Professional Documents
Culture Documents
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6 .Q: The Monetary Board of the BSP closed Urban
Bank after it encountered crippling financial difficulties
that resulted in a bank run. X, one of the members of
the BOD of the bank, attended and stayed throughout
the entire meeting of the Board that was held well in
advance of the bank run and before news had begun
to trickle to the business community about the dire
financial pit the bank had fallen into. Immediately after
the meeting, X caused the preparation and issuance of
a managers check payable to himself in the sum of 5
million pesos equivalent to the amount placed or
invested in the bank by a business acquaintance. He
now claims that he is keeping the funds in trust for the
owner and that he had committed no violation of the
General Banking Act (RA 337, as amended) for which
he should be punished. Do you agree that there has
been no violation of the statute? (2000)
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SUGGESTED ANSWER:
No. I do not agree that there is no violation of the
statute (RA 337, as amended). X violated Sec 85 when
he caused the preparation and issuance of a
managers check payable to himself in the sum of P5
million. This is paying out or permitting to be paid out
funds of the bank after the latter became insolvent.
This act is penalized by fine of not less than P1,000.00
nor more than P10,000.00 and by imprisonment for not
less than two nor more than ten years.
A.
TO
DOSRI
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mortgage over a vast commercial lot in the Fort
Bonifacio Global City, appraised at P350 Million. After
audit, the Bangko Sentral ng Pilipinas gave notice that
the loan to Celestial Properties exceeded the single
borrower's limit of 25% of the bank's net worth
under a recent BSP Circular. In light of other previous
similar violations of the credit limit requirement, the
BSP advised Industry Bank to reduce the amount of
the loan to Celestial Properties under pain of severe
sanctions. When Industry Bank informed Celestial
Properties that it intended to reduce the loan by P50
Million, Celestial Properties countered that the bank
should first release a part of the collateral worth P50
Million. Industry Bank rejected the counter-proposal,
and reffered the matter to you as counsel. How would
you advise Industry Bank to proceed, with its best
interest in mind? (2008)
SUGGESTED ANSWER:
I Shall advise Industry Bank that the mortgage is
indivisible. Therefore, Celestial Properties cannot ask
for a partial release of the mortgage so long as the
loan has not been completely paid. (Art 2089, Civil
Code)
11. Q: Banks: Applicability: Foreign Currency
Deposit Act & Secrecy of Bank Deposits (2005)
SUGGESTED ANSWER:
Hi Yielding Corporation filed a complaint against five of
its officers for violation of Section 31 of the Corporation
Code. The corporation claimed that the said officers
were guilty of advancing their personal interests to the
prejudice of the corporation, and that they were grossly
negligent in handling its affairs. Aside from documents
and contracts, the corporation also submitted in
evidence records of the officers U.S. Dollar deposits in
several banks overseas - Boston Bank, Bank of
Switzerland, and Bank of New York. For their part, the
officers filed a criminal complaint against the directors
of Hi Yielding Corporation for violation of Republic Act
No. 6426, otherwise known as the Foreign Currency
Deposit Act of the Philippines. The officers alleged that
their bank deposits were illegally disclosed for want of
a court order, and that such deposits were not even
the subject of the case against them.
a) Will the complaint filed against the directors of Hi
Yielding Corporation prosper? Explain.
SUGGESTED ANSWER:
No, because the Foreign Currency Deposit Act (R.A.
No. 6426), including its punitive provisions, refers to
foreign currency deposits accounts constituted within
the Philippines. It has no application at all to accounts,
even though they are banks, opened and constituted
abroad.
b) Was there a violation of the Secrecy of Bank
Deposits Law (Republic Act No. 1405)? Explain.
SUGGESTED ANSWER:
No, because the punitive provisions of the Secrecy of
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report to the AMLC covered and suspicious
transactions, without thereby violating any law.
This is one of the exceptions to the Secrecy of
Bank Deposit Act.
4. the titles of the houses and lots are in
possession of the Luansing Realty, Inc., is it
under obligation to deliver the titles to Rudy?
SUGGESTED ANSWER:
Yes, it has an obligation to deliver titles to Rudy. As
Luansing Realty, Inc. is not a covered institution
under Section 3 of the Anti-Money Laundering Act,
it may not invoke this law to refuse delivery of the
titles to Rudy.
13. Q: Banks; Secrecy of Bank Deposit; Exceptions
(2006)
Under Republic Act No.1405 (The Bank Secrecy Law),
bank deposits are considered absolutely confidential
and may not be examined, inquired or looked into by
any person, government official, bureau or office. What
are the exceptions