REPUBLIC V.

JUDGE EUGENIO having been used to facilitate corruption in the NAIA 3

G.R. NO. 174629, 14 FEBRUARY 2008 Project. The ex parte application was granted and the
MANILA RTC issued a bank inquiry order.
FACTS: After the Agan v. PIATCO ruling, a series of
Alvarez alleged that he fortuitously learned of the bank
investigations concerning the award of the NAIA 3
inquiry order, which was issued following an ex parte
contracts to PIATCO were undertaken by the
application, and he argued that nothing in the Anti-
Ombudsman and the Compliance and Investigation Staff
Money Laundering Act (“AMLA”) authorized the AMLC to
(“CIS”) of the Anti-Money Laundering Council (“AMLC”).
seek the authority to inquire into bank accounts ex
parte.
The OSG wrote AMLC requesting AMLC’s assistance “in
obtaining more evidence to completely reveal the
After several motions, manifestations, orders and
financial trail of corruption surrounding the NAIA 3
resolutions the case went up to the SC. Alvarez et al.’s
Project,” and also noting that the Republic was presently
position: The AMLA, being a substantive penal statute, has no
defending itself in two international arbitration retroactive effect and the bank inquiry order could not apply to
cases. The CIS conducted an intelligence database deposits or investments opened prior to the effectivity of the
search on the financial transactions of certain individuals AMLA (17 October 2001). The subject bank accounts, opened in
involved in the award, including Alvarez (Chairman of 1989 to 1990, could not be the subject of the bank inquiry
the Pre-Qualification Bids and Awards Technical order without violating the constitutional prohibition against ex
Committee). By this time, Alvarez had already been post facto laws.3
charged by the Ombudsman with violation of Section 3(J)
of the Anti Graft and Corrupt Practices Act.1 The search ISSUE: Whether or not the proscription against ex post
revealed that Alvarez maintained 8 bank accounts with 6 facto laws applies to Section 11 of the AMLA (a provision
different banks which does not provide a penal sanction BUT which
merely authorizes the inspection of suspect accounts
The AMLC issued a resolution authorizing its Executive and deposits).4
Director to sign and verify an application to inquire into
the deposits or investments of Alvarez et al. and to HELD: YES. It is clear that no person may be prosecuted
authorize the AMLC Secretariat to conduct an inquiry under the PENAL provisions of the AMLA for acts
once the RTC grants the application. The rationale for committed prior to the enactment of the law (17 October
the resolution was founded on the findings of the CIS 2001).
that amounts were transferred from a Hong Kong bank
account to bank accounts in the Philippines maintained With respect to the AUTHORITY TO INSPECT, it should be
by respondents. The Resolution also noted that by noted that an ex post facto law is one that (among
awarding the contract to PIATCO (despite its lack of others) deprives a person accused of a crime of some
financial capacity) Alvarez violated Section 3(E) of the lawful protection to which he has become entitled, such
Anti Graft and Corrupt Practices Act.2 The MAKATI RTC as the protection of a former conviction or acquittal, or a
rendered an Order granting the AMLC the authority to proclamation of amnesty.
inquire and examine the subject bank accounts of
Alvarez et al. PRIOR to the AMLA:
(1) The fact that bank accounts were involved in activities later
In response to a letter of Special Prosecutor Villa-Ignacio, on enumerated in the law did not, by itself, remove such
AMLC issued a Resolution authorizing its Executive accounts from the shelter of absolute confidentiality.
Director to inquire into and examine the accounts of (2) In order that bank accounts could be examined, there was
need to secure either the written permission of the depositor
Alvarez, PIATCO, and several other entities involved in
OR a court order authorizing such examination, assuming that
the nullified contract. AMLC filed an application before they were involved in cases of bribery or dereliction of duty of
the MANILA RTC to inquire into the accounts alleged as public officials, or in a case where the money deposited or
1 invested was itself the subject matter of the litigation.
Sec. 3. Corrupt practices of public officers. - In addition to acts or
omissions of public officers already penalized by existing law, the
following shall constitute corrupt practices of any public officer and
are hereby declared to be unlawful:
3
(j) Knowingly approving or granting any license, permit, privilege Please read the original for the other issues aside from Art. 3,
or benefit in favor of any person not qualified for or not legally §22.
entitled to such license, permit, privilege or advantage, or of a 4
Section 11. Authority to inquire into Bank Deposits. –
mere representative or dummy of one who is not so qualified or
Notwithstanding the provisions of Republic Act No. 1405, as
entitled.
amended; Republic Act No. 6426, as amended; Republic Act No.
2
(e) Causing any undue injury to any party, including the 8791, and other laws, the AMLC may inquire into or examine any
Government, or giving any private party any unwarranted benefits, particular deposit or investment with any banking institution or
advantage or preference in the discharge of his official non-bank financial institution upon order of any competent court in
administrative or judicial functions through manifest partiality, cases of violation of this Act when it has been established that
evident bad faith or gross inexcusable negligence. This provision there is probable cause that the deposits or investments involved
shall apply to officers and employees of offices or government are in any way related to a money laundering offense: Provided,
corporations charged with the grant of licenses or permits or other That this provision shall not apply to deposits and investments
concessions. made prior to the effectivity of this Act.
POLITICAL LAW REVIEW | ATTY. JACK JIMENEZ | MARK JOREL O. CALIDA
The passage of the AMLA stripped another layer off the
rule on absolute confidentiality that provided a measure
of lawful protection to the account holder. The
application of the bank inquiry order as a means of
inquiring into transactions entered into prior to the
passage of the AMLA would be constitutionally infirm,
offensive as to the ex post facto clause.

NEVERTHELESS, the argument that the prohibition

against ex post facto laws goes as far as to prohibit any
inquiry into deposits in bank accounts OPENED prior to
the effectivity of the AMLA even if the TRANSACTIONS
were entered into when the law had already taken effect
cannot be sustained. This argument will create a
loophole in the AMLA that would result to further money
laundering. It is hard to presume that Congress intended
to enact a self-defeating law in the first place, and the
courts are inhibited from such a construction by the
cardinal rule that “a law should be interpreted with a
view to upholding rather than destroying it.”

POLITICAL LAW REVIEW | ATTY. JACK JIMENEZ | MARK JOREL O. CALIDA