A.M. No. 21-03-05-CA: The Court of Appeals Rule of Procedure in Bank Inquiries Relating to Unlawful Activity or Money Laundering Offense

On 23 March 23, 2021, the Supreme Court issued A.M. No. 21-03-05-CA, the Court of Appeals (“CA”) Rule of Procedure in Cases of Bank Inquiry into or Examination of Deposit and Investment Accounts Relating to an Unlawful Activity or a Money Laundering Offense Under R.A. No. 9160, as amended (the “Rules”).

The Rules shall apply to ex parte applications for authority to inquire into or examine, deposit or investment accounts with any banking institution or non-bank financial institution and their subsidiaries and affiliates representing, involving, or relating to an unlawful activity under Section 3(i) or a money laundering offense under Section 4 of R.A. No. 9160, as amended, except in cases of unlawful activities as provided under Section 11 thereof.

Filing of ex parte applications 

The application may be filed by the Republic of the Philippines, represented by the Anti-Money Laundering Council (“AMLC”) through the Office of Solicitor General(“OSG”) when it has been established that there is probable cause that the deposits or investments involved, including related accounts, are in any way related to an unlawful activity or a money laundering offense. The same shall be filed with the CA in Manila in cases involving a mix of banks with main office in Manila or Luzon and local banks which do not have offices in Luzon. If two or more local banks (without offices in Luzon are involved), but one or some have offices in the Visayas while the others are based in Mindanao, the application shall be filed with the CA station where the main office of the local bank is located.

The application shall be verified and accompanied by a sworn certification of non-forum shopping personally signed by an authorized official of the AMLC, and as provided in the fourth paragraph of Section 3, Rule 46 of the Revised Rules of Court (“RCC”). The application shall be filed in three (3) clearly legible copies, one (1) original (properly marked) and two (2) copies with their annexes. Soft copies (PDF format) of the same by USB, CD, DVD, or any other electronic storage shall likewise be submitted. 

The application shall contain the following allegations: 

1. Account number, or any other specific description of the deposit or investment accounts sought to be inquired into or examined, the owner or holder of the same, the address of such owner or holder, the name of the banking institution or non-bank financial institution where such account is maintained, and their location, if known; 
2. Grounds relied upon; and
3. Supporting evidence showing the existence of probable cause that the subject deposit or investment accounts are in any way related to an unlawful activity or a money laundering offense under R.A. No. 9160.

Venue for filing of the ex parte applications

The application, as well as all compliances, incidents, and motions shall be filed directly with the Presiding Justice of the CA in Manila, or the Executive Justices in Cebu City or Cagayan de Oro City. In their absence, the same shall be filed with the next available senior justice.

The application shall be docketed in a separate logbook under the custody and responsibility of a designated member of the staff of the justice concerned. The said logbook and the entries therein shall be kept strictly confidential. No person, including court personnel, shall disclose, divulge, or communicate to anyone, directly or indirectly, in any manner or by any means, the fact of filing of the application, its contents and its entry in the logbook, or the fact of issuance by the court of a resolution in relation thereto, except to those authorized by the court. Any violation shall constitute contempt of court and ground for an administrative case.

The application shall be raffled immediately on the day of its filing by at least three (3) Chairpersons of the first ten (10) divisions in Manila, or the Executive Justices and the Chairpersons of the two (2) other divisions in Cebu City or Cagayan de Oro City. To preserve the confidentiality, the justice concerned has the discretion to transfer the venue of the raffle and limit the clerical staff to be present therein.

Action to be taken on the ex parte application

The application shall be resolved within twenty-four (24) hours from receipt thereof.  In the absence of any of the members of the division to which the assigned justice belongs, the Raffle Committee shall select a replacement via raffle from among the members of the first ten (10) divisions in Manila or the remaining members of the two (2) division in Cebu City or Cagayan de Oro City to resolve the application. If the CA finds no merit in the application, it shall dismiss the same, stating the specific reasons therefor.

When the unanimous vote of the three (3) justices of the division cannot be obtained, the Presiding Justice or the Executive Justice concerned shall designate two (2) justices by raffle from among the members of the first ten (10) divisions in Manila or the remaining two (2) divisions in Cebu City or Cagayan de Oro City, to sit with them forming a special division of five (5) justices. The concurrence of a majority of such special division shall be required for the pronouncement of a judgment or resolution.

An application shall remain with the justice to whom it is assigned and the members who participated therein until its final resolution. However, in case of substitution or replacement of members, the 2009 Internal Rules of the CA shall apply. The substitute or replacement justice in the regular raffle shall also act as substitute or replacement in AMLC cases, provided that the said justice is a member of the first ten (10) divisions in Manila or a member of the two (2) divisions in Cebu City or Cagayan de Oro City. Otherwise, another raffle shall be conducted, and the substitute or replacement chosen from among the members of the first ten (10) divisions in Manila or members of the two (2) divisions in Cebu City or Cagayan de Oro City.

The bank inquiry order shall:

1. Issue in the name of the Republic represented by the AMLC;
2. Describe with particularity the deposit or investment account sought to be inquired into or examined, as well as the names of the account owners/holders;
3. Direct the concerned banking institution or non-bank financial institution to allow the AMLC, or its authorized personnel full access to all information, documents, and objects relating to the subject deposit or investment account within a specific period of time;
4. Forbid the banking institution or non-bank financial institution, or any of its directors, officers, and employees, from disclosing, divulging, or communicating, directly or indirectly, or in any manner, to the owners or holders of accounts inquired into, or to any other person, the fact that said accounts are being inquired into or examined, with warning that any violation thereof constitutes contempt of court; and
5. Direct the OSG to inform the court of the institution of a civil forfeiture proceeding within five (5) calendar days from its filing.

Prior to the transmittal of the case and its records to the RTC for consolidation with the pending civil forfeiture proceedings, the names and other pertinent information of persons not joined as parties to the civil forfeiture case shall be excluded from the records.

A bank inquiry order has an effectivity period of one hundred twenty (120) calendar days from the date of receipt by the AMLC which may be extended for good cause for the same number of days. It has the same effect as a freeze order under Section 2 (d), Rule VI of the CA Rules. The copies of the bank inquiry order shall be served exclusively and personally on the AMLC and the OSG not later than twenty-four (24) hours from promulgation. 

A banking institution or non-bank financial institution shall give full and immediate access to all information, document, and objects regarding the deposit or investment accounts being inquired into upon receipt of a copy of the bank inquiry order from the AMLC. The confidentiality of the bank inquiry order shall be maintained by the officers or employees of the concerned banking institution or non-bank financial institution. Otherwise, the said persons shall be penalized for contempt of court. 

A supplemental ex parte application may be filed by the AMLC with the CA. The same shall be acted upon by the justice to whom the original application was assigned. A separate docket number will be given but shall be referred after raffle to the former Ponente and the justices who participated in the original application for appropriate action. 

In case of denial of the application, the same can only be reviewed through a Petition for Certiorari to the Supreme Court under Rule 65 of the RCC.
The full text of A.M. No. 21-03-05-CA may be accessed here: https://sc.judiciary.gov.ph/18729/