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Banking Finals Samplex 4.

What is the purpose for the enactment of the


Unclaimed Balances Law (RA 3936)
1. Discuss the State Policy for the enactment of the
Unclaimed Balances Law is one of the government’s fund
New Central Bank Act (RA 7653)
generating laws wherein millions of unclaimed pesos are
collected and deposited at the Bureau of Treasury and
“The State shall maintain a ​central monetary authority
are credited in favor of the National Government every
that shall function and operate as an ​independent and
year. The purpose of which is so that the unclaimed
accountable body corporate in the discharge of its
balances will be able to be in circulation and be used by
mandated responsibilities concerning ​money​, ​banking​,
the government for public purpose as the National
and ​credit​. In line with this policy, and considering its
Assembly may direct.
unique functions and responsibilities, the central
monetary authority established under this Act, while
5. Mr. Jose Mangilit is an employee of Union Carbon
being a government-owned corporation, shall enjoy
Philippines, Inc., a large manufacturing company
fiscal​ and ​administrative autonomy​.”
based in Makati. He earns a salary which is just a bit
more than what he needs for a comfortable living. He
is thus able to still maintain a P10,000.00 savings
2. What are the grounds for the appointment of a
account, a P20,000.00 checking account, a
conservator under the New Central Bank Act?
P50,000.00 money market placement and a
P100,000.00 trust fund in Bombo Bank, a
The bank or a quasi bank is in a state of (1) ​continuing
medium-size commercial bank.
inability ​or (2) ​unwillingness ​to maintain a condition
a. State which of the four accounts are deemed
of liquidity ​deemed adequate to protect the interest of
insured by the Philippine Deposit Insurance
depositors and creditors. ​(Sec. 29, RA 7653)
Corporation
3. Distinguish “covered transaction” from
The P10,000.00 savings account and the P20,000.00
“suspicious transaction” under the Anti-Money
checking account are insured with the Philippine Deposit
Laundering Act
Insurance Corporation. The term ​“deposit” means the
unpaid balance of money or ​its equivalent ​received by a
Covered Transactions - ​every transaction in cash or
bank in the ​usual course of business and ​for which it has
other equivalent monetary instrument involving a total
given or is obliged to give credit to a​: (CCS-TT-PD)
amount ​in excess of five hundred thousand pesos
a. C​ommercial,
(P500,000.00) within one (1) banking day
b. C​hecking,
c. S​avings,
Suspicious Transactions - those transactions with
d. T​ime, or
covered institutions, regardless of the amounts involved,
e. T​hrift account, or
where any of the following circumstances exist:
f. Which is evidenced by ​p​assbook check and/or
(DUA-LICA)
certificate of deposit, printed or issued in
1. There is ​no underlying ​l​egal or trade
accordance with Central Bank rules and
obligation​​, ​purpose ​or ​economic justification​​;
regulations and other applicable laws,
2. The ​client ​is ​not properly ​i​dentified​​;
g. Together with such other obligations of a bank,
3. The ​amount involved is ​not ​c​ommensurate
which, consistent with banking usage and
with the business or financial capacity of the
practices, the Board of ​D​irectors shall ​d​etermine
client;
and prescribe by regulations to deposit
4. Taking into account all known circumstances, it
liabilities of the Bank.
may be perceived that the client’s transaction
is ​structured ​in order ​to ​a​void ​being the
b. State which of the above accounts covered by
subject of ​reporting requirements under the
the Law on Secrecy of Bank Deposits
Act (AMLA);
5. Any circumstance relating to the ​transaction
which is observed to ​d​eviate ​from the profile of The P10,000.00 savings account and the P20,000.00
the client and/or the ​client’s past checking account are covered by the Law on Secrecy of
transactions​​ with the covered institution; Bank Deposits. ​All deposits of whatever nature with
6. The transaction is in any way ​related to an banks or banking institutions in the Philippines
u​​nlawful activity or offense that is about to be, including investments in bonds issued by the
is being or has been committed; or Government of the Philippines, its political subdivisions
7. Any transaction that is similar or ​a​nalogous ​to and its instrumentalities, ​are considered as of an
any of the foregoing. absolutely confidential nature and ​may not be examined​,
inquired or looked into by any ​person, government
official, bureau or office​.
6. When Orient Bank was ordered closed by the countries, making deposits and withdrawals to
Bangko Sentral ng Pilipinas on April 15, 2013, Mario continually vary the amount of money in the accounts,
Daez had three (3) separate deposit accounts in his changing the money’s currency, and purchasing
name with the said Bank, namely: P200,000 in time high-value items (boats, houses, cars, diamonds) to
deposit; P100,000 in current deposit; and P50,000 in change the form of the money. This is the ​most complex
savings deposit. Under the PDIC law, how much, if step in any laundering scheme, and ​it’s all about making
any, could he recover from each of the three (3) the original dirty money as hard to trace as possible​.
separate accounts? Explain.
“Integration” - ​the ​money re-enters the mainstream
Under the PDIC Law, she can only recover the aggregate economy in legitimate-looking form -- it appears to come
amount of P250,000.00 which is the maximum amount from a legal transaction. This may involve a final bank
of insurance of any depositor. transfer into the account of a local business in which the
launderer is “investing” in exchange for a cut of the
7. Mr. Xavier Montinola as the President of Xamon profits, the sale of a yacht bought during the layering
Trading, Inc. executed a trust receipt in favor of the stage or the purchase of a $10 million screwdriver from
Bank of the Philippine Islands (BPI) to secure the a company owned by the launderer. At this point, the
importation by his company of certain goods. After criminal can use the money without getting caught. It’s
release and sale of the imported goods, the proceeds very difficult to catch a launderer during the
from the sale were not turned over to BPI. Would BPI integration stage ​if there is no documentation during
be justified in filing a case of estafa against the previous stages​.
Montinola? Explain.
10. Under the Anti-Money Laundering Act, discuss
Yes. BPI would be justified in filing a case for estafa the meaning of the “Safe Harbor Provision”
against Mr. Xavier Montinola. The ​failure of an entrustee
to ​turn over the proceeds of the sale of goods, documents Safe Harbor Provision: ​No administrative, criminal or
or instruments covered by a trust receipt to the extent of civil proceedings shall lie ​against any person for having
the amount owing to the entruster or as appears in the made a covered transaction report in the ​regular
trust receipt or to return said goods, documents or performance of his duties and in good faith​, whether or
instruments if they were not sold or disposed of in not such reporting results in any criminal prosecution
accordance with the terms of the trust receipt under the AMLA or any other Philippine law. ​(Rules and
constitutes estafa​​. Moreover, ​if the violation or offense Regulations Implementing the Anti-Money Laundering
is committed by a corporation, partnership, association Act of 2001)
or other juridical entities​, the penalty is imposed upon
the ​directors​​, ​officers​​, ​employees ​or ​other officials or
persons responsible for the offense​​. ​(Sia v. Court of
Appeals ​and ​Section 13, PD 115)

8. Explain the rationale for the restrictions on DOSRI


accounts under the General Banking Law of 2000.

In view of its fiduciary responsibility over funds


borrowed from the public, the DOSRI parties should not
lend these funds, in an amount exceeding their capital, to
themselves. To do so would be irregular as it would
constitute s​elf-dealing​​ or an​ insider transaction​​.

9. Under the Anti-Money Laundering Act, what is the


meaning of (a) Placement; (b) Layering; and (c)
Integration?

“Placement” - Stage in Money Laundering where the


launderer inserts the dirty money into a legitimate
financial institution. This is often in the form of cash
bank deposits. This is the ​riskiest stage of the
laundering process because ​large amounts of cash are
pretty conspicuous​, and ​banks are required to report
high-value transactions​.

“Layering” - ​involves ​sending the money through


various financial transactions to change its form and
make it difficult to follow​. Layering may consist of
several bank-to-bank transfer, wire transfers between
different accounts in different names in different