Senate wants to investigate BSP auditing of bank accounts

MANILA, Philippines - The Senate wants a full-blown inquiry into the powers invoked by the Bangko Sentral ng Pilipinas (BSP) to justify its audit of the bank accounts of some individuals classified as “Politically Exposed Persons (PEP),” including Chief Justice Renato Corona, from September to November 2011.

Corona is on trial by the Senate acting as impeachment court.

Senators have noted that there is no provision in the Anti-Money Laundering Act (AMLA) that allows the BSP to classify depositors as PEP. He said a depositor classified as such is vulnerable to unreasonable audit.

The Senate committee on banks, financial institutions and currencies, chaired by Sen. Sergio Osmeña III, has set a hearing on the issue on Monday.

“My God, it is the entire system that is an issue here. I am not against the examining if they comply with the law, but if they can look into the accounts of anybody in this country, then what (for) are the Republic Acts (RA) that impose secrecies on certain matters in this country?” Senate President Juan Ponce Enrile asked his colleagues during the morning session of the Senate yesterday.

Enrile was referring to RA 6426 and RA 1465, the laws which cover foreign and local deposits, respectively.

“Is this not a violation of our laws? Is this not an intrusion into the Bill of Rights? Is this not a violation of the rule of law in this country? Have we become lawless? I posit this question and address it to the members of this Senate,” the Senate President said. Enrile made the manifestation after Sen. Teofisto Guingona III read the explanation of the BSP of its 2010 audit of some accounts with Philippine Savings Bank (PSBank) Katipunan branch.

Aside from Enrile and Guingona, Senators Edgardo Angara, Franklin Drilon, Loren Legarda, Aquilino Pimentel III and Osmeña also expressed concern regarding BSP Circular 706 dated Jan. 23, 2011 allowing the creation of a special group to look into accounts of PEPs.

“Then this is worse than I thought,” Angara said. “This, in effect, constitutes a special witch-hunt for PEPs who can be a subject for audits and whose accounts can be the first to be examined. I think you cannot think of a worse invasion of privacy than this,” he added.

“Only totalitarian countries can look into the private affairs of their people... We are a democratic society and we have laws that prohibit anybody looking into the accounts of citizens,” Enrile said.

Osmeña had wanted the impeachment court to tackle the issue but was prevailed upon by Drilon, who pointed out that the Senate committee on banks should deal with the issue.

“I have been wondering about this category of ‘Politically Exposed Persons,’ and its impact and implications on a group of citizens being classified as such, in terms of credit extensions, withdrawals and special treatment,” Angara said. “The banks could restrict credit because these groups would be deemed not credit-worthy. I’m afraid that because of this denomination, these people will have to wait before the banks consider their application for credit and other services.” – With Jess Diaz, Delon Porcalla, Paolo Romero