae duces tecum/ad
testificandum issued by the Sandiganbayan characterizing
them as „unreasonable and oppressive‰ for being based on
information allegedly obtained in violation of his
constitutional right to privacy.
To my mind, the application of the exclusionary rule or
the „fruit of the poisonous tree‰ doctrine is not warranted
in the present case not only because, as discussed earlier,
there is no „illegally obtained evidence‰ to speak of but also
because nowhere is it stated in RA 1405, and even in

Marquez, that a violation thereof warrants application of

the exclusionary rule. Section 5 of RA 1405 provides that
„[a]ny violation of this law will subject the offender upon
conviction, to an imprisonment of not more than five years
or a fine of not more than twenty thousand pesos or both,
in the discretion of the court.‰
_______________
24 Supra note 6.
285
VOL. 509, NOVEMBER 30, 2006 285

Interestingly,
25
the United States has the Bank Secrecy Act
(BSA). However, unlike RA 1405, the US BSA was
precisely enacted by the US Congress as a means of
providing federal law investigators with an effective tool to
fight criminal financial activity:
„The conclusion reached by Congress in the early hearings was

summarized by Robert Morgenthau, U.S. Attorney, Southern
District of New York, „Secret numbered foreign bank accounts have
become an ever increasing widespread and versatile tool for the
evasion of our laws and regulations and for the commission of
crimes by American citizens and for hiding the fruits of crimes
already committed.
This wave of criminal activity is fostered by the failure of fairly
complete criminal investigations to ripen into prosecutions because
there has been no disclosure of the real parties in interest;
investigators cannot point to any particular individual. Even if
identity is revealed, the evidence remains inadmissible hearsay.
Most modern secrecy law prohibits the banker from coming forth
with the disclosure. Thus, the prosecution lacks the competent and
qualified business representative who could state evidence of
account information as a business records exception to the hearsay
rule.
In response to the public outcry over this reported criminal
activity and as a means of providing federal law investigators with
an effective investigative tool, Congress enacted the Bank Secrecy

26
Act (BSA).‰
The important feature of the BSA is its regulatory

structure that is designed to be used as an investigative
tool in the fight against white collar crime, and its passage
is a broad delegation of commerce power to the Treasury
Department. Title I thereof authorizes the Secretary of the
Treasury De-
_______________
25 12 U.S.C. §§ 1730d, 1829b, 1951-1959 (1982); 31 U.S.C. §§ 5311-

5322 (1982), as amended by 31 U.S.C.A. §§ 5316 (a), 5317(c), 5323 (West
Supp. 1985).
26 Eldridge, The Bank Secrecy Act; Privacy, Comity, and the Politics of
Contraband, 11 N.C.J IntÊl L. & Com. Reg. 667 (Summer, 1986).
286

partment to require financial institutions to record vast

amounts of information on financial transactions. Title II
provides a regulatory access to information via required
reporting by the financial institutions and expressly
authorized governmental
27
interagency exchange of the
accessed information. 28
In California Bankers Association v. Schulz, the US
Supreme Court held that the BSA is a constitutionally
valid and
29
proper regulatory device. In United States v.
Miller, the US Supreme Court reaffirmed its stance by
holding that government access to a customer account
records is not an unreasonable search and seizure even if
realized through defective legal process and without
customer notification.
Miller was convicted of operating an illegal still,
functioning as a distiller without having posted bond, and
committing tax evasion. The convictions were based on
evidence subpoenaed pursuant to the BSA. Miller moved to
suppress the bank records on the grounds that they were
obtained by means of a defective subpoena duces tecum

which resulted in a seizure violative of the fourth

amendment.
The US Supreme Court held that Miller had no
„protectable‰ fourth amendment interest in the subpoenaed
documents. Justice Powell, speaking for the US Supreme
Court, reasoned that the subpoenaed documents were not
MillerÊs „private papers‰ and that he could assert neither
ownership nor possession. Rather, these were the business
records of the bank.
The said Court also debunked MillerÊs claim that he had
a legitimate „expectation of privacy‰ concerning the
contents of the bank documents, e.g., checks and deposit
slips:
_______________
27 Id., at p. 672.
28 416 US 21 (1974).
29 425 US 435 (1976).
287
VOL. 509, NOVEMBER 30, 2006 287

ÂEven if we direct our attention to the original checks and deposit

slips, rather than to the microfilm copies actually viewed and
obtained by means of the subpoena, we perceive no legitimate
„expectation of privacy‰ in their contents. The checks are not
confidential communications but negotiable instruments to be used
in commercial transactions. All of the documents obtained,
including financial statements and deposit slips, contain only
information voluntarily conveyed to the banks and exposed to their
employees in the ordinary course of business. The lack of any
legitimate expectation of privacy concerning the information kept in
bank records was assumed by Congress in enacting the Bank
Secrecy Act, the express purpose of which is to require records to be
maintained because they „have a high degree of usefulness in
criminal tax, and regulatory investigations and proceedings.‰
The depositor takes the risk, in revealing his affairs to another,
that the information will be conveyed by that person to the
Government. The Court has held repeatedly that the Fourth

Amendment does not prohibit the obtaining of information revealed

to a third party and conveyed by him to Government authorities,
even if the information is revealed on the assumption that it will be
used only for a limited purpose and the confidence placed in the
30
third party will not be betrayed.Ê
Because the customer had no „protectable‰ fourth

amendment rights, according to the US Supreme Court,
the case was controlled by the general rule that a subpoena
issued to a third party, for that partyÊs records, does not
violate the rights of the third partyÊs client.
Largely in response to Miller and California Bankers,
the US Congress enacted31
the Right to Financial Privacy
Act of 1978 (RFPA). It enumerates the legal processes
available for federal agency access to customerÊs account
information. Access is conditioned upon one 32
of the following
procedures: customer33 authorization, administrative
subpoena or summons,
_______________
30 Id., at pp. 442-443.

31 12 U.S.C. §§ 3401-3422.
32 Id. § 3404.
33 Id. § 3405.
288

34 35
search warrant,
36
judicial subpoena, 37 grand jury
subpoena, or formal written agency request.
Case law provides, however, that a violation of the
procedures set forth in RFPA does not warrant exclusion of
the evidence obtained because courts should not imply a
suppression remedy unless the statute expressly refers to
the exclusionary rule. The RFPA states that civil 38
penalties
are the only authorized
39
remedy for its violation. In United
States v. Frazin, for example, Frazin and Miller were
charged with mail and wire fraud. During its investigation,
banks furnished the Federal Bureau of Investigation (FBI)

information about the account of Frazin without his

knowledge or consent and without warrant. Frazin sought
to suppress the bank records and other information
obtained in violation of RFPA. The United States Court of
Appeals, Ninth Circuit, held against Frazin ratiocinating
that had Congress intended to authorize a suppression
remedy, it surely would have included it among the
remedies it expressly authorized. The said US appellate
court likewise refused to suppress the financial evidence
pursuant to its supervisory powers over the administration
of justice. It opined that „because the statute, when
properly construed, excludes a suppression remedy, it
would not be appropriate for us to provide one in the
exercise of our supervisory powers over the administration
of justice. Where Congress has both established a right and
provided exclusive remedies for its violation, we would
encroach upon the prerogatives of Congress where we to
authorize a remedy not provided for by the statute.‰
_______________
34 Id. § 3406.
35 Id. § 3407.
36 Id. § 3420.
37 Id. § 3408.
38 12 U.S.C. § 3417(d).
39 780 F.2d 1461 (1986).
289
VOL. 509, NOVEMBER 30, 2006 289

The said ruling in Frazin was reiterated by the US Court40 of

Appeals, Second Circuit, in United States v. Daccarett, a
civil forfeiture proceeding instituted by the United States
Government against monies of Cali cartel, a Colombian
conglomerate headed by Jose Santacruz-Londono, which
allegedly imported 3000 kilograms of cocaine a month into
the US. The cartel allegedly used bank accounts
throughout the US, Europe, Central and South America to
store and move its narcotic proceeds. Funds were moved

through various international banks by means of electronic

fund transfers for ultimate deposit into Colombian bank
accounts.
Several associates of Santacruz-Londono were arrested
in Luxembourg. Anticipating that the arrests would trigger
an effort by the cartel to move its monies to Colombia, the
Luxembourg law enforcement authorities requested the
assistance of several countries to freeze monies related to
the cartel. The US Drug Enforcement Agency (DEA)
instructed intermediary banks in New York to attach „all
funds‰ on deposit in the names of entities and individuals
connected with Santacruz-Londono. The DEA also
subpoenaed from the intermediary banks financial records
of related accounts.
The entities and individuals who claimed to be the
beneficiaries of the seized funds argued, among others, that
their fourth amendment rights against unreasonable
searches and seizures were violated when the government
gained access to their financial records from the
intermediary banks without a warrant. They contended
that evidence obtained from the subpoenas should have
been suppressed at trial. The US appellate court, in
rejecting this argument, cited Frazin and succinctly held
that „because the RFPA states that civil penalties are the
only authorized remedy for its violation, it would be
inappropriate for the courts to imply a suppression remedy
as well.‰
_______________
40 6 F.3d 37 (1993).
290

41
Also in United States v. Thompson, the US Court of
Appeals, Eleventh Circuit, made the following disquisition:
„x x x [T]he defendant would have to show that Congress had

provided such a remedy for a violation of the statute, either

specifically or by inference. Clearly Congress intended to place

limits on the GovernmentÊs ability to monitor the private activities
of individuals when it passed this statute. Congress did not,
however, suggest that any information obtained in violation of the
statuteÊs provisions should be excluded. Instead the statute only
provides for fines and possible imprisonment for knowing violations.
When Congress specifically designates a remedy for one of its acts,
courts generally presume that it engaged in the necessary balancing
of interests in determining what the appropriate penalty should be.
Absent a specific reference to the exclusionary rule, it is not
42
appropriate for the courts to read such a provision into the act.‰
Under prevailing jurisprudence in the United States

therefore, violations of the RFPA do not warrant the
application of the exclusionary rule with respect to the
evidence obtained.
Nonetheless, in the present case, there is no violation of
RA 1405 precisely because petitioner JV EjercitoÊs case
properly falls under the recognized exceptions to the rule
on confidentiality of bank deposits. Further, the Special
Prosecution Panel has properly requested the
Sandiganbayan for the issuance of the subpoenae duces
tecum/ad testificandum for the production of documents
relating to the bank accounts of petitioner JV Ejercito in
connection with the plunder and illegal use of alias cases
against former President Estrada. The Sandiganbayan, in
issuing the assailed resolutions, clearly committed no grave
abuse of discretion.
ACCORDINGLY, I vote to DISMISS the petition.
Petition dismissed.
_______________
41 936 F.2d 1249 (1991).

42 Id., at p. 1251.
291
VOL. 509, NOVEMBER 30, 2006 291

Notes.·Sec. 10, Rule 57 of the Rules of Court is not

incompatible with the R.A. 1405, the Bank Secrecy Law.

(Oñate vs. Abrogar, 230 SCRA 181 [1994])
The legislative declaration in R.A. No. 7659 that plunder
is a heinous offense implies that it is a malum in se. For
when the acts punished are inherently immoral or
inherently wrong, they are mala in se and it does not
matter that such acts are punished in a special law,
especially since in the case of plunder the predicate crimes
are mainly mala in se. (Estrada vs. Sandiganbayan, 369
SCRA 394 [2001])
Where the accounts in question are U.S. dollar deposits,
the applicable law is R.A. No. 6426, not R.A. No. 1405.
(Intengan vs. Court of Appeals, 377 SCRA 63 [2002])
··o0o··
292
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SUPREME COURT REPORTS ANNOTATED VOLUME 509 1/19/22, 9:06 PM

190 SUPREME COURT REPORTS ANNOTATED

JOSEPH VICTOR G. EJERCITO, petitioner, vs.

Banks and Banking; Secrecy of Bank Deposits Act (Republic Act

VOL. 509, NOVEMBER 30, 2006 191

Ejercito vs. Sandiganbayan (Special Division)

persons, then such account, regardless of whether it creates a

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192 SUPREME COURT REPORTS ANNOTATED

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Ejercito vs. Sandiganbayan (Special Division)

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VOL. 509, NOVEMBER 30, 2006 193

Ejercito vs. Sandiganbayan (Special Division)

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would be encroaching upon the prerogatives of Congress were they to

194 SUPREME COURT REPORTS ANNOTATED

Ejercito vs. Sandiganbayan (Special Division)

fails. R.A. 1405, it bears noting, nowhere provides that an unlawful

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„fruit of the poisonous tree‰ doctrine presupposes a violation of law·

VOL. 509, NOVEMBER 30, 2006 195

Ejercito vs. Sandiganbayan (Special Division)

the old doctrine and acted in good faith.·For the Ombudsman

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before a court of competent jurisdiction,‰ it was, in fact, reversing

196 SUPREME COURT REPORTS ANNOTATED

Ejercito vs. Sandiganbayan (Special Division)

tions outlined in Morales and Galit have no retroactive effect

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presume that the information was obtained in violation of R.A. No.

SANDOVAL-GUTIERREZ, J., Dissenting Opinion:

Banks and Banking; Secrecy of Bank Deposits Act (R.A. No.

VOL. 509, NOVEMBER 30, 2006 197

Ejercito vs. Sandiganbayan (Special Division)

deposits and bond investments would counterbalance immeasurably

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make up the crime of plunder are categorized as exceptions to the

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198 SUPREME COURT REPORTS ANNOTATED

Ejercito vs. Sandiganbayan (Special Division)

„may not be examined, inquired or looked into by any

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VOL. 509, NOVEMBER 30, 2006 199

Ejercito vs. Sandiganbayan (Special Division)

cess to information without invocation of the judicial

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200 SUPREME COURT REPORTS ANNOTATED

Ejercito vs. Sandiganbayan (Special Division)

mez, Joy Melendrez, Peachy Osorio, Rowena Lopez, Kevin or

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Same; Same; Same; Same; Same; Same; Something is

VOL. 509, NOVEMBER 30, 2006 201

Ejercito vs. Sandiganbayan (Special Division)

CALLEJO, SR., J., Concurring Opinion:

Criminal Law; Plunder; Public Officers; It can be readily

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family or close associates; a plain reading of the definition of

202 SUPREME COURT REPORTS ANNOTATED