SECOND DIVISION

[G.R. No. 128996. February 15, 2002]

CARMEN LL. INTENGAN, ROSARIO LL. NERI, and RITA P. BRAWNER, petitioners, vs.
COURT OF APPEALS, DEPARTMENT OF JUSTICE, AZIZ RAJKOTWALA, WILLIAM
FERGUSON, JOVEN REYES, and VIC LIM, respondents.

DECISION

DE LEON, JR., J.:

Before us is a petition for review on certiorari, seeking the reversal of the Decision [1] dated July
i

8, 1996 of the former Fifteenth Division [2] of the Court of Appeals in CA-G.R. SP No. 37577 as
ii

well as its Resolution [3] dated April 16, 1997 denying petitioners’ motion for reconsideration.
iii

The appellate court, in its Decision, sustained a resolution of the Department of Justice ordering
the withdrawal of informations for violation of Republic Act No. 1405 against private
respondents.

The facts are:

On September 21, 1993, Citibank filed a complaint for violation of section 31, [4] in relation to
iv

section 144 [5] of the Corporation Code against two (2) of its officers, Dante L. Santos and
v

Marilou Genuino. Attached to the complaint was an affidavit [6] executed by private respondent
vi

Vic Lim, a vice-president of Citibank. Pertinent portions of his affidavit are quoted hereunder:

2.1 Sometime this year, the higher management of Citibank, N.A. assigned me to assist in the
investigation of certain anomalous/highly irregular activities of the Treasurer of the Global
Consumer Group of the bank, namely, Dante L. Santos and the Asst. Vice President in the office
of Mr. Dante L. Santos, namely Ms. Marilou (also called Malou) Genuino. Ms. Marilou Genuino
apart from being an Assistant Vice President in the office of Mr. Dante L. Santos also performed
the duties of an Account Officer. An Account Officer in the office of Mr. Dante L. Santos
personally attends to clients of the bank in the effort to persuade clients to place and keep their
monies in the products of Citibank, NA., such as peso and dollar deposits, mortgage backed
securities and money placements, among others.

xxx xxx xxx

4.1 The investigation in which I was asked to participate was undertaken because the bank
had found records/evidence showing that Mr. Dante L. Santos and Ms. Malou Genuino, contrary
to their disclosures and the aforementioned bank policy, appeared to have been actively engaged
in business endeavors that were in conflict with the business of the bank. It was found that with
the use of two (2) companies in which they have personal financial interest, namely Torrance
Development Corporation and Global Pacific Corporation, they managed or caused existing bank
clients/depositors to divert their money from Citibank, N.A., such as those placed in peso and
dollar deposits and money placements, to products offered by other companies that were
commanding higher rate of yields. This was done by first transferring bank clients’ monies to
Torrance and Global which in turn placed the monies of the bank clients in securities, shares of
stock and other certificates of third parties. It also appeared that out of these transactions, Mr.
Dante L. Santos and Ms. Marilou Genuino derived substantial financial gains.

5.1 In the course of the investigation, I was able to determine that the bank clients which Mr.
Santos and Ms. Genuino helped/caused to divert their deposits/money placements with Citibank,
NA. to Torrance and Global (their family corporations) for subsequent investment in securities,
shares of stocks and debt papers in other companies were as follows:

xxx

b) Carmen Intengan

xxx

d) Rosario Neri

xxx

i) Rita Brawner

All the above persons/parties have long standing accounts with Citibank, N.A. in savings/dollar
deposits and/or in trust accounts and/or money placements.

As evidence, Lim annexed bank records purporting to establish the deception practiced by Santos
and Genuino. Some of the documents pertained to the dollar deposits of petitioners Carmen Ll.
Intengan, Rosario Ll. Neri, and Rita P. Brawner, as follows:

a) Annex “A-6”vii[7] - an “Application for Money Transfer” in the amount of US

$140,000.00, executed by Intengan in favor of Citibank $ S/A No. 24367796, to be debited from
her Account No. 22543341;

b) Annex “A-7”viii[8] - a “Money Transfer Slip” in the amount of US $45,996.30, executed

by Brawner in favor of Citibank $ S/A No. 24367796, to be debited from her Account No.
22543236; and

c) Annex “A-9”ix[9] - an “Application for Money Transfer” in the amount of US

$100,000.00, executed by Neri in favor of Citibank $ S/A No. 24367796, to be debited from her
Account No. 24501018.

In turn, private respondent Joven Reyes, vice-president/business manager of the Global

Consumer Banking Group of Citibank, admits to having authorized Lim to state the names of the
clients involved and to attach the pertinent bank records, including those of petitioners’. [10] He
x

states that private respondents Aziz Rajkotwala and William Ferguson, Citibank, N.A. Global
Consumer Banking Country Business Manager and Country Corporate Officer, respectively, had
no hand in the disclosure, and that he did so upon the advice of counsel.

In his memorandum, the Solicitor General described the scheme as having been conducted in this
manner:

First step: Santos and/or Genuino would tell the bank client that they knew of financial
products of other companies that were yielding higher rates of interests in which the bank client
can place his money. Acting on this information, the bank client would then authorize the
transfer of his funds from his Citibank account to the Citibank account of either Torrance or
Global.

The transfer of the Citibank client’s deposits was done through the accomplishment of either an
Application For Manager’s Checks or a Term Investment Application in favor of Global or
Torrance that was prepared/filed by Genuino herself.

Upon approval of the Application for Manager’s Checks or Term Investment Application, the
funds of the bank client covered thereof were then deposited in the Citibank accounts of
Torrance and/or Global.

Second step: Once the said fund transfers had been effected, Global and/or Torrance would then
issue its/ their checks drawn against its/their Citibank accounts in favor of the other companies
whose financial products, such as securities, shares of stocks and other certificates, were offering
higher yields.

Third step: On maturity date(s) of the placements made by Torrance and/or Global in the other
companies, using the monies of the Citibank client, the other companies would then. return the
placements to Global and/or Torrance with the corresponding interests earned.

Fourth step: Upon receipt by Global and/or Torrance of the remittances from the other
companies, Global and/or Torrance would then issue its/their own checks drawn against their
Citibank accounts in favor of Santos and Genuino.

The amounts covered by the checks represent the shares of Santos and Genuino in the margins
Global and/or Torrance had realized out of the placements [using the diverted monies of the
Citibank clients] made with the other companies.

Fifth step: At the same time, Global and/or Torrance would also issue its/their check(s) drawn
against its/their Citibank accounts in favor of the bank client.

The check(s) cover the principal amount (or parts thereof) which the Citibank client had
previously transferred, with the help of Santos and/or Genuino, from his Citibank account to the
Citibank account(s) of Global and/or Torrance for placement in the other companies, plus the
interests or earnings his placements in other companies had made less the spreads made by
Global, Torrance, Santos and Genuino.
The complaints which were docketed as I.S. Nos. 93-9969, 93-10058 and 94-1215 were
subsequently amended to include a charge of estafa under Article 315, paragraph 1(b) [11] of the
xi

Revised Penal Code.

As an incident to the foregoing, petitioners filed respective motions for the exclusion and
physical withdrawal of their bank records that were attached to Lim’s affidavit.

In due time, Lim and Reyes filed their respective counter-affidavits. [12] In separate Memoranda
xii

dated March 8, 1994 and March 15, 1994 2nd Assistant Provincial Prosecutor Hermino T.
Ubana, Sr. recommended the dismissal of petitioners’ complaints. The recommendation was
overruled by Provincial Prosecutor Mauro M. Castro who, in a Resolution dated August 18,
1994, [13] directed the filing of informations against private respondents for alleged violation of
xiii

Republic Act No. 1405, otherwise known as the Bank Secrecy Law.

Private respondents’ counsel then filed an appeal before the Department of Justice (DOJ). On
November 17, 1994, then DOJ Secretary Franklin M. Drilon issued a Resolution [14] ordering,
xiv

inter alia, the withdrawal of the aforesaid informations against private respondents. Petitioners’
motion for reconsideration [15] was denied by DOJ Acting Secretary Demetrio G. Demetria in a
xv

Resolution dated March 6, 1995. [16]

xvi

Initially, petitioners sought the reversal of the DOJ resolutions via a petition for certiorari and
mandamus filed with this Court, docketed as G.R. No. 119999-120001. However, the former
First Division of this Court, in a Resolution dated June 5, 1995, [17] referred the matter to the
xvii

Court of the Appeals, on the basis of the latter tribunal’s concurrent jurisdiction to issue the
extraordinary writs therein prayed for. The petition was docketed as CA-G.R. SP No. 37577 in
the Court of Appeals.

On July 8, 1996, the Court of Appeals rendered judgment dismissing the petition in CA-G.R. SP
No. 37577 and declared therein, as follows:

Clearly, the disclosure of petitioners’ deposits was necessary to establish the allegation that
Santos and Genuino had violated Section 31 of the Corporation Code in acquiring “any interest
adverse to the corporation in respect of any matter which has been reposed in him in
confidence.” To substantiate the alleged scheme of Santos and Genuino, private respondents had
to present the records of the monies which were manipulated by the two officers which included
the bank records of herein petitioners.

Although petitioners were not the parties involved in IS. No. 93-8469, their accounts were
relevant to the complete prosecution of the case against Santos and Genuino and the respondent
DOJ properly ruled that the disclosure of the same falls under the last exception of R.A. No.
1405. That ruling is consistent with the principle laid down in the case of Mellon Bank, N.A. vs.
Magsino (190 SCRA 633) where the Supreme Court allowed the testimonies on the bank
deposits of someone not a party to the case as it found that said bank deposits were material or
relevant to the allegations in the complaint. Significantly, therefore, as long as the bank deposits
are material to the case, although not necessarily the direct subject matter thereof, a disclosure of
the same is proper and falls within the scope of the exceptions provided for by R.A. No. 1405.
 xxx xxx xxx

Moreover, the language of the law itself is clear and cannot be subject to different
interpretations. A reading of the provision itself would readily reveal that the exception “or in
cases where the money deposited or invested is the subject matter of the litigation” is not
qualified by the phrase “upon order of competent Court” which refers only to cases of bribery or
dereliction of duty of public officials.

Petitioners’ motion for reconsideration was similarly denied in a Resolution dated April 16,
1997. Appeal was made in due time to this Court.

The instant petition was actually denied by the former Third Division of this Court in a
Resolution [18] dated July 16, 1997, on the ground that petitioners had failed to show that a
xviii

reversible error had been committed. On motion, however, the petition was reinstated [19] and
xix

eventually given due course. [20]

xx

In assailing the appellate court’s findings, petitioners assert that the disclosure of their bank
records was unwarranted and illegal for the following reasons:

I.

IN BLATANT VIOLATION OF R.A. NO. 1405, PRIVATE RESPONDENTS

ILLEGALLY MADE DISCLOSURES OF PETITIONERS’ CONFIDENTIAL BANK
DEPOSITS FOR THEIR SELFISH ENDS IN PROSECUTING THEIR COMPLAINT IN
IS. NO. 93-8469 THAT DID NOT INVOLVE PETITIONERS.

II.

PRIVATE RESPONDENTS’ DISCLOSURES DO NOT FALL UNDER THE FOURTH

EXCEPTION OF R.A. NO. 1405 (i.e., “in cases where the money deposited or invested is
the subject matter of the litigation”), NOR UNDER ANY OTHER EXCEPTION:

(1)

PETITIONERS’ DEPOSITS ARE NOT INVOLVED IN ANY LITIGATION

BETWEEN PETITIONERS AND RESPONDENTS. THERE IS NO LITIGATION
BETWEEN THE PARTIES, MUCH LESS ONE INVOLVING PETITIONERS’
DEPOSITS AS THE SUBJECT MATTER THEREOF.

(2)

EVEN ASSUMING ARGUENDO THAT THERE IS A LITIGATION INVOLVING

PETITIONERS’ DEPOSITS AS THE SUBJECT MATTER THEREOF, PRIVATE
RESPONDENTS’ DISCLOSURES OF PETITIONERS’ DEPOSITS ARE
NEVERTHELESS ILLEGAL FOR WANT OF THE REQUISITE COURT ORDER,
IN VIOLATION OF R.A. NO. 1405.
III.

THEREFORE, PETITIONERS ARE ENTITLED TO PROSECUTE PRIVATE

RESPONDENTS FOR VIOLATIONS OF R.A. NO. 1405 FOR HAVING ILLEGALLY
DISCLOSED PETITIONERS’ CONFIDENTIAL BANK DEPOSITS AND RECORDS IN
IS. NO. 93-8469.

Apart from the reversal of the decision and resolution of the appellate court as well as the
resolutions of the Department of Justice, petitioners pray that the latter agency be directed to
issue a resolution ordering the Provincial Prosecutor of Rizal to file the corresponding
informations for violation of Republic Act No. 1405 against private respondents.

The petition is not meritorious.

Actually, this case should have been studied more carefully by all concerned. The finest legal
minds in the country - from the parties’ respective counsel, the Provincial Prosecutor, the
Department of Justice, the Solicitor General, and the Court of Appeals - all appear to have
overlooked a single fact which dictates the outcome of the entire controversy. A circumspect
review of the record shows us the reason. The accounts in question are U.S. dollar deposits;
consequently, the applicable law is not Republic Act No. 1405 but Republic Act (RA) No. 6426,
known as the “Foreign Currency Deposit Act of the Philippines,” section 8 of which provides:

Sec. 8. Secrecy of Foreign Currency Deposits.- All foreign currency deposits authorized under
this Act, as amended by Presidential Decree No. 1035, as well as foreign currency deposits
authorized under Presidential Decree No. 1034, are hereby declared as and considered of an
absolutely confidential nature and, except upon the written permission of the depositor, in no
instance shall such foreign currency deposits be examined, inquired or looked into by any
person, government official bureau or office whether judicial or administrative or legislative or
any other entity whether public or private: Provided, however, that said foreign currency
deposits shall be exempt from attachment, garnishment, or any other order or process of any
court, legislative body, government agency or any administrative body whatsoever.xxi[21] (italics
supplied)

Thus, under R.A. No. 6426 there is only a single exception to the secrecy of foreign currency
deposits, that is, disclosure is allowed only upon the written permission of the depositor.
Incidentally, the acts of private respondents complained of happened before the enactment on
September 29, 2001 of R.A. No. 9160 otherwise known as the Anti-Money Laundering Act of
2001.

A case for violation of Republic Act No. 6426 should have been the proper case brought against
private respondents. Private respondents Lim and Reyes admitted that they had disclosed details
of petitioners’ dollar deposits without the latter’s written permission. It does not matter if that
such disclosure was necessary to establish Citibank’s case against Dante L. Santos and Marilou
Genuino. Lim’s act of disclosing details of petitioners’ bank records regarding their foreign
currency deposits, with the authority of Reyes, would appear to belong to that species of criminal
acts punishable by special laws, called malum prohibitum. In this regard, it has been held that:
While it is true that, as a rule and on principles of abstract justice, men are not and should not be
held criminally responsible for acts committed by them without guilty knowledge and criminal
or at least evil intent xxx, the courts have always recognized the power of the legislature, on
grounds of public policy and compelled by necessity, “the great master of things,” to forbid in a
limited class of cases the doing of certain acts, and to make their commission criminal without
regard to the intent of the doer. xxx In such cases no judicial authority has the power to require,
in the enforcement of the law, such knowledge or motive to be shown. As was said in the case of
State vs. McBrayer xxx:

‘It is a mistaken notion that positive, willful intent, as distinguished from a mere intent, to violate
the criminal law, is an essential ingredient in every criminal offense, and that where there is the
absence of such intent there is no offense; this is especially so as to statutory offenses. When the
statute plainly forbids an act to be done, and it is done by some person, the law implies
conclusively the guilty intent, although the offender was honestly mistaken as to the meaning of
the law he violates. When the language is plain and positive, and the offense is not made to
depend upon the positive, willful intent and purpose, nothing is left to interpretation.’xxii[22]

Ordinarily, the dismissal of the instant petition would have been without prejudice to the filing of
the proper charges against private respondents. The matter would have ended here were it not for
the intervention of time, specifically the lapse thereof. So as not to unduly prolong the settlement
of the case, we are constrained to rule on a material issue even though it was not raised by the
parties. We refer to the issue of prescription.

Republic Act No. 6426 being a special law, the provisions of Act No. 3326, xxiii
[23] as amended by
Act No. 3763, are applicable:

SECTION 1. Violations penalized by special acts shall, unless otherwise provided in such acts,
prescribe in accordance with the following rules: (a) after a year for offences punished only by a
fine or by imprisonment for not more than one month, or both: (b) after four years for those
punished by imprisonment for more than one month, but less than two years; (c) after eight years
for those punished by imprisonment for two years or more, but less than six years; and (d) after
twelve years for any other offence punished by imprisonment for six years or more, except the
crime of treason, which shall prescribe after twenty years: Provided, however, That all offences
against any law or part of law administered by the Bureau of Internal Revenue shall prescribe
after five years. Violations penalized by municipal ordinances shall prescribe after two months.

Violations of the regulations or conditions of certificates of public convenience issued by the

Public Service Commission shall prescribe after two months.

SEC. 2. Prescription shall begin to run from the day of the commission of the violation of the
law, and if the same be not known at the time, from the discovery thereof and the institution of
judicial proceedings for its investigation and punishment.

The prescription shall be interrupted when proceedings are instituted against the guilty person,
and shall begin to run again if the proceedings are dismissed for reasons not constituting
jeopardy.
A violation of Republic Act No. 6426 shall subject the offender to imprisonment of not less than
one year nor more than five years, or by a fine of not less than five thousand pesos nor more than
twenty-five thousand pesos, or both. [24] Applying Act No. 3326, the offense prescribes in eight
xxiv

years. [25] Per available records, private respondents may no longer be haled before the courts
xxv

for violation of Republic Act No. 6426. Private respondent Vic Lim made the disclosure in
September of 1993 in his affidavit submitted before the Provincial Fiscal. [26] In her complaint-
xxvi

affidavit, [27] Intengan stated that she learned of the revelation of the details of her foreign
xxvii

currency bank account on October 14, 1993. On the other hand, Neri asserts that she discovered
the disclosure on October 24, 1993. [28] As to Brawner, the material date is January 5, 1994.
xxviii xxix

[29] Based on any of these dates, prescription has set in. [30]
xxx

The filing of the complaint or information in the case at bar for alleged violation of Republic Act
No. 1405 did not have the effect of tolling the prescriptive period. For it is the filing of the
complaint or information corresponding to the correct offense which produces that effect. [31]xxxi

It may well be argued that the foregoing disquisition would leave petitioners with no remedy in
law. We point out, however, that the confidentiality of foreign currency deposits mandated by
Republic Act No. 6426, as amended by Presidential Decree No. 1246, came into effect as far
back as 1977. Hence, ignorance thereof cannot be pretended. On one hand, the existence of laws
is a matter of mandatory judicial notice; [32] on the other, ignorantia legis non excusat. [33]
xxxii xxxiii

Even during the pendency of this appeal, nothing prevented the petitioners from filing a
complaint charging the correct offense against private respondents. This was not done, as
everyone involved was content to submit the case on the basis of an alleged violation of Republic
Act No. 1405 (Bank Secrecy Law), however, incorrectly invoked. [34]xxxiv

WHEREFORE, the petition is hereby DENIED. No pronouncement as to costs.

SO ORDERED.

Bellosillo, (Chairman), Mendoza, Quisumbing, and Buena, JJ., concur.

i[1] Rollo, pp. 61-70.

ii[2] Former Presiding Justice Salome A. Montoya, (ret.), ponente, with Justice Godardo A. Jacinto and
Justice Maximiano C. Asuncion, concurring.

iii[3] Rollo, p. 72.

iv[4] “SEC. 31. Liability of directors, trustees or officers-Directors or trustees who willfully and
knowingly vote for or assent to patently unlawful acts of the corporation or who are guilty of gross
negligence or bad faith in directing the affairs of the corporation or acquire any personal or pecuniary
interest in conflict with their duty as such directors or trustees shall be liable jointly and severally for
all damages resulting therefrom suffered by the corporation, its stockholders or members and other
persons.

When a director, trustee or officer attempts to acquire or acquires, in violation of his duty, any interest
adverse to the corporation in respect of any matter which has been reposed in him in confidence, as to
which equity imposes a disability upon him to deal in his own behalf, he shall be liable as a trustee for
the corporation and must account for the profits which otherwise would have accrued to the
corporation.”

v[5] “SEC. 144. Violations of the Code. -Violations of any of the provisions of this Code or its
amendments not otherwise specifically penalized therein shall be punished by a fine of not less than
one thousand (P1,000.00) pesos but not more than ten thousand (P10,000.00) pesos or by imprisonment
for not less than thirty (30) days but not more than five (5) years, or both, in the discretion of the court.
If the violation is committed by a corporation, the same may, after notice and hearing, be dissolved in
appropriate proceedings before the Securities and Exchange Commission; Provided, That such
dissolution shall not preclude the institution of appropriate action against the director, trustee or officer
of the corporation responsible for said violation; Provided, further, That nothing in this section shall be
construed to repeal the other causes for dissolution of a corporation provided in this Code.”

vi[6] Rollo, pp. 94-104.

vii[7] Rollo, p. 575.

viii[8] Rollo, p. 576.

ix[9] Rollo, p. 577.

x[10] Counter-affidavit of Joven Reyes, Rollo, pp. 123-126.

xi[11] “ARTICLE 315. Swindling (estafa).-Any person who shall defraud another by any of the means
mentioned hereinbelow shall be punished by: xxx

1. With unfaithfulness or abuse of confidence, namely: xxx

(b) By misappropriating or converting, to the prejudice of another, money, goods, or any other
personal property received by the offender in trust, or on commission, or for administration, or under
any other obligation involving the duty to make delivery of, or to return the same, even though such
obligation be totally or partially guaranteed by a bond; or by denying having received such money,
goods, or other property; xxx”

xii[12] Ferguson and Rajkotwala failed to file theirs, and so were held to have waived their right.

xiii[13] Annex “G” of the petition, Rollo, pp. 153-168.

xiv[14] Annex “A-2,” Rollo, pp. 73-84.

xv[15] Annex “J,” Rollo, pp. 286-315.

xvi[16] Annex “A-3,” Rollo, pp. 85-87.

xvii[17] CA Rollo, p. 290.

xviii[18] Rollo, p. 514.

xix[19] Resolution dated September 22, 1997; Rollo, p. 530.

xx[20] Resolution dated September 11, 2000; Rollo, p. 751.

xxi[21] The absolute confidentiality of foreign currency deposits, subject to the lone exception, was
introduced by Presidential Decree No. 1246 promulgated on November 21, 1977.

xxii[22] U.S. v. Siy Cong Bieng, et al., 30 Phil. 577, 579-580 (1915).

xxiii[23] “An Act to Establish Periods of Prescription for Violations Penalized by Special Acts and
Municipal Ordinances and to Provide When Prescription Shall Begin to Run.”

xxiv[24] Section 10, R.A. No. 6426.

xxv[25] It is true that Republic Act No. 6426 prescribes, as an alternative penalty, a fine ranging from
five thousand pesos to twenty-five thousand pesos. However, this cannot be used as the basis for
determining prescription, as was done in People v. Basalo (101 Phil. 57 [1957]), inasmuch as Article 90
of the Revised Penal Code does not apply to offenses punishable under special laws (People v. Ching
Lak, 103 Phil. 1149 [1958]).

xxvi[26] The exact date cannot be determined, it being unintelligible from the photocopies contained in
the rollo.

xxvii[27] Rollo, p. 90.

xxviii[28] Complaint-Affidavit of Rosario LL. Neri, Rollo, p. 108.

xxix[29] Complaint-Affidavit of Rita P. Brawner, Rollo, p. 114.

xxx[30] In Presidential Ad Hoc Fact-Finding Committee on Behest Loans v. Desierto, 317 SCRA 272,
298 (1999), citing People v. Duque, 212 SCRA 607, 613-614 (1992), we held, to wit: “In the nature of
things, acts made criminal by special laws are frequently not immoral or obviously criminal in
themselves; for this reason, the applicable statute requires that if the violation of the special law is not
known at the time, prescription begins to run only from the discovery thereof, i.e., discovery of the
unlawful nature of the constitutive act or acts.”

xxxi[31] Cf. People v. Abuy, 5 SCRA 222, 226-227(1962).

xxxii[32] Revised Rules on Evidence, Rule 129, section 1.

xxxiii[33] Art. 3, New Civil Code. Ignorance of the law excuses no one from compliance therewith.

xxxiv[34] This complacency is amply evidenced by the rollo of this case, which consists of more than
900 pages. The rollo of CA-G.R. SP No. 37577 appears to be of even greater length.