JPE says BSP expert 'lying' on bank leak

MANILA, Philippines - Senate President Juan Ponce Enrile called Bangko Sentral ng Pilipinas (BSP) anti-money laundering expert Jerry Leal a liar and moved to cite him for contempt during yesterday’s inquiry into the alleged leak of documents on Chief Justice Renato Corona’s deposit accounts with Philippine Savings Bank (PSBank).

Enrile made the accusation after Leal gave conflicting statements regarding the BSP’s examination of some PSBank accounts – including Corona’s – in September 2010.

Trouble began when PSBank president Pascual Garcia III maintained that records of Corona’s account with the Katipunan branch of PSBank were among the documents sought by Leal from the bank for BSP’s examination.

Leal denied asking for information on the account of Corona or receiving those documents.

“There is an untruth in this particular case. Somewhere along the way there is a falsehood being done. Somebody’s lying, I’m not saying cover up, somebody’s lying,” Enrile said at the start of the hearing.

The alleged leak of Corona’s bank documents came to light during the early stage of the impeachment trial. Even then, Leal and Garcia had clashing testimonies on the matter.

In yesterday’s Senate hearing, Garcia cited two separate instructions from Leal regarding the examination on the so-called covered accounts of PSBank. He said that Leal required the bank to submit a soft copy of account opening documents covering the period April 1, 2009 to September 2010.

Garcia said Leal’s instructions covered Corona’s account.

Soft copies of the information provided to Leal included the opening date for the accounts, customer type, account name and number and the originating branch.

“For the purpose of this audit, the information also includes all transactions,” Garcia said.

Leal denied having received anything related to the accounts of Corona, specifically signature cards and other account opening documents. “They have a log sheet. We have copies. We acknowledge receipt for identification and proper accounting of records,” Leal said.

According to Garcia, a second instruction was emailed by Leal to the BSP head examiner, lawyer Elmer Damasco, on Nov. 24, 2010, a day before the exit conference of the examination, to submit the account opening forms and signature specimen cards of 112 sample accounts plus eight more.

Garcia pointed out that the eight accounts, including Corona’s, were identified by Leal because of the need to tag them as “politically exposed persons.”

Quoting the email, a copy of which was furnished to the compliance officer of PSBank, Garcia said that Leal furnished an advance copy of his findings to the bank for compliance “so that they can prepare for the meeting tomorrow (Nov. 25, 2010), the exit conference for the examination.”

Leal said that the documents were only presented to him for review but that these were returned to the bank.

He maintained that the BSP does not have copies of the signature cards because it does not require these for its examinations.

But when asked by Senate committee on banks, financial institutions and currencies chairman Sergio Osmeña III if he had ever taken any copy outside the premises of the bank, Leal admitted that he had for “some accounts with major findings wherein we need proof.”

Osmeña also asked Leal if he had made copies of the screenshots of the account information of the bank’s clients. Leal said that he did not because it was the bank which made the copies for him.

Eventually, Leal admitted that he did bring out copies of signature cards that were shown to him by PSBank.

PSBank’s internal audit head Emma Co confirmed the claims of Garcia, saying that she was present during the exit conference on Nov. 25 when the documents were turned over to Leal.

PSBank, however, was not able to provide any documentation of Leal’s receipt of the documents. Garcia said that it was most likely just an oversight on their part because they had to rush the completion of the requirements of the BSP. Both Garcia and Leal said that they were willing to undergo a polygraph or lie detector test to determine who was telling the truth.

At this point, Enrile declared he was convinced that Leal was lying.

“I am convinced that this man is lying. With all my years of law practice, I know when a person is lying,” Enrile said, referring to Leal.

Enrile said Leal may have also been the source of the leaked documents.

Osmeña directed Leal to explain to the committee why he should not be cited for contempt for allegedly trying to deceive the senators.

He said that a meeting among the members of the committee would be held on Monday to discuss whether Leal would be cited for contempt.

Enrile said Leal should stay in detention at the Senate until he decides to tell the truth.

“We’re having a problem in the impeachment court, to tell you the truth. We are going to judge a person, one of the highest officials of the country, recognized by the world as a chief justice of this country. And we are now in a quandary on how to deal with this problem,” Enrile said. “We are ready to exercise our duties to convict him on the basis of evidence presented if those evidence are indeed authentic, genuine.”

Enrile also said he was surprised that the BSP did not investigate the matter, considering its potentially adverse impact on the local banking sector.

The issue of Corona’s bank accounts with PSBank emerged after the prosecution panel in his impeachment trial attached copies of these documents to its supplemental request for subpoena on the bank records of the Chief Justice.

The prosecution claimed the documents came from an anonymous source. Garcia and PSBank Katipunan branch manager Annabelle Tiongson had claimed the attached document was fake.

Garcia earlier cited 42 distinct differences between the attached document and the original document held by the bank.

During yesterday’s hearing, Garcia pointed out that one of the differences was that the photocopied document attached by the prosecution bore indications that the signatures were traced.

Garcia did not deny that the information contained in the attached document was a result of a leak of information contained in the original documents held by the bank.

However, he said that the bank is “very confident that if submitted for technical analysis, the document submitted to the impeachment court is not a photocopy of the original.”

Enrile said that Leal faces up to five years imprisonment for violating the bank secrecy laws if it is proven that he was behind the leak.

When sought for comment, BSP deputy governor Nestor Espenilla Jr. said they will submit a report on the matter to the Senate.