DEPARTMENT OF LEGAL MANAGEMENT Saturdays, 11:00 - 14:00

SAN BEDA UNIVERSITY 2st Semester A.Y. 2018-2019

Manila Prof. J. P. Del Rosario

BANKING AND INSURANCE LAWS

Syllabus/ Study Guide

DURATION TOPICS ACTIVITIES

 Guided
Week 1-3 I. GENERAL BANKING LAWS (GBL) and related laws discussion
 Lecture
A. General Concepts  Recitation
 Case
i. Declared State Policy digests/
ii. Definition of Banks analyses
iii. Distinction from quasi-banks  Group
iv. Investment Companies activity
v. Nature of Banking Business
vi. Debtor-creditor relationship
(Art. 1980, New Civil Code (NCC)
- Simple loan
- Depositary
- Trust Agreement
vii. Applicability of Legal Compensation
viii. Diligence required (Sec, 2 GBL)
viii. Public Interest Involved
ix. Liability for Acts of Officers and Employees
- Commission of crimes (See RPC provisions on estafa
and qualified theft)
- Liability for damages
ix. Classification of banks

Jurisprudence:

- Simex International (Manila) vs. CA, GR No. 88013, March 18,1990;

- Teodoro Banas vs. Asia Pacific Finance Corp., GR No. 128703, October
18, 2000;
- Republic vs. Security and Acceptance Corp. G.R. No. L-20583, January
23, 1967
- Consolidated Bank vs. Court of Appeals, G.R. No. 138569, September
11, 2003;
- Citibank vs. Sabeniano, G.R. No 156132, February 6, 2007;
- Philippine Banking Corporation vs. Court of Appeals, G.R. No. 127469,
 January 15, 2004;
- Bank of the Philippine Islands vs. Court of Appeals, G.R. No. 104612,
May 10, 1994;
- People Vs. Porras, GR 173654-765, August 8, 2008
- Roque vs. People, 444 SCRA 98, Nov 25, 2004

II. NEW CENTRAL BANK ACT (NCBA) and related laws

B. Organization of Banks

i. Bangko Sentral ng Pilipinas

- Responsibilities and Objectives (Sec 3, NCBA)
- Supervision of banks (Sec. 4, NCBA)
- Corporate Powers (Sec. 5, NCBA)
- Money Function (Sec. 50, NCBA)

ii. Authority to Operate

- Incorporation
- Capital Requirements
- Foreign Ownership z
- Individuals and non-banks (Sec. 11, GBL)
- Foreign banks (R.A. 7721, Sec. 73, GBL,
- Board of Directors (Secs. 15 and 19, GBL)
- Disqualifications for prohibitions
(PDIC Sec. 17, RA 7353 Sec. 3)
- Fit and Proper Rule
-
iii. Powers of the Monetary Board
iv. Fit and Proper Rule (Section 16, GBL)
v. Authority to engage in Banking and Quasi-banking
functions
vi. Conservatorship (Sec. 29, NCBA)
vii. Receivership and liquidation (Sec 30, NCBA)

Jurisprudence:
- Producer’s Bank of the Philippines vs. NLRC, G.R. No.
118069, November 16, 1998;
- Development Bank of the Philippines vs. Commission on Audit, G.R.
No. 88435, January 6, 2002;
- Perez v. Monetary Board, G.R. No. 23307, June 30, 1967;

C. Functions of Banks

i. Deposit functions
- Kinds of Deposits
ii. Safety deposit boxes
iii. Loan functions
- Single Borrower’s Account (Sec. 35.1, GBL; BSP Circular
 425)
- DOSRI Accounts (Sec. 26, NCBA, Sec. 36, GBL)
- Prohibited acts of borrowers (Sec. 55.2, GBL)
iv. Other Functions
v. Prohibited acts of banks

Jurisprudence:
- Serrano vs. Central Bank of the Phils. GR No. 30511, February 14, 1990;
- CA Agro-industrial Dev. Corp. v. CA, 1983, GR. No. 90027, May 3, 1993.
-

 Guided
Week 4 and 5 III. SECRECY OF BANK DEPOSITS (R.A 1405, as amended) discussion
 Lecture
A. Purpose  Recitation
B. Prohibited Acts  Case
C. Deposits Covered digests/
D. Exceptions analyses
Relate to other applicable laws
i. Foreign Currency Deposit Act
ii. Anti-Graft and Corrupt Practices Act
iii. National Internal Revenue Code
iv. General Banking Law
v. New Central Bank Act
vi. Human Security Act
E. Garnishments of Deposits
i. Freezing of Deposits

Jurisprudence:
- China Banking Corp. vs. Ortega, GR No. 34964, 49 SCRA 356, January
31, 1973;
- Salvation vs. Central Bank of the Philippines, GR No. 94723, August 21,
1997;
- Philippine Commercial and Industrial Bank vs. CA, G.R. No. 84526, 193
SCRA 452, January 28, 1991;
- Marquez vs. Desierto, GR No. 135882, June 27, 2001;
- BSP Group vs. Sally Go, GR No. 168644, February 16, 2010; and
- Union Bank vs. CA, GR No. 134699, 321 SCRA 563, December 23, 1999.

IV. FOREIGN CURRENCY DEPOSITS ACT (R.A. 6426)

A. Foreign Currency Deposits, defined

B. Foreign Currency Cover requirements
C. Secrecy of Foreign Currency Deposits
D. Garnishment of Foreign Currency Deposits

Jurisprudence:
Intengan vs. Court of Appeals GR No. 128996, February 15, 2002.
Week 6 V. ANTI MONEY LAUNDERING ACT (AMLA)  Guided
(R.A. No. 9160, as amended by R. A. No. 9194 and 10167.) discussion
 Lecture
A. Policy of the Law  Recitation
B. Steps in Money Laundering  Case
- Placement Analysis
- Layering; and
 Law
- Integration
Review
C. Salient Features of the AMLA
 Quiz
- Offenses punishable by AMLA
- Creation of the AMLC
- Creation of the Financial Intelligence Unit
- International cooperation
- Prevention of money laundering
D. Covered Institutions
- Obligations of Covered Institutions
- Record-keeping requirements
- Reporting requirements
- Safe Harbor Commission
E. Covered Transactions
F. Suspicious Transactions
- Know your customer (KYC) rule
G. Anti-Money Laundering Council of the AMLC
H. Powers and Functions of the AMLC
I. Freezing of Money Instrument or Property
J. Authority to Inquire Into Bank Deposits

Jurisprudence:
- Ligot, et al v. Republic of the Philippines, G.R. No.
176944, March 6, 2013.;
- Republic of the Philippines vs. Austria Martinez, G.R. No.
174629 , February 14, 2008.

VI. UNCLAIMED BALANCES ACT (R.A. No. 3936)

A. Policy and objectives

B. Dormant accounts/ unclaimed balances
C. Procedure
D. Immunity from suit
E. Reclassification
F. Escheat proceedings (Rule 91 of the Rules of Court)

Jurisprudence:
- Republic vs. FNCB, GR. No. 16106, December 30, 1961
Suggested reference materials:

1. Banking laws and jurisprudence by Efren Vincent Dizon, Rex Bookstore, Inc..
2. Notes and Cases on Banking and Negotiable Instruments Law II by Timoteo Aquino, Rex Bookstore, Inc.
3. Philippine General Banking Law by Rafael Morales.
4. Supreme Court Reports Annotated

Electronic Sources:

1. http://sc.judiciary.gov.ph/
2. http://www.lawphil.net/