EN BANC

G.R. No. 216914, December 06, 2016

SUBIDO PAGENTE CERTEZA MENDOZA AND BINAY LAW
OFFICES, Petitioner, v. THE COURT OF APPEALS, HON. ANDRES B. REYES, JR., IN
HIS CAPACITY AS PRESIDING JUSTICE OF THE COURT OF APPEALS, AND THE
ANTI-MONEY LAUNDERING COUNCIL, REPRESENTED BY ITS MEMBERS, HON.
AMANDO M. TETANGCO, JR., GOVERNOR OF THE BANGKO SENTRAL NG
PILIPINAS, HON. TERESITA J. HERBOSA, CHAIRPERSON OF THE SECURITIES
AND EXCHANGE COMMISSION, AND HON. EMMANUEL F. DOOC, INSURANCE
COMMISSIONER OF THE INSURANCE COMMISSION, Respondents.
DECISION
PEREZ, J.:
Challenged in this petition for certiorari1 and prohibition under Rule 65 of the Rules of
Court is the constitutionality of Section 11 of Republic Act (R.A.) No. 9160, the Anti-
Money Laundering Act, as amended, specifically the Anti-Money Laundering Council's
authority to file with the Court of Appeals (CA) in this case, an ex-parte application for
inquiry into certain bank deposits and investments, including related accounts based on
probable cause.
In 2015, a year before the 2016 presidential elections, reports abounded on the
supposed disproportionate wealth of then Vice President Jejomar Binay and the rest of
his family, some of whom were likewise elected public officers. The Office of the
Ombudsman and the Senate conducted investigations2 and inquiries3 thereon ostensibly
based on their respective powers delineated in the Constitution.
From various news reports announcing the inquiry into then Vice President Binay's bank
accounts, including accounts of members of his family, petitioner Subido Pagente
Certeza Mendoza & Binay Law Firm (SPCMB) was most concerned with the article
published in the Manila Times on 25 February 2015 entitled "Inspect Binay Bank
Accounts" which read, in pertinent part:
xxx The Anti-Money Laundering Council (AMLC) asked the Court of Appeals (CA) to
allow the [C]ouncil to peek into the bank accounts of the Binays, their corporations,
and a law office where a family member was once a partner.
xxxx
Also the bank accounts of the law office linked to the family, the Subido Pagente
Certeza Mendoza & Binay Law Firm, where the Vice President's daughter Abigail
was a former partner.4
The following day, 26 February 2015, SPCMB wrote public respondent, Presiding Justice
of the CA, Andres B. Reyes, Jr.:
The law firm of Subido Pagente Certeza Mendoza and Binay was surprised to receive a
call from Manila Times requesting for a comment regarding a [supposed petition] filed
by the Republic of the Philippines represented by the Anti-Money Laundering Council
before the Court of Appeals seeking to examine the law office's bank accounts.
To verify the said matter, the law office is authorizing its associate Atty. Jose Julius R.
Castro to inquire on the veracity of said report with the Court of Appeals. He is likewise
authorized to secure copies of the relevant documents of the case, such as the petition
and orders issued, if such a case exists.
As this is a matter demanding serious and immediate attention, the Firm respectfully
manifests that if no written response is received within 24-hours from receipt of this
letter, we shall be at liberty to assume that such a case exists and we shall act
accordingly.
Hoping for your immediate action.
Respectfully yours,
  For the Firm  
CLARO F. CERTEZA5
Within twenty four (24) hours, Presiding Justice Reyes wrote SPCMB denying its
request, thus:
Anent your request for a comment on a supposed petition to inquire into your law
office's bank accounts, please be informed that a petition of this nature is strictly
confidential in that when processing the same, not even the handling staff members of
the Office of the Presiding Justice know or have any knowledge who the subject bank
account holders are, as well as the bank accounts involved.
Please be informed further that clearly under the rules, the Office of the Presiding
Justice is strictly mandated not to disclose, divulge, or communicate to anyone directly
or indirectly, in any manner or by any means, the fact of the filing of any petition
brought before this Court by the Anti-Money Laundering Council, its contents and even
its entry in the logbook.
Trusting that you find satisfactory the foregoing explanation.6
By 8 March 2015, the Manila Times published another article entitled, "CA orders probe
of Binay's assets" reporting that the appellate court had issued a Resolution granting
the ex-parte application of the AMLC to examine the bank accounts of SPCMB:
The Court of Appeals (CA) has officially issued an order for examination of Vice
President Jejomar Binay's bank accounts.
In granting the petition of the Anti-Money Laundering Council (AMLC), the CA also
ordered the inspection of the bank deposits of Binay's wife, children, and a law office
connected to him.
xxx xxx xxx
The bank accounts of the law office linked to Binay - the Subido Pagente Certeza
Mendoza & Binay where Binay's daughter, Makati City (Metro Manila) Rep. Mar-len
Abigail Binay was a partner, are also included in the probe, the sources said.7
Forestalled in the CA thus alleging that it had no ordinary, plain, speedy, and adequate
remedy to protect its rights and interests in the purported ongoing unconstitutional
examination of its bank accounts by public respondent Anti-Money Laundering Council
(AMLC), SPCMB undertook direct resort to this Court via this petition for certiorari and
prohibition on the following grounds:
A. THE ANTI-MONEY LAUNDERING ACT IS UNCONSTITUTIONAL INSOFAR AS IT
ALLOWS THE EXAMINATION OF A BANK ACCOUNT WITHOUT ANY NOTICE TO
THE AFFECTED PARTY: cralawlawlibrary

1. IT VIOLATES THE PERSON'S RIGHT TO DUE PROCESS; AND

   

2. IT VIOLATES THE PERSON'S RIGHT TO PRIVACY.

 B. EVEN ASSUMING ARGUENDO THAT THE ANTI-MONEY LAUNDERING ACT IS
CONSTITUTIONAL, THE RESPONDENTS COMMITTED GRAVE ABUSE OF
DISCRETION AMOUNTING TO LACK OR EXCESS OF JURISDICTION
CONSIDERING THAT: cralawlawlibrary

1. THE REFUSAL OF RESPONDENT PRESIDING JUSTICE TO PROVIDE PETITIONER

WITH A COPY OF THE EX-PARTE APPLICATION FOR BANK EXAMINATION
FILED BY RESPONDENT AMLC AND ALL OTHER PLEADINGS, MOTIONS,
ORDERS, RESOLUTIONS, AND PROCESSES ISSUED BY THE RESPONDENT
COURT OF APPEALS IN RELATION THERETO VIOLATES PETITIONER'S RIGHT
TO DUE PROCESS;
   
2. A CARTE BLANCHE AUTHORITY TO EXAMINE ANY AND ALL TRANSACTIONS
PERTAINING TO PETITIONER'S BANK ACCOUNTS VIOLATES THE ATTORNEY-
CLIENT PRIVILEGE WHICH IS SACROSANCT IN THE LEGAL PROFESSION;
   
3. A BLANKET AUTHORITY TO EXAMINE PETITIONER'S BANK ACCOUNTS,
INCLUDING ANY AND ALL TRANSACTIONS THEREIN FROM ITS OPENING UP
TO THE PRESENT, PARTAKES THE NATURE OF A GENERAL WARRANT THAT
IS CLEARLY INTENDED TO AID A MERE FISHING EXPEDITION;
   
4. THERE IS NOTHING IN THE ANTI-MONEY LAUNDERING ACT THAT ALLOWS
OR JUSTIFIES THE WITHHOLDING OF INFORMATION AND/OR ANY COURT
RECORDS OR PROCEEDINGS PERTAINING TO AN EXAMINATION OF A BANK
ACCOUNT, ESPECIALLY IF THE COURT HAS ALREADY GRANTED THE
AUTHORITY TO CONDUCT THE EXAMINATION;
   
5. THE PETITIONER DID NOT COMMIT, NOR HAS THE PETITIONER BEEN
IMPLEADED IN ANY COMPLAINT INVOLVING ANY PREDICATE CRIME THAT
WOULD JUSTIFY AN INQUIRY INTO ITS BANK ACCOUNTS; AND
   
7. THE EXAMINATION OF THE PETITIONER'S BANK ACCOUNTS IS A FORM OF
POLITICAL PERSECUTION OR HARASSMENT.8
In their Comment, the AMLC, through the Office of the Solicitor General (OSG), points
out a supposed jurisdictional defect of the instant petition, i.e., SPCMB failed to implead
the House of Representatives which enacted the AMLA and its amendments. In all, the
OSG argues for the dismissal of the present petition, highlighting that the AMLC's
inquiry into bank deposits does not violate due process nor the right to privacy:
1. Section 11's allowance for AMLC's ex-parte application for an inquiry into particular
bank deposits and investments is investigative, not adjudicatory;
2. The text of Section 11 itself provides safeguards and limitations on the allowance to
the AMLC to inquire into bank deposits: (a) issued by the CA based on probable cause;
and (b) specific compliance to the requirements of Sections 2 and 3, Article III of the
Constitution;
3. The ex-parte procedure for investigating bank accounts is necessary to achieve a
legitimate state objective;
4. There is no legitimate expectation of privacy as to the bank records of a depositor;
5. The examination of, and inquiry, into SPCMB's bank accounts does not violate
Attorney-Client Privilege; and
6. A criminal complaint is not a pre-requisite to a bank inquiry order.
In their Reply, SPCMB maintains that the ex-parte proceedings authorizing inquiry of
the AMLC into certain bank deposits and investments is unconstitutional, violating its
rights to due process and privacy.
Before anything else, we here have an original action turning on three crucial matters:
(1) the petition reaches us from a letter of the Presiding Justice of the CA in response to
a letter written by SPCMB; (2) SPCMB's bank account has been reported to be a related
account to Vice President Binay's investigated by the AMLC for anti-money laundering
activities; and (3) the constitutionality of Section 11 of the AMLA at its recent
amendment has not been squarely raised and addressed.
To obviate confusion, we act on this petition given that SPCMB directly assails the
constitutionality of Section 11 of the AMLA where it has been widely reported that Vice
President Binay's bank accounts and all related accounts therewith are subject of an
investigation by the AMLC. In fact, subsequent events from the filing of this petition
have shown that these same bank accounts (including related accounts) were
investigated by the Ombudsman and both Houses of the Legislature. However, at the
time of the filing of this petition, SPCMB alleged that its accounts have been inquired
into but not subjected to a freeze order under Section 10 of the AMLA. Thus, as
previously noted, with its preclusion of legal remedies before the CA which under the
AMLA issues the ex-parte bank inquiry and freeze orders, Sections 10 and 11,
respectively, SPCMB establishes that it has no plain, speedy and adequate remedy in
the ordinary course of law to protect its rights and interests from the purported
unconstitutional intrusion by the AMLC into its bank accounts.
The foregoing shall be addressed specifically and bears directly on the disposition of the
decision herein.
Additionally, we note that the OSG did not question how this petition reaches us from a
letter of the appellate court's Presiding Justice, only that, procedurally, SPCMB should
have impleaded Congress.
On the sole procedural issue of whether SPCMB ought to have impleaded Congress, the
contention of the OSG though novel is untenable. All cases questioning the
constitutionality of a law does not require that Congress be impleaded for their
resolution. The requisites of a judicial inquiry are elementary:
1. There must be an actual case or controversy; party;
2. The question of constitutionality must be raised by the proper party;
3. The constitutional question must be raised at the earliest possible opportunity; and
4. The decision of the constitutional question must be necessary to the determination of
the case itself.9
The complexity of the issues involved herein require us to examine the assailed
provision vis-a-vis the constitutional proscription against violation of due process. The
statute reads:
SEC. 11. Authority to Inquire into Bank Deposits. - Notwithstanding the provisions of
Republic Act No. 1405, as amended; Republic Act No. 6426, as amended; Republic Act
No. 8791; and other laws, the AMLC may inquire into or examine any particular deposit
or investment, including related accounts, with any banking institution or non-bank
financial institution upon order of any competent court based on an ex parte application
in cases of violations of this Act, when it has been established that there is probable
cause that the deposits or investments, including related accounts involved, are related
to an unlawful activity as defined in Section 3(i) hereof or a money laundering offense
under Section 4 hereof; except that no court order shall be required in cases involving
activities defined in Section 3(i)(1), (2), and (12) hereof, and felonies or offenses of a
nature similar to those mentioned in Section 3(i)(1), (2), and (12), which are
punishable under the penal laws of other countries, and terrorism and conspiracy to
commit terrorism as defined and penalized under Republic Act No. 9372.
The Court of Appeals shall act on the application to inquire into or examine any deposit
or investment with any banking institution or non-bank financial institution within
twenty-four (24) hours from filing of the application.
To ensure compliance with this Act, the Bangko Sentral ng Pilipinas may, in the course
of a periodic or special examination, check the compliance of a covered institution with
the requirements of the AMLA and its implementing rules and regulations.
For purposes of this section, 'related accounts' shall refer to accounts, the funds and
sources of which originated from and/or are materially linked to the monetary
instrument(s) or property(ies) subject of the freeze order(s).
A court order ex parte must first be obtained before the AMLC can inquire into these
related Accounts: Provided, That the procedure for the ex parte application of the ex
parte court order for the principal account shall be the same with that of the related
accounts.
The authority to inquire into or examine the main account and the related accounts
shall comply with the requirements of Article III, Sections 2 and 3 of the 1987
Constitution, which are hereby incorporated by reference.10
The due process clause of the Constitution reads:
SECTION 1. No person shall be deprived of life, liberty or property without due process
of law, nor shall any person be denied the equal protection of the laws. 11
The right to due process has two aspects: (1) substantive which deals with the extrinsic
and intrinsic validity of the law; and (2) procedural which delves into the rules
government must follow before it deprives a person of its life, liberty or property.12
As presently worded, Section 11 of the AMLA has three elements: (1) ex-
parte application by the AMLC; (2) determination of probable cause by the CA; and (3)
exception of court order in cases involving unlawful activities defined in Sections 3(i)
(1), (2), and (12).
As a brief backgrounder to the amendment to Section 11 of the AMLA, the text
originally did not specify for an ex-parte application by the AMLC for authority to inquire
into or examine certain bank accounts or investments. The extent of this authority was
the topic of Rep. of the Phils. v. Hon. Judge Eugenio, Jr., et al. (Eugenio) 13 where the
petitioner therein, Republic of the Philippines, asseverated that the application for that
kind of order under the questioned section of the AMLA did not require notice and
hearing. Eugenio schooled us on the AMLA, specifically on the provisional remedies
provided therein to aid the AMLC in enforcing the law:
It is evident that Section 11 does not specifically authorize, as a general rule, the
issuance ex-parte of the bank inquiry order. We quote the provision in full:
SEC. 11. Authority to Inquire into Bank Deposits. — Notwithstanding the
provisions of Republic Act No. 1405, as amended, Republic Act No. 6426, as amended,
Republic Act No. 8791, and other laws, the AMLC may inquire into or examine any
particular deposit or investment with any banking institution or non bank financial
institution upon order of any competent court in cases of violation of this Act, when it
has been established that there is probable cause that the deposits or
investments are related to an unlawful activity as defined in Section 3(i)
hereof or a money laundering offense under Section 4 hereof, except that no
court order shall be required in cases involving unlawful activities defined in
Sections 3(i)1, (2) and (12).
To ensure compliance with this Act, the Bangko Sentral ng Pilipinas (BSP) may inquire
into or examine any deposit of investment with any banking institution or non bank
financial institution when the examination is made in the course of a periodic or special
examination, in accordance with the rules of examination of the BSP. (Emphasis
supplied)
Of course, Section 11 also allows the AMLC to inquire into bank accounts without having
to obtain a judicial order in cases where there is probable cause that the deposits or
investments are related to kidnapping for ransom, certain violations of the
Comprehensive Dangerous Drugs Act of 2002, hijacking and other violations under R.A.
No. 6235, destructive arson and murder. Since such special circumstances do not apply
in this case, there is no need for us to pass comment on this proviso. Suffice it to say,
the proviso contemplates a situation distinct from that which presently confronts us,
and for purposes of the succeeding discussion, our reference to Section 11 of the AMLA
excludes said proviso.
In the instances where a court order is required for the issuance of the bank inquiry
order, nothing in Section 11 specifically authorizes that such court order may be
issued ex parte. It might be argued that this silence does not preclude the ex
parte issuance of the bank inquiry order since the same is not prohibited under Section
11. Yet this argument falls when the immediately preceding provision, Section 10, is
examined.
SEC 10. Freezing of Monetary Instrument or Property. — The Court of
Appeals, upon application ex parte by the AMLC and after determination that
probable cause exists that any monetary instrument or property is in any way related
to an unlawful activity as defined in Section 3(i) hereof, may issue a freeze order
which shall be effective immediately. The freeze order shall be for a period of
twenty (20) days unless extended by the court.
Although oriented towards different purposes, the freeze order under Section 10 and
the bank inquiry order under Section 11 are similar in that they are extraordinary
provisional reliefs which the AMLC may avail of to effectively combat and prosecute
money laundering offenses. Crucially, Section 10 uses specific language to authorize
an ex parte application for the provisional relief therein, a circumstance absent in
Section 11. If indeed the legislature had intended to authorize ex parte proceedings for
the issuance of the bank inquiry order, then it could have easily expressed such intent
in the law, as it did with the freeze order under Section 10.
Even more tellingly, the current language of Sections 10 and 11 of the AMLA was
crafted at the same time, through the passage of R.A. No. 9194. Prior to the
amendatory law, it was the AMLC, not the Court of Appeals, which had authority to
issue a freeze order, whereas a bank inquiry order always then required, without
exception, an order from a competent court. It was through the same enactment
that ex parte proceedings were introduced for the first time into the AMLA, in the case
of the freeze order which now can only be issued by the Court of Appeals. It certainly
would have been convenient, through the same amendatory law, to allow a similar ex
parte procedure in the case of a bank inquiry order had Congress been so minded. Yet
nothing in the provision itself, or even the available legislative record, explicitly points
to an ex parte  judicial procedure in the application for a bank inquiry order, unlike in
the case of the freeze order.
That the AMLA does not contemplate  ex parte proceedings in applications for bank
inquiry orders is confirmed by the present implementing rules and regulations of the
AMLA, promulgated upon the passage of R.A. No. 9194. With respect to freeze orders
under Section 10, the implementing rules do expressly provide that the applications for
freeze orders be filed  ex parte, but no similar clearance is granted in the case of inquiry
orders under Section 11. These implementing rules were promulgated by the Bangko
Sentral ng Pilipinas, the Insurance Commission and the Securities and Exchange
Commission, and if it was the true belief of these institutions that inquiry orders could
be issued ex parte similar to freeze orders, language to that effect would have been
incorporated in the said Rules. This is stressed not because the implementing rules
could authorize ex parte applications for inquiry orders despite the absence of statutory
basis, but rather because the framers of the law had no intention to allow such ex
parte applications.
Even the Rules of Procedure adopted by this Court in A.M. No. 05-11-04-SC to enforce
the provisions of the AMLA specifically authorize ex parte applications with respect to
freeze orders under Section 10 but make no similar authorization with respect to bank
inquiry orders under Section 11.
The Court could divine the sense in allowing ex parte proceedings under Section 10 and
in proscribing the same under Section 11. A freeze order under Section 10 on the one
hand is aimed at preserving monetary instruments or property in any way deemed
related to unlawful activities as defined in Section 3(i) of the AMLA. The owner of such
monetary instruments or property would thus be inhibited from utilizing the same for
the duration of the freeze order. To make such freeze order anteceded by a judicial
proceeding with notice to the account holder would allow for or lead to the dissipation
of such funds even before the order could be issued. (Citations omitted.)
Quite apparent from the foregoing is that absent a specific wording in the AMLA
allowing for ex-parte proceedings in orders authorizing inquiry and examination by the
AMLC into certain bank deposits or investments, notice to the affected party is required.
Heeding the Court's observance in Eugenio that the remedy of the Republic then lay
with the legislative, Congress enacted Republic Act No. 10167 amending Section 11 of
the AMLA and specifically inserted the word ex-parte appositive of the nature of this
provisional remedy available to the AMLC thereunder.
It is this current wording of Section 11 which SPCMB posits as unconstitutional and
purportedly actually proscribed in Eugenio.
We do not subscribe to SPCMB's position.
Succinctly, Section 11 of the AMLA providing for ex-parte application and inquiry by the
AMLC into certain bank deposits and investments does not violate substantive due
process, there being no physical seizure of property involved at that stage. It is the
preliminary and actual seizure of the bank deposits or investments in question which
brings these within reach of the judicial process, specifically a determination that the
seizure violated due process.14 In fact, Eugenio delineates a bank inquiry order under
Section 11 from a freeze order under Section 10 on both remedies' effect on the direct
objects,  i.e. the bank deposits and investments:
On the other hand, a bank inquiry order under Section 11 does not necessitate any
form of physical seizure of property of the account holder. What the bank inquiry order
authorizes is the examination of the particular deposits or investments in banking
institutions or non-bank financial institutions. The monetary instruments or property
deposited with such banks or financial institutions are not seized in a physical sense,
but are examined on particular details such as the account holder's record of deposits
and transactions. Unlike the assets subject of the freeze order, the records to be
inspected under a bank inquiry order cannot be physically seized or hidden by the
account holder. Said records are in the possession of the bank and therefore cannot be
destroyed at the instance of the account holder alone as that would require the
extraordinary cooperation and devotion of the bank.15
At the stage in which the petition was filed before us, the inquiry into certain bank
deposits and investments by the AMLC still does not contemplate any form of physical
seizure of the targeted corporeal property. From this cite, we proceed to examine
whether Section 11 of the law violates procedural due process.
As previously stated, the AMLA now specifically provides for an ex-parte application for
an order authorizing inquiry or examination into bank deposits or investments which
continues to pass constitutional muster.
Procedural due process is essentially the opportunity to be heard.16 In this case, at the
investigation stage by the AMLC into possible money laundering offenses, SPCMB
demands that it have notice and hearing of AMLC's investigation into its bank accounts.
We are not unaware of the obiter in Eugenio17 and cited by SPCMB, voicing misgivings
on an interpretation of the former Section 11 of the AMLA allowing for ex-
parte proceedings in bank inquiry orders, to wit:
There certainly is fertile ground to contest the issuance of an ex-parte order. Section 11
itself requires that it be established that "there is probable cause that the deposits or
investments are related to unlawful activities," and it obviously is the court which
stands as arbiter whether there is indeed such probable cause. The process of inquiring
into the existence of probable cause would involve the function of determination
reposed on the trial court. Determination clearly implies a function of adjudication on
the part of the trial court, and not a mechanical application of a standard pre-
determination by some other body. The word "determination" implies deliberation and
is, in normal legal contemplation, equivalent to "the decision of a court of justice."
The court receiving the application for inquiry order cannot simply take the AMLC's
word that probable cause exists that the deposits or investments are related to an
unlawful activity. It will have to exercise its own determinative function in order to be
convinced of such fact. The account holder would be certainly capable of
contesting such probable cause if given the opportunity to be apprised of the
pending application to inquire into his account; hence a notice requirement
would not be an empty spectacle. It may be so that the process of obtaining the
inquiry order may become more cumbersome or prolonged because of the notice
requirement, yet we fail to see any unreasonable burden cast by such circumstance.
After all, as earlier stated, requiring notice to the account holder should not, in any
way, compromise the integrity of the bank records subject of the inquiry which remain
in the possession and control of the bank. (Emphasis supplied)
On that score, the SPCMB points out that the AMLC 's bank inquiry is preliminary to the
seizure and deprivation of its property as in a freeze order under Section 10 of the
AMLA which peculiarity lends itself to a sui generis proceeding akin to the evaluation
process in extradition proceedings pronounced in Secretary of Justice v. Hon.
Lantion.18 Under the extradition law, the Secretary of Foreign Affairs is bound to make a
finding that the extradition request and its supporting documents are sufficient and
complete in form and substance before delivering the same to the Secretary of Justice.
We ruled:
[L]ooking at the factual milieu of the case before us, it would appear that there was
failure to abide by the provisions of Presidential Decree No. 1069. For while it is true
that the extradition request was delivered to the Department of Foreign Affairs on June
17, 1999, the following day or less than 24 hours later, the Department of Justice
received the request, apparently without the Department of Foreign affairs discharging
its duty thoroughly evaluating the same and its accompanying documents. xxx.
xxxx
[T]he record cannot support the presumption of regularity that the Department of
Foreign Affairs thoroughly reviewed the extradition request and supporting documents
and that it arrived at a well-founded judgment that the request and its annexed
documents satisfy the requirements of law. XXX.
The evaluation process, just like the extradition proceedings, proper belongs
to a class by itself. It is sui generis. It is not a criminal investigation, but it is
also erroneous to say that it is purely an exercise of ministerial functions. At
such stage, the executive authority has the power: (a) to make a technical
assessment of the completeness and sufficiency of the extradition papers; (b)
to outrightly deny the request if on its face and on the face of the supporting
documents the crimes indicated are not extraditable; and (c) to make a
determination whether or not the request is politically motivated, or that the
offense is a military one which is not punishable under non-military penal
legislation. Hence, said process may be characterized as an investigative or
inquisitorial process in contrast to a proceeding conducted in the exercise of
an administrative body's quasi-judicial power.
In administrative law, a quasi-judicial proceeding involves: (a) taking and evaluation of
evidence; (b) determining facts based upon the evidence presented; and (c) rendering
an order or decision supported by the facts proved. Inquisitorial power, which is also
known as examining or investigatory power, is one of the determinative powers of an
administrative body which better enables it to exercise its quasi-judicial authority. This
power allows the administrative body to inspect the records and premises, and
investigate the activities, of persons or entities coming under its jurisdiction, or to
require disclosure of information by means of accounts, records, reports, testimony of
witnesses, production of documents, or otherwise.
The power of investigation consists in gathering, organizing, and analyzing evidence,
which is a useful aid or tool in an administrative agency's performance of its rule-
making or quasi-judicial functions. Notably, investigation is indispensable to
prosecution.19 (Emphasis supplied, citations omitted)
The submission of AMLC requires a determination whether the AMLC is an
administrative body with quasi-judicial powers; corollary thereto, a determination of the
jurisdiction of the AMLC.
Lim v. Gamosa20 is enlightening on jurisdiction and the requirement of a specific grant
thereof in the enabling law. We declared that the creation of the National Commission
on Indigenous Peoples (NCIP) by the Indigenous Peoples Rights Act (IPRA) did not
confer it exclusive and original, nor primary jurisdiction, in all claims and disputes
involving rights of IPs and ICCs where no such specific grant is bestowed.
In this instance, the grant of jurisdiction over cases involving money laundering
offences is bestowed on the Regional Trial Courts and the Sandiganbayan as the case
may be. In fact, Rule 5 of the IRR is entitled Jurisdiction of Money Laundering
Cases and Money Laundering Investigation Procedures:
Rule 5.a. Jurisdiction of Money Laundering Cases. The Regional Trial Courts shall
have the jurisdiction to try all cases on money laundering. Those committed by public
officers and private persons who are in conspiracy with such public officers shall be
under the jurisdiction of the Sandiganbayan.
Rule 5.b. Investigation of Money Laundering Offenses. - The AMLC shall
investigate:
(1) suspicious transactions;
(2) covered transactions deemed suspicious after an investigation conducted by the
AMLC;
(3) money laundering activities; and
(4) other violations of the AMLA, as amended.
The confusion on the scope and parameters of the AMLC's investigatory powers and
whether such seeps into and approximates a quasi-judicial agency's inquisitorial powers
lies in the AMLC's investigation and consequent initial determination of whether certain
activities are constitutive of anti-money laundering offenses.
The enabling law itself, the AMLA, specifies the jurisdiction of the trial courts, RTC and
Sandiganbayan, over money laundering cases, and delineates the investigative powers
of the AMLC.
Textually, the AMLA is the first line of defense against money laundering in compliance
with our international obligation. There are three (3) stages of determination, two (2)
levels of investigation, falling under three (3) jurisdictions:
1. The AMLC investigates possible money laundering offences and initially determines
whether there is probable cause to charge any person with a money laundering offence
under Section 4 of the AMLA, resulting in the filing of a complaint with the Department
of Justice or the Office of the Ombudsman;21
2. The DOJ or the Ombudsman conducts the preliminary investigation proceeding and if
after due notice and hearing finds probable cause for money laundering offences, shall
file the necessary information before the Regional Trial Courts or the Sandiganbayan;22
3. The RTCs or the Sandiganbayan shall try all cases on money laundering, as may be
applicable.23
Nowhere from the text of the law nor its Implementing Rules and Regulations can we
glean that the AMLC exercises quasi-judicial functions whether the actual preliminary
investigation is done simply at its behest or conducted by the Department of Justice
and the Ombudsman.
Again, we hark back to  Lantion  citing Ruperto v. Torres,23-a where the Court had
occasion to rule on the functions of an investigatory body with the sole power of
investigation:
[Such a body] does not exercise judicial functions and its power is limited to
investigating facts and making findings in respect thereto. The Court laid down the test
of determining whether an administrative body is exercising judicial functions or merely
investigatory functions: Adjudication signifies the exercise of power and authority to
adjudicate upon the rights and obligations of the parties before it. Hence, if the only
purpose for investigation is to evaluate evidence submitted before it based on the facts
and Circumstances presented to it, and if the agency is not authorized to make a final
pronouncement affecting the parties, then there is an absence of judicial discretion and
judgment.
adjudicate in regard to the rights and obligations of both the Requesting State and the
prospective extraditee. Its only power is to determine whether the papers comply with
the requirements of the law and the treaty and, therefore, sufficient to be the basis of
an extradition petition. Such finding is thus merely initial and not final. The body has no
power to determine whether or not the extradition should be effected. That is the role
of the court. The body's power is limited to an initial finding of whether or not the
extradition petition can be filed in court.
It is to be noted, however, that in contrast to ordinary investigations, the evaluation
procedure is characterized by certain peculiarities. Primarily, it sets into motion the
wheels of the extradition process. Ultimately, it may result in the deprivation of liberty
of the prospective extraditee. This deprivation can be effected at two stages: First, the
provisional arrest of the prospective extraditee pending the submission of the request.
This is so because the Treaty provides that in case of urgency, a contracting party may
request the provisional arrest of the person sought pending presentation of the request
(Paragraph [1], Article 9, RP-US Extradition Treaty), but he shall be automatically
discharged after 60 days if no request is submitted (Paragraph 4). Presidential Decree
No. 1069 provides for a shorter period of 20 days after which the arrested person could
be discharged (Section 20[d]). Logically, although the Extradition Law is silent on this
respect, the provisions only mean that once a request is forwarded to the Requested
State, the prospective extraditee may be continuously detained, or if not, subsequently
rearrested (Paragraph [5], Article 9, RP-US Extradition Treaty), for he will only be
discharged if no request is submitted. Practically, the purpose of this detention is to
prevent his possible flight from the Requested State. Second, the temporary arrest of
the prospective extraditee during the pendency of the extradition petition in court
(Section 6, Presidential Decree No. 1069).
Clearly, there is an impending threat to a prospective extraditee's liberty as early as
during the evaluation stage. It is not only an imagined threat to his liberty, but a very
imminent one.
Because of these possible consequences, we conclude that the evaluation process is
akin to an administrative agency conducting an investigative proceeding, the
consequences of which are essentially criminal since such technical assessment sets off
or commences the procedure for, and ultimately, the deprivation of liberty of a
prospective extraditee, As described by petitioner himself, this is a "tool" for criminal
law enforcement. In essence, therefore, the evaluation process partakes of the nature
of a criminal investigation. In a number of cases, we had occasion to make available to
a respondent in an administrative case or investigation certain constitutional rights that
are ordinarily available only in criminal prosecutions. Further, as pointed out by Mr.
Justice Mendoza during the oral arguments, there are rights formerly available only at
the trial stage that had been advanced to an earlier stage in the proceedings, such as
the right to counsel and the right against self-incrimination.24 (Citations omitted)
In contrast to the disposition in Lantion that the evaluation process before the
Department of Foreign Affairs is akin to an administrative agency conducting
investigative proceedings with implications on the consequences of criminal
liability, i.e., deprivation of liberty of a prospective extraditee, the sole investigative
functions of the AMLC finds more resonance with the investigative functions of the
National Bureau of Investigation (NBI).
That the AMLC does not exercise quasi-judicial powers and is simply an investigatory
body finds support in our ruling in Shu v. Dee.25 In that case, petitioner Shu had filed a
complaint before the NBI charging respondents therein with falsification of two (2)
deeds of real estate mortgage submitted to the Metropolitan Bank and Trust Company
(Metrobank). After its investigation, the NBI came up with a Questioned Documents
Report No. 746-1098 finding that the signatures of petitioner therein which appear on
the questioned deeds are not the same as the standard sample signatures he submitted
to the NBI. Ruling on the specific issue raised by respondent therein that they had been
denied due process during the NBI investigation, we stressed that the functions of this
agency are merely investigatory and informational in nature:
[The NBI] has no judicial or quasi-judicial powers and is incapable of granting any relief
to any party. It cannot even determine probable cause. The NBI is an investigative
agency whose findings are merely recommendatory. It undertakes investigation of
crimes upon its own initiative or as public welfare may require in accordance with its
mandate. It also renders assistance when requested in the investigation or detection of
crimes in order to prosecute the persons responsible.
Since the NBI's findings were merely recommendatory, we find that no denial of the
respondent's due process right could have taken place; the NBI's findings were still
subject to the prosecutor's and the Secretary of Justice's actions for purposes of finding
the existence of probable cause. We find it significant that the specimen signatures in
the possession of Metrobank were submitted by the respondents for the consideration
of the city prosecutor and eventually of the Secretary of Justice during the preliminary
investigation proceedings. Thus, these officers had the opportunity to examine these
signatures.
The respondents were not likewise denied their right to due process when the NBI
issued the questioned documents report. We note that this report merely stated that
the signatures appearing on the two deeds and in the petitioner's submitted sample
signatures were not written by one and the same person. Notably, there was no
categorical finding in the questioned documents report that the respondents falsified
the documents. This report, too, was procured during the conduct of the NBI's
investigation at the petitioner's request for assistance in the investigation of the alleged
crime of falsification. The report is inconclusive and does not prevent the respondents
from securing a separate documents examination by handwriting experts based on their
own evidence. On its own, the NBI's questioned documents report does not directly
point to the respondents' involvement in the crime charged. Its significance is that,
taken together with the other pieces of evidence submitted by the parties during the
preliminary investigation, these evidence could be sufficient for purposes of finding
probable cause — the action that the Secretary of Justice undertook in the present
case.
As carved out in Shu, the AMLC functions solely as an investigative body in the
instances mentioned in Rule 5.b.26 Thereafter, the next step is for the AMLC to file a
Complaint with either the DOJ or the Ombudsman pursuant to Rule 6.b.
Even in the case of Estrada v. Office of the Ombudsman,27 where the conflict arose at
the preliminary investigation stage by the Ombudsman, we ruled that the
Ombudsman's denial of Senator Estrada's Request to be furnished copies of the
counter-affidavits of his co-respondents did not violate Estrada's constitutional right to
due process where the sole issue is the existence of probable cause for the purpose of
determining whether an information should be filed and does not prevent Estrada from
requesting a copy of the counter-affidavits of his co-respondents during the pre-trial or
even during trial. We expounded on the nature of preliminary investigation proceedings,
thus:
It should be underscored that the conduct of a preliminary investigation is only for the
determination of probable cause, and "probable cause merely implies probability of guilt
and should be determined in a summary manner. A preliminary investigation is not a
part of the trial and it is only in a trial where an accused can demand the full exercise of
his rights, such as the right to confront and cross-examine his accusers to establish his
innocence." Thus, the rights of a respondent in a preliminary investigation are limited to
those granted by procedural law.
A preliminary investigation is defined as an inquiry or proceeding for the purpose of
determining whether there is sufficient ground to engender a well founded belief that a
crime cognizable by the Regional Trial Court has been committed and that the
respondent is probably guilty thereof, and should be held for trial. The quantum of
evidence now required in preliminary investigation is such evidence sufficient to
"engender a well founded belief' as to the fact of the commission of a crime and the
respondent's probable guilt thereof A preliminary investigation is not the occasion for
the full and exhaustive display of the parties' evidence; it is for the presentation of such
evidence only as may engender a well-grounded belief that an offense has been
committed and that the accused is probably guilty thereof. We are in accord with the
state prosecutor's findings in the case at bar that there exists prima facie evidence of
petitioner's involvement in the commission of the crime, it being sufficiently supported
by the evidence presented and the facts obtaining therein.
Likewise devoid of cogency is petitioner's argument that the testimonies of Galarion and
Hanopol are inadmissible as to him since he was not granted the opportunity of cross-
examination.
It is a fundamental principle that the accused in a preliminary investigation has no right
to cross-examine the witnesses which the complainant may present. Section 3, Rule
112 of the Rules of Court expressly provides that the respondent shall only have the
right to submit a counter-affidavit, to examine all other evidence submitted by the
complainant and, where the fiscal sets a hearing to propound clarificatory questions to
the parties or their witnesses, to be afforded an opportunity to be present but without
the right to examine or cross-examine. Thus, even if petitioner was not given the
opportunity to cross-examine Galarion and Hanopol at the time they were presented to
testify during the separate trial of the case against Galarion and Roxas, he cannot
assert any legal right to cross-examine them at the preliminary investigation precisely
because such right was never available to him. The admissibility or inadmissibility of
said testimonies should be ventilated before the trial court during the trial proper and
not in the preliminary investigation.
Furthermore, the technical rules on evidence are not binding on the fiscal who has
jurisdiction and control over the conduct of a preliminary investigation. If by its very
nature a preliminary investigation could be waived by the accused, we find no
compelling justification for a strict application of the evidentiary rules. In addition,
considering that under Section 8, Rule 112 of the Rules of Court, the record of the
preliminary investigation does not form part of the record of the case in the Regional
Trial Court, then the testimonies of Galarion and Hanopol may not be admitted by the
trial court if not presented in evidence by the prosecuting fiscal. And, even if the
prosecution does present such testimonies, petitioner can always object thereto and the
trial court can rule on the admissibility thereof; or the petitioner can, during the trial,
petition said court to compel the presentation of Galarion and Hanopol for purposes of
cross-examination. (Citations and emphasis omitted)
Plainly, the AMLC's investigation of money laundering offenses and its determination of
possible money laundering offenses, specifically its inquiry into certain bank accounts
allowed by court order, does not transform it into an investigative body exercising
quasi-judicial powers. Hence, Section 11 of the AMLA, authorizing a bank inquiry court
order, cannot be said to violate SPCMB's constitutional right to procedural due process.
We now come to a determination of whether Section 11 is violative of the constitutional
right to privacy enshrined in Section 2, Article III of the Constitution. SPCMB is
adamant that the CA's denial of its request to be furnished copies of AMLC's ex-
parte application for a bank inquiry order and all subsequent pleadings, documents and
orders filed and issued in relation thereto, constitutes grave abuse of discretion where
the purported blanket authority under Section 11: (1) partakes of a general warrant
intended to aid a mere fishing expedition; (2) violates the attorney-client privilege; (3)
is not preceded by predicate crime charging SPCMB of a money laundering offense; and
(4) is a form of political harassment [of SPCMB's] clientele.
We shall discuss these issues jointly since the assailed Section 11 incorporates by
reference that "[t]he authority to inquire into or examine the main and the related
accounts shall comply with the requirements of Article III, Sections 2 and 3 of the 1987
Constitution." On this point, SPCMB asseverates that "there is nothing in the AMLA that
allows or justifies the withholding of information and/or any court records or
proceedings pertaining to an examination of a bank account, especially if the court has
already granted the authority to conduct the examination."
The theme of playing off privacy rights and interest against that of the state's interest
in curbing money laundering offenses is recurring.28
The invoked constitutional provisions read:
SEC. 2. The right of the people to be secure in their persons, houses, papers, and
effects against unreasonable searches and seizures of whatever nature and for any
purpose shall be inviolable, and no search warrant or warrant of arrest shall issue
except upon probable cause to be determined personally by the judge after
examination under oath or affirmation of the complainant and the witnesses he may
produce, and particularly describing the place to be searched and the person or things
to be seized.
SEC. 3. (1) The privacy of communication and correspondence shall be inviolable
except upon lawful order of the court, or when public policy or order requires otherwise
as prescribed by law.
(2) Any evidence obtained in violation of this or the preceding section shall be
inadmissible for any purpose in any proceeding.
Once again, Eugenio29 offers guidance:
The Court's construction of Section 11 of the AMLA is undoubtedly influenced by right to
privacy considerations. If sustained, petitioner's argument that a bank account may be
inspected by the government following an ex parte proceeding about which the
depositor would know nothing would have significant implications on the right to
privacy, a right innately cherished by all notwithstanding the legally recognized
exceptions thereto. The notion that the government could be so empowered is cause for
concern of any individual who values the right to privacy which, after all, embodies
even the right to be "let alone," the most comprehensive of rights and the right most
valued by civilized people.
One might assume that the constitutional dimension of the right to privacy, as applied
to bank deposits, warrants our present inquiry. We decline to do so. Admittedly, that
question has proved controversial in American jurisprudence. Notably, the United
States Supreme Court in U.S. v. Miller held that there was no legitimate
expectation of privacy as to the bank records of a depositor. Moreover, the
text of our Constitution has not bothered with the triviality of allocating
specific rights peculiar to bank deposits.
However, sufficient for our purposes, we can assert there is a right to privacy governing
bank accounts in the Philippines, and that such right finds application to the case at
bar. The source of such right is statutory, expressed as it is in R.A. No. 1405 otherwise
known as the Bank Secrecy Act of 1955. The right to privacy is enshrined in Section 2
of that law, to wit:
SECTION 2. All deposits of whatever nature with banks or banking institutions
in the Philippines including investments in bonds issued by the Government of
the Philippines, its political subdivisions and its instrumentalities, are hereby
considered as of an absolutely confidential nature and may not be examined,
inquired or looked into by any person, government official, bureau or office, except
upon written permission of the depositor, or in cases of impeachment, or upon order of
a competent court in cases of bribery or dereliction of duty of public officials, or in cases
where the money deposited or invested is the subject matter of the litigation.
Because of the Bank Secrecy Act, the confidentiality of bank deposits remains a basic
state policy in the Philippines. Subsequent laws, including the AMLA, may have added
exceptions to the Bank Secrecy Act, yet the secrecy of bank deposits still lies as the
general rule. It falls within the zones of privacy recognized by our laws. The framers of
the 1987 Constitution likewise recognized that bank accounts are not covered by either
the right to information under Section 7, Article III or under the requirement of full
public disclosure under Section 28, Article II. Unless the Bank Secrecy Act is repealed
or amended, the legal order is obliged to conserve the absolutely confidential nature of
Philippine bank deposits.
Any exception to the rule of absolute confidentiality must be specifically legislated.
Section 2 of the Bank Secrecy Act itself prescribes exceptions whereby these bank
accounts may be examined by "any person, government official, bureau or office";
namely when: (1) upon written permission of the depositor; (2) in cases of
impeachment; (3) the examination of bank accounts is upon order of a competent court
in cases of bribery or dereliction of duty of public officials; and (4) the money deposited
or invested is the subject matter of the litigation. Section 8 of R.A. Act No. 3019, the
Anti-Graft and Corrupt Practices Act, has been recognized by this Court as constituting
an additional exception to the rule of absolute confidentiality, and there have been
other similar recognitions as well.
The AMLA also provides exceptions to the Bank Secrecy Act. Under Section 11, the
AMLC may inquire into a bank account upon order of any competent court in cases of
violation of the AMLA, it having been established that there is probable cause that the
deposits or investments are related to unlawful activities as defined in Section 3(i) of
the law, or a money laundering offense under Section 4 thereof. Further, in instances
where there is probable cause that the deposits or investments are related to
kidnapping for ransom, certain violations of the Comprehensive Dangerous Drugs Act of
2002, hijacking and other violations under R.A. No. 6235, destructive arson and
murder, then there is no need for the AMLC to obtain a court order before it could
inquire into such accounts.
It cannot be successfully argued the proceedings relating to the bank inquiry order
under Section 11 of the AMLA is a "litigation" encompassed in one of the exceptions to
the Bank Secrecy Act which is when "the money deposited or invested is the subject
matter of the litigation." The orientation of the bank inquiry order is simply to serve as
a provisional relief or remedy. As earlier stated, the application for such does not entail
a full-blown trial.
Nevertheless, just because the AMLA establishes additional exceptions to the Bank
Secrecy Act it does not mean that the later law has dispensed with the general principle
established in the older law that "[a]ll deposits of whatever nature with banks or
banking institutions in the Philippines x x x are hereby considered as of an absolutely
confidential nature." Indeed, by force of statute, all bank deposits are absolutely
confidential, and that nature is unaltered even by the legislated exceptions referred to
above. There is disfavor towards construing these exceptions in such a manner that
would authorize unlimited discretion on the part of the government or of any party
seeking to enforce those exceptions and inquire into bank deposits. If there are doubts
in upholding the absolutely confidential nature of bank deposits against affirming the
authority to inquire into such accounts, then such doubts must be resolved in favor of
the former. Such a stance would persist unless Congress passes a law reversing the
general state policy of preserving the absolutely confidential nature of Philippine bank
accounts. (Citations omitted, emphasis supplied)
From the foregoing disquisition, we extract the following principles:
1. The Constitution did not allocate specific rights peculiar to bank deposits;
2. The general rule of absolute confidentiality is simply statutory,30i.e. not specified in
the Constitution, which has been affirmed in jurisprudence;31
3. Exceptions to the general rule of absolute confidentiality have been carved out by the
Legislature which legislation have been sustained, albeit subjected to heightened
scrutiny by the courts;32 and
4. One such legislated exception is Section 11 of the AMLA.
The warning in Eugenio that an ex-parte proceeding authorizing the government to
inspect certain bank accounts or investments without notice to the depositor would
have significant implications on the right to privacy still does not preclude such a bank
inquiry order to be allowed by specific legislation as an exception to the general rule of
absolute confidentiality of bank deposits.
We thus subjected Section 11 of the AMLA to heightened scrutiny and found nothing
arbitrary in the allowance and authorization to AMLC to undertake an inquiry into
certain bank accounts or deposits. Instead, we found that it provides safeguards before
a bank inquiry order is issued, ensuring adherence to the general state policy of
preserving the absolutely confidential nature of Philippine bank accounts:
(1) The AMLC is required to establish probable cause as basis for its ex-
parte application for bank inquiry order;
(2) The CA, independent of the AMLC's demonstration of probable cause, itself makes a
finding of probable cause that the deposits or investments are related to an unlawful
activity under Section 3(i) or a money laundering offense under Section 4 of the AMLA;
(3) A bank inquiry court order ex-parte for related accounts is preceded by a bank
inquiry court order ex-parte for the principal account which court order ex-parte for
related accounts is separately based on probable cause that such related account is
materially linked to the principal account inquired into; and
(4) The authority to inquire into or examine the main or principal account and the
related accounts shall comply with the requirements of Article III, Sections 2 and 3 of
the Constitution.
The foregoing demonstrates that the inquiry and examination into the bank account are
not undertaken whimsically and solely based on the investigative discretion of the
AMLC. In particular, the requirement of demonstration by the AMLC, and determination
by the CA, of probable cause emphasizes the limits of such governmental action. We
will revert to these safeguards under Section 11 as we specifically discuss the CA's
denial of SPCMB's letter request for information concerning the purported issuance of a
bank inquiry order involving its accounts.
First.  The AMLC and the appellate court are respectively required to demonstrate and
ascertain probable cause. Ret. Lt. Gen. Ligot, et al. v. Republic of the
Philippines,33 which dealt with the adjunct provisional remedy of freeze order under
Section 10 of the AMLA, defined probable cause, thus:
The probable cause required for the issuance of a freeze order differs from the probable
cause required for the institution of a criminal action, xxx.
As defined in the law, the probable cause required for the issuance of a freeze order
refers to "such facts and circumstances which would lead a reasonably discreet, prudent
or cautious man to believe that an unlawful activity and/or money laundering offence is
about to be, is being or has been committed and that the account or any monetary
instrument or property subject thereof sought to be frozen is in any way
related to said unlawful activity and/or money laundering offense."
In other words, in resolving the issue of whether probable cause exits, the CA's
statutorily-guided determination's focus is not on the probable commissions of an
unlawful activity (or money laundering) that the office of the Ombudsman has already
determined to exist, but on whether the bank accounts, assets, or other monetary
instruments sought to be frozen are in any way related to any of the illegal activities
enumerated under R.A. 9160, as amended. Otherwise stated, probable cause refers to
the sufficiency of the relation between an unlawful activity and the property or
monetary instrument which is the focal point of Section 10 of RA No. 9160, as
amended. xxx. (Emphasis supplied)
Second.  As regards SPCMB's contention that the bank inquiry order is in the nature of a
general warrant, Eugenio already declared that Section 11, even with the allowance of
an ex parte application therefor, "is not a search warrant or warrant of arrest as it
contemplates a direct object but not the seizure of persons or property."34 It bears
repeating that the ''bank inquiry order" under Section 11 is a provisional remedy to aid
the AMLC in the enforcement of the AMLA.
Third. Contrary to the stance of SPCMB, the bank inquiry order does not contemplate
that SPCMB be first impleaded in a money laundering case already filed before the
courts:
We are unconvinced by this proposition, and agree instead with the then Solicitor
General who conceded that the use of the phrase "in cases of' was unfortunate, yet
submitted that it should be interpreted to mean "in the event there are violations" of
the AMLA, and not that there are already cases pending in court concerning such
violations. If the contrary position is adopted, then the bank inquiry order would be
limited in purpose as a tool in aid of litigation of live cases, and wholly inutile as a
means for the government to ascertain whether there is sufficient evidence to sustain
an intended prosecution of the account holder for violation of the AMLA. Should that be
the situation, in all likelihood the AMLC would be virtually deprived of its character as a
discovery tool, and thus would become less circumspect in filing complaints against
suspect account holders. After all, under such set-up the preferred strategy would be to
allow or even encourage the indiscriminate filing of complaints under the AMLA with the
hope or expectation that the evidence of money laundering would somehow .surface
during the trial. Since the AMLC could not make use of the bank inquiry order to
determine whether there is evidentiary basis to prosecute the suspected malefactors,
not filing any case at all would not be an alternative. Such unwholesome set-up should
not come to pass. Thus Section 11 cannot be interpreted in a way that would
emasculate the remedy it has established and encourage the unfounded initiation of
complaints for money laundering.35 (Citation omitted)
Guided as we are by prior holdings, and bound as we are by the requirements for
issuance of a bank inquiry order under Section 11 of the AMLA, we are hard pressed to
declare that it violates SPCMB's right to privacy.
Nonetheless, although the bank inquiry order ex-parte passes constitutional muster,
there is nothing in Section 11 nor the implementing rules and regulations of the AMLA
which prohibits the owner of the bank account, as in his instance SPCMB, to ascertain
from the CA, post issuance of the bank inquiry order ex-parte, if his account is indeed
the subject of an examination. Emphasized by our discussion of the safeguards under
Section 11 preceding the issuance of such an order, we find that there is nothing
therein which precludes the owner of the account from challenging the basis for the
issuance thereof.
The present controversy revolves around the issue of whether or not the appellate
court, through the Presiding Justice, gravely abused its discretion when it effectively
denied SPCMB's letter-request for confirmation that the AMLC had applied (ex-parte)
for, and was granted, a bank inquiry order to examine SPCMB's bank accounts relative
to the investigation conducted on Vice-President Binay's accounts.
We recall the Presiding Justice's letter to SPCMB categorically stating that "under the
rules, the Office of the Presiding Justice is strictly mandated not to disclose, divulge, or
communicate to anyone directly or indirectly, in any manner or by any means, the fact
of the filing of the petition brought before [the Court of Appeals] by the [AMLC], its
contents and even its entry in the logbook." Note that the letter did not cite the
aforementioned rules that were supposedly crystal clear to foreclose ambiguity. Note
further that Rules 10.c.3 and 10.d of the IRR on Authority to File Petitions for Freeze
Order provides that:
Rule 10.c. Duty of Covered Institutions upon receipt thereof. —
Rule 10.c.1. Upon receipt of the notice of the freeze order, the covered institution
concerned shall immediately freeze the monetary instrument or property and related
accounts subject thereof.
Rule 10.c.2. The covered institution shall likewise immediately furnish a copy of the
notice of the freeze order upon the owner or holder of the monetary instrument or
property or related accounts subject thereof.
Rule 10.c.3. Within twenty-four (24) hours from receipt of the freeze order, the
covered institution concerned shall submit to the Court of Appeals and the AMLC, by
personal delivery, a detailed written return on the freeze order, specifying all the
pertinent and relevant information which shall include the following:
(a) the account numbers;
(b) the names of the account owners or holders;
(c) the amount of the monetary instrument, property or related accounts as of the time
they were frozen;
(d) all relevant information as to the nature of the monetary instrument or property;
(e) any information on the related accounts pertaining to the monetary instrument or
property subject of the freeze order; and
(f) the time when the freeze thereon took effect.
Rule 10.d. Upon receipt of the freeze order issued by the Court of Appeals and upon
verification by the covered institution that the related accounts originated from and/or
are materially linked to the monetary instrument or property subject of the freeze
order, the covered institution shall freeze these related accounts wherever these may
be found.
The return of the covered institution as required under Rule 10.c.3 shall include the fact
of such freezing and an explanation as to the grounds for the identification of the
related accounts.
If the related accounts cannot be determined within twenty-four (24) hours from
receipt of the freeze order due to the volume and/or complexity of the transactions or
any other justifiable factor(s), the covered institution shall effect the freezing of the
related accounts, monetary instruments and properties as soon as practicable and shall
submit a supplemental return thereof to the Court of Appeals and the AMLC within
twenty-four (24) hours from the freezing of said related accounts, monetary
instruments and properties.
The foregoing rule, in relation to what Section 11 already provides, signifies that ex-
parte bank inquiry orders on related accounts may be questioned alongside, albeit
subsequent to, the issuance of the initial freeze order of the subject bank accounts. The
requirements and procedure for the issuance of the order, including the return to be
made thereon lay the grounds for judicial review thereof. We expound.
An act of a court or tribunal can only be considered tainted with grave abuse of
discretion when such act is done in a capricious or whimsical exercise of judgment as is
equivalent to lack of jurisdiction. It is well-settled that the abuse of discretion to be
qualified as "grave" must be so patent or gross as to constitute an evasion of a positive
duty or a virtual refusal to perform the duty or to act at all in contemplation of law.36 In
this relation, case law states that not every error in the proceedings, or every
erroneous conclusion of law or fact, constitutes grave abuse of discretion.37 The degree
of gravity, as above-described, must be met.
That the propriety of the issuance of the bank inquiry order is a justiciable issue brooks
no argument. A justiciable controversy refers to an existing case or controversy that is
appropriate or ripe for judicial determination, not one that is conjectural or merely
anticipatory.38
As previously adverted to in our discussion on the right to privacy, the clash of privacy
rights and interest against that of the government's is readily apparent. However, the
statutorily enshrined general rule on absolute confidentiality of bank accounts remains.
Thus, the safeguards instituted in Section II of the AMLA and heretofore discussed
provide for certain well defined limits, as in the language of Baker v. Carr, "judicially
discoverable standards" for determining the validity of the exercise of such discretion
by the appellate court in denying the letter-request of SPCMB.39 In short, Section II
itself provides the basis for the judicial inquiry and which the owner of the bank
accounts subject of the AMLC inquiry may invoke.
Undeniably, there is probable and preliminary governmental action against SPCMB
geared towards implementation of the AMLA directed at SPCMB's property, although
there is none, as yet, physical seizure thereof, as in freezing of bank accounts under
Section 10 of the AMLA.40 Note, however, that the allowance to question the bank
inquiry order we carve herein is tied to the appellate court's issuance of a freeze order
on the principal accounts. Even in Eugenio, while declaring that the bank inquiry order
under Section II then required prior notice of such to the account owner, we recognized
that the determination of probable cause by the appellate court to issue the bank
inquiry order can be contested. As presently worded and how AMLC functions are
designed under the AMLA, the occasion for the issuance of the freeze order upon the
actual physical seizure of the investigated and inquired into bank account, calls into
motions the opportunity for the bank account owner to then question, not just probable
cause for the issuance of the freeze order under Section I 0, but, to begin with, the
determination of probable cause for an ex-parte bank inquiry order into a purported
related account under Section II.
In enacting the amendment to Section II of the AMLC, the legislature saw it fit to place
requirements before a bank inquiry order may be issued. We discussed these
requirements as basis for a valid exception to the general rule on absolute
confidentiality of bank accounts. However, these very safe guards allow SPCMB, post
issuance of the ex-parte bank inquiry order, legal bases to question the propriety of
such issued order, if any. To emphasize, this allowance to the owner of the bank
account to question the bank inquiry order is granted only after issuance of the freeze
order physically seizing the subject bank account. It cannot be undertaken prior to the
issuance of the freeze order.
While no grave abuse of discretion could be ascribed on the part of the appellate court
when it explained in its letter that petitions of such nature "is strictly confidential in
that when processing the same, not even the handling staff members of the Office of
the Presiding Justice know or have any knowledge who the subject bank account
holders are, as well as the bank accounts involved," it was incorrect when it declared
that "under the rules, the Office of the Presiding Justice is strictly mandated not to
disclose, divulge, or communicate to anyone directly or indirectly, in any manner or by
any means, the fact of the filing of any petition brought before [the Court of Appeals]
by the Anti-Money Laundering Council, its contents and even its entry in the logbook."
As a result, the appellate court effectively precluded and prevented SPCMB of any
recourse, amounting to a denial of SPCMB's letter request.
We cannot overemphasize that SPCMB, as the owner of the bank account which may be
the subject of inquiry of the AMLC, ought to have a legal remedy to question the
validity and propriety of such an order by the appellate court under Section 11 of the
AMLA even if subsequent to the issuance of a freeze order. Moreover, given the scope
of inquiry of the AMLC, reaching and including even related accounts, which inquiry into
specifies a proviso that: "[t]hat the procedure for the ex-parte application of the ex-
parte court order for the principal account shall be the same with that of the related
accounts," SPCMB should be allowed to question the government intrusion. Plainly, by
implication, SPCMB can demonstrate the absence of probable cause, i.e. that it is not a
related account nor are its accounts materially linked to the principal account being
investigated.41
In BSB Group, Inc. v. Go,42 we recounted the objective of the absolute confidentiality
rule which is protection from unwarranted inquiry or investigation if the purpose of such
inquiry or investigation is merely to determine the existence and nature, as well as the
amount of the deposit in any given bank account:
xxx. There is, in fact, much disfavor to construing these primary and supplemental
exceptions in a manner that would authorize unbridled discretion, whether
governmental or otherwise, in utilizing these exceptions as authority for unwarranted
inquiry into bank accounts. It is then perceivable that the present legal order is obliged
to conserve the absolutely confidential nature of bank deposits.
The measure of protection afforded by the law has been explained in  China Banking
Corporation v. Ortega. That case principally addressed the issue of whether the
prohibition against an examination of bank deposits precludes garnishment in
satisfaction of a judgment. Ruling on that issue in the negative, the Court found
guidance in the relevant portions of the legislative deliberations on Senate Bill No. 351
and House Bill No. 3977, which later became the Bank Secrecy Act, and it held that the
absolute confidentiality rule in R.A. No. 1405 actually aims at protection from
unwarranted inquiry or investigation if the purpose of such inquiry or investigation is
merely to determine the existence and nature, as well as the amount of the deposit in
any given bank account. Thus,
x x x The lower court did not order an examination of or inquiry into the deposit of B&B
Forest Development Corporation, as contemplated in the law. It merely required Tan
Kim Liong to inform the court whether or not the defendant B&B Forest Development
Corporation had a deposit in the China Banking Corporation only for purposes of the
garnishment issued by it, so that the bank would hold the same intact and not allow
any withdrawal until further order. It will be noted from the discussion of the
conference committee report on Senate Bill No. 351 and House Bill No. 3977 which
later became Republic Act No. 1405, that it was not the intention of the lawmakers to
place banks deposits beyond the reach of execution to satisfy a final judgment Thus:
x x x Mr. Marcos: Now, for purposes of the record, I should like the Chairman of the
Committee on Ways and Means to clarify this further. Suppose an individual has a tax
case. He is being held liable by the Bureau of Internal Revenue [(BIR)] or, say,
P1,000.00 worth of tax liability, and because of this the deposit of this individual [has
been] attached by the [BIR].
Mr. Ramos: The attachment will only apply after the court has pronounced sentence
declaring the liability of such person. But where the primary aim is to determine
whether he has a bank deposit in order to bring about a proper assessment by the
[BIR], such inquiry is not allowed by this proposed law.
Mr. Marcos: But under our rules of procedure and under the Civil Code, the attachment
or garnishment of money deposited is allowed. Let us assume for instance that there is
a preliminary attachment which is for garnishment or for holding liable all moneys
deposited belonging to a certain individual, but such attachment or garnishment will
bring out into the open the value of such deposit. Is that prohibited by... the law?
Mr. Ramos: It is only prohibited to the extent that the inquiry... is made only for the
purpose of satisfying a tax liability already declared for the protection of the right in
favor of the government; but when the object is merely to inquire whether he has a
deposit or not for purposes of taxation, then this is fully covered by the law. x x x
Mr. Marcos: The law prohibits a mere investigation into the existence and the amount
of the deposit.
Mr. Ramos: Into the very nature of such deposit. x x x (Citations omitted)
What is reflected by the foregoing disquisition is that the law plainly prohibits a mere
investigation into the existence and the amount of the deposit. We relate the principle
to SPCMB's relationship to the reported principal account under investigation, one of its
clients, former Vice President Binay. SPCMB as the owner of one of the bank accounts
reported to be investigated by the AMLC for probable money laundering offenses should
be allowed to pursue remedies therefrom where there are legal implications on the
inquiry into its accounts as a law firm. While we do not lapse into conjecture and cannot
take up the lance for SPCMB on probable violation of the attorney-client privilege based
on pure speculation, the extent of information obtained by the AMLC concerning the
clients of SPCMB has not been fully drawn and sufficiently demonstrated. At the same
time, the owner of bank accounts that could be potentially affected has the right to
challenge whether the requirements for issuance of the bank inquiry order were indeed
complied with given that such has implications on its property rights. In this regard,
SPCMB's obeisance to promulgated rules on the matter could have afforded it a
remedy, even post issuance of the bank inquiry order.
Rule 10.b. of the IRR defines probable cause as "such facts and circumstances which
would lead a reasonably discreet, prudent or cautious man to believe that an unlawful
activity and/or a money laundering offense is about to be, is being or has been
committed and that the account or any monetary instrument or property sought to be
frozen is in any way related to said unlawful activity and/or money laundering offense."
Evidently, the provision only refers to probable cause for freeze orders under Section 10
of the AMLA. From this we note that there is a glaring  lacunae in our procedural rules
concerning the bank inquiry order under Section 11. Despite the advent of RA No.
10167, amending Section 11 of the AMLA, we have yet to draft additional rules
corresponding to the ex-parte bank inquiry order under Section 11. A.M. No. 05-11-04-
SC entitled "Rule of Procedure in Cases of Civil Forfeiture, Asset Preservation, and
Freezing of Monetary Instrument, Property, or Proceeds Representing, Involving, or
Relating to an Unlawful Activity or Money Laundering Offense Under Republic Act No.
9160, as Amended," only covers what is already provided in the title. As we have
already noted, the bank inquiry order must likewise be governed by rules specific to its
issuance where the AMLC regularly invokes this provision and which, expectedly clashes
with the rights of bank account holders.
Apart from Section 2, Rule IV of the 2009 Internal Rules of the CA (IRCA) reads:
SEC. 2. Action by the Presiding Justice or Executive Justice. — When a petition
involves an urgent matter, such as an application for writ of  habeas corpus, amparo
or habeas data or for temporary restraining order, and there is no way of convening
the Raffle Committee or calling any of its members, the Presiding Justice or the
Executive Justice, as the case may be, or in his/her absence, the most senior Justice
present, may conduct the raffle or act on the petition, subject to raffle in the latter case
on the next working day in accordance with Rule III hereof.
(AMLA cases are limited to the first three most senior Justices as stated in the
law and are raffled by the Chairmen of the First, Second and Third Divisions to
the members of their Divisions only.)
Nothing in the IRCA justifies the disallowance to SPCMB of information and/or court
records or proceedings pertaining to the possible bank inquiry order covering its bank
deposits or investment.
We note that the Presiding Justice's reply to the request for comment of SPCMB on the
existence of a petition for bank inquiry order by the AMLC covering the latter's account
only contemplates the provisions of Section 10 of the AMLA, its IRR and the
promulgated rules thereon. Such immediate and definitive foreclosure left SPCMB with
no recourse on how to proceed from what it perceived to be violation of its rights as
owner of the bank account examined. The reply of the Presiding Justice failed to take
into consideration Section 54 of A.M. No. 05-11-04-SC on Notice of Freeze Order which
reads:
SEC. 54. Notice of freeze order.- The Court shall order that notice of the freeze order be
served personally, in the same manner provided for the service of the asset
preservation order in Section 14 of this Rule, upon the respondent or any person acting
in his behalf and such covered institution or government agency. The court shall
notify also such party in interest as may have appeared before the
court. (Emphasis supplied)
We relate this Section 54 to the already cited Rule 10.d of the IRR
Rule 10.d. Upon receipt of the freeze order issued by the Court of Appeals and upon
verification by the covered institution that the related accounts originated from and/or
are materially linked to the monetary instrument or property subject of the freeze
order, the covered institution shall freeze these related accounts wherever these may
be found.
The return of the covered institution as required under Rule 10.c.3 shall
include the fact of such freezing and an explanation as to the grounds for the
identification of the related accounts.
If the related accounts cannot be determined within twenty-four (24) hours
from receipt of the freeze order due to the volume and/or complexity of the
transactions or any other justifiable factor(s), the covered institution shall
effect the freezing of the related accounts, monetary instruments and
properties as soon as practicable and shall submit a supplemental return
thereof to the Court of Appeals and the AMLC within twenty-four (24) hours
from the freezing of said related accounts, monetary instruments and
properties. (Emphasis supplied)
demonstrating that the return of the Freeze Order must provide an explanation as to
the grounds for the identification of the related accounts, or the requirement of notice
to a party in interest affected thereby whose bank accounts were examined. This
necessarily contemplates the procedure for a prior bank inquiry order which we ought
to provide for.
For exact reference, we cite A.M. No. 05-11-04-SC, Title VIII on Petitions for Freeze
Order in the CA which certain pertinent provisions we adopt and apply suppletorily as a
separate Title on Petitions for Bank Inquiry Order:
TITLE VIII
PETITIONS FOR FREEZE ORDER IN THE COURT OF APPEALS
SEC. 43. Applicability. - This Rule shall apply to petitions for freeze order in the Court of
Appeals. The 2002 Internal Rules of the Court of Appeals, as amended, shall apply
suppletorily in all other aspects.
xxxx
SEC. 46. Contents of the petition. - The petition shall contain the following allegations:
(a) The name and address of the respondent;
(b) A specific description with particularity of the monetary instrument, property or proceeds,
their location, the name of the owner, holder, lienholder or possessor, if known;
(c) The grounds relied upon for the issuance of a freeze order; and
(d) The supporting evidence showing that the subject monetary instrument, property, or
proceeds are in any way related to or involved in an unlawful activity as defined under
 Section 3(i) of Republic Act No. 9160, as amended by Republic Act No. 9194.
The petition shall be filed in seven clearly legible copies and shall be accompanied by
clearly legible copies of supporting documents duly subscribed under oath.
xxxx
SEC. 49. Confidentiality; prohibited disclosure. - The logbook and the entries therein
shall be kept strictly confidential and maintained under the responsibility of the
Presiding Justice or the Executive Justices, as the case may be. 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 the filing of the petition for freeze order, its
contents and its entry in the logbook except to those authorized by the Court. Violation
shall constitute contempt of court.
xxxx
SEC. 51. Action by the Court of Appeals.- All members of the Division of the Court to
which the assigned justice belongs shall act on the petition within twenty-four hours
after its filing. However, if one member of the Division is not available, the assigned
justice and the other justice present shall act on the petition. If only the assigned
justice is present, he shall act alone. The action of the two justices or of the assigned
justice alone, as the case may be, shall be forthwith promulgated and thereafter
submitted on the next working day to the absent member or members of the Division
for ratification, modification or recall.
If the Court is satisfied from the verified allegations of the petition that there exists
probable cause that the monetary instrument, property, or proceeds are in any way
related to or involved in any unlawful activity as defined in Section 3(i) of Republic Act
No. 9160, as amended by Republic Act No. 9194, it shall issue ex parte a freeze order
as hereinafter provided.
If the Court finds no substantial merit in the petition, it shall dismiss the petition
outright, stating the specific reasons for such dismissal.
When the unanimous vote of the three justices of the Division cannot be obtained, the
Presiding Justice or the Executive Justice shall designate two justices by raffle from
among the other justices of the first three divisions to sit temporarily with them forming
a special division of five justices. The concurrence of a majority of such special division
shall be required for the pronouncement of a judgment or resolution.
SEC. 52. Issuance, form and contents of the freeze order - The freeze order shall:
(a) issue in the name of the Republic of the Philippines represented by the Anti-Money
Laundering Council;
(b) describe with particularity the monetary instrument, property or proceeds frozen, as well
as the names of their owner or owners; and
(c) direct the person or covered institution to immediately freeze the subject monetary
instrument, property or proceeds or its related web of accounts.
SEC. 53. Freeze order.
(a) Effectivity; post issuance hearing. - The freeze order shall be effective immediately for a
period of twenty days. Within the twenty-day period, the court shall conduct a summary
hearing, with notice to the parties, to determine whether or not to modify or lift the freeze
order, or extend its effectivity as hereinafter provided.
 (b) Extension. - On motion of the petitioner filed before the expiration of twenty days from
issuance of a freeze order, the court may for good cause extend its effectivity for a period
not exceeding six months.
SEC. 54. Notice of freeze order.- The Court shall order that notice of the freeze order be
served personally, in the same manner provided for the service of the asset
preservation order in Section 14 of this Rule, upon the respondent or any person acting
in his behalf and such covered institution or government agency. The court shall notify
also such party in interest as may have appeared before the court.
SEC. 55. Duty of respondent, covered institution or government agency upon receipt of
freeze order. - Upon receipt of a copy of the freeze order, the respondent, covered
institution or government agency shall immediately desist from and not allow any
transaction, withdrawal, deposit, transfer, removal, conversion, other movement or
concealment the account representing, involving or relating to the subject monetary
instrument, property, proceeds or its related web of accounts.
SEC. 56. Consolidation with the pending civil forfeiture proceedings - After the post-
issuance hearing required in Section 53, the Court shall forthwith remand the case and
transmit the records to the regional trial court for consolidation with the pending civil
forfeiture proceeding.
SEC. 57. Appeal.- Any party aggrieved by the decision or ruling of the court may appeal
to the Supreme Court by petition for review on certiorari under Rule 45 of the Rules of
Court. The appeal shall not stay the enforcement of the subject decision or final order
unless the Supreme Court directs otherwise.
A reverse situation affords us a clearer picture of the arbitrary and total preclusion of
SPCMB to question the bank inquiry order of the appellate court. In particular, in an
occasion where the appellate court denies the AMLC's ex-parte application for a bank
inquiry order under Section 11, the AMLC can question this denial and assail such an
order by the appellate court before us on grave abuse of discretion. Among others, the
AMLC can demonstrate that it has established probable cause for its issuance, or if the
situation contemplates a denial of an application for a bank inquiry order into a related
account, the AMLC can establish that the account targeted is indeed a related account.
The resolution on these factual and legal issues ought to be reviewable, albeit post
issuance of the Freeze Order, akin to the provision of an Appeal to the Supreme Court
under Section 57 of A.M. No. 05-11-04-SC.
Palpably, the requirement to establish probable cause is not a useless supposition. To
establish and demonstrate the required probable cause before issuance of the bank
inquiry and the freeze orders is a screw on which the AMLC's intrusive functions turns.
We are hard pressed to justify a disallowance to an aggrieved owner of a bank account
to avail of remedies.
That there are no specific rules governing the bank inquiry order does not signify that
the CA cannot confirm to the actual owner of the bank account reportedly being
investigated whether it had in fact issued a bank inquiry order for covering its accounts,
of course after the issuance of the Freeze Order. Even in Ligot,43 we held that by
implication, where the law did not specify, the owner of the "frozen" property may
move to lift the freeze order issued under Section 10 of the AMLA if he can show that
no probable cause exists or the 20-day period of the freeze order has already lapsed
without any extension being requested from and granted by the CA. Drawing a parallel,
such a showing of the absence of probable cause ought to be afforded SPCMB.
Ligot clarifies that "probable cause refers to the sufficiency of the relation between an
unlawful activity and the property or monetary instrument which is the focal point of
Section 10 of the AMLA, as amended." This same probable cause is likewise the focal
point in a bank inquiry order to further determine whether the account under
investigation is linked to unlawful activities and/or money laundering offense. Thus, the
specific applicability of Sections 52, 53, 54 and 57 Title VIII of A.M. No. 05-11-04-SC
covering the following: (1) Issuance, Form and Content of the Freeze Order; (2)
Effectivity of the Freeze Order and Post Issuance Hearing thereon; (3) Notice of the
Freeze Order; and (4) Appeal from the Freeze Order as separate Rules for Petitions to
Question the Bank Inquiry Order. And as held in Eugenio which now applies to the
present Section 11 of the AMLA:
Although oriented towards different purposes, the freeze order under Section 10 and
the bank inquiry order under Section 11 are similar in that they are extraordinary
provisional reliefs which the AMLC may avail of to effectively combat and prosecute
money laundering offenses. Crucially, Section 10 uses specific language to authorize
an ex parte application for the provisional relief therein, a circumstance absent in
Section 11. xxx.44
The cited rules cover and approximate the distinction made by Eugenio in declaring that
the bank inquiry order is not a search warrant, and yet there are instituted
requirements for the issuance of these orders given that such is now allowed ex-parte:
The Constitution and the Rules of Court prescribe particular requirements attaching to
search warrants that are not imposed by the AMLA with respect to bank inquiry orders.
A constitutional warrant requires that the judge personally examine under oath or
affirmation the complainant and the witnesses he may produce, such examination being
in the form of searching questions and answers. Those are impositions which the
legislative did not specifically prescribe as to the bank inquiry order under the AMLA
and we cannot find sufficient legal basis to apply them to Section 11 of the AMLA.
Simply put, a bank inquiry order is not a search warrant or warrant of arrest as it
contemplates a direct object but not the seizure of persons or property.
Even as the Constitution and the Rules of Court impose a high procedural standard for
the determination of probable cause for the issuance of search warrants which Congress
chose not to prescribe for the bank inquiry order under the AMLA, Congress
nonetheless disallowed ex parte applications for the inquiry order. We can discern that
in exchange for these procedural standards normally applied to search warrants,
Congress chose instead to legislate a right to notice and a right to be heard —
characteristics of judicial proceedings which are not ex parte. Absent any demonstrable
constitutional infirmity, there is no reason for us to dispute such legislative policy
choices.45
Thus, as an ex-parte bank inquiry order which Congress has now specifically allowed,
the owner of a bank account post issuance of the freeze order has an opportunity under
the Rules to contest the establishment of probable cause.
Again, we cannot avoid the requirement-limitation nexus in Section 11. As it affords the
government authority to pursue a legitimate state interest to investigate money
laundering offenses, such likewise provides the limits for the authority given. Moreover,
allowance to the owner of the bank account, post issuance of the bank inquiry order
and the corresponding freeze order, of remedies to question the order, will not forestall
and waylay the government's pursuit of money launderers. That the bank inquiry order
is a separate from the freeze order does not denote that it cannot be questioned. The
opportunity is still rife for the owner of a bank account to question the basis for its very
inclusion into the investigation and the corresponding freezing of its account in the
process.
As noted in Eugenio, such an allowance accorded the account holder who wants to
contest the issuance of the order and the actual investigation by the AMLC, does not
cast an unreasonable burden since the bank inquiry order has already been issued.
Further, allowing for notice to the account holder should not, in any way, compromise
the integrity of the bank records subject of the inquiry which remain in the possession
and control of the bank. The account holder so notified remains unable to do anything
to conceal or cleanse his bank account records of suspicious or anomalous transactions,
at least not without the whole hearted cooperation of the bank, which inherently has no
vested interest to aid the account holder in such manner. Rule 10.c.46 of the IRR
provides for Duty of the Covered Institution receiving the Freeze Order. Such can
likewise be made applicable to covered institutions notified of a bank inquiry order.
On the other hand, a scenario where SPCMB or any account holder under examination
later shows that the bank inquiry order was without the required probable cause, the
information obtained through the account reverts to, and maintains, its confidentiality.
In short, any and all information obtained therein by the AMLC remains confidential, as
if no examination or inquiry on the bank account or investments was undertaken. The
foregoing consequence can be added as a Section in the Rules entitled "Effect of
absence of probable cause."
All told, we affirm the constitutionality of Section 11 of the AMLA allowing the ex-
parte application by the AMLC for authority to inquire into, and examine, certain bank
deposits and investments.
Section 11 of the AMLA providing for the ex-parte bank deposit inquiry is
constitutionally firm for the reasons already discussed. The  ex-parte inquiry shall be
upon probable cause that the deposits or investments are related to an unlawful activity
as defined in Section 3(i) of the law or a money laundering offense under Section 4 of
the same law. To effect the limit on the ex-parte inquiry, the petition under oath for
authority to inquire, must, akin to the requirement of a petition for freeze order
enumerated in Title VIII of A.M. No. 05-11-04-SC, contain the name and address of the
respondent; the grounds relied upon for the issuance of the order of inquiry; and the
supporting evidence that the subject bank deposit are in any way related to or involved
in an unlawful activity.
If the CA finds no substantial merit in the petition, it shall dismiss the petition outright
stating the specific reasons for such denial. If found meritorious and there is a
subsequent petition for freeze order, the proceedings shall be governed by the existing
Rules on Petitions for Freeze Order in the CA. From the issuance of a freeze order, the
party aggrieved by the ruling of the court may appeal to the Supreme Court by petition
for review on certiorari under Rule 45 of the Rules of Court raising all pertinent
questions of law and issues, including the propriety of the issuance of a bank inquiry
order. The appeal shall not stay the enforcement of the subject decision or final order
unless the Supreme Court directs otherwise. The CA is directed to draft rules based on
the foregoing discussions to complement the existing A.M. No. 05-11-04-SC Rule of
Procedure in Cases of  Civil Forfeiture, Asset Preservation, and Freezing of Monetary
Instrument, Property, or Proceeds Representing, Involving, or Relating to an Unlawful
Activity or Money Laundering Offense under Republic Act No. 9160, as Amended for
submission to the Committee on the Revision of the Rules of Court and eventual
approval and promulgation of the Court en banc.
WHEREFORE, the petition is DENIED. Section 11 of Republic Act No. 9160, as
amended, is declared VALID and CONSTITUTIONAL.
SO ORDERED.
Sereno, C.J., Carpio, Velasco, Jr., Leonardo-De Castro, Brion, Bersamin, Del Castillo,
Mendoza, Reyes, Perlas-Bernabe, and  Jardeleza, JJ., concur.
Peralta, J., no part.
Leonen, J., see separate concurring opinion.
Caguioa, J., on leave.
Endnotes:

*
 (On Leave).
1
Rollo, pp. 3-46.
2
 Fact-finding as preliminary investigation based on administrative supervision and
powers to investigate government officials, Section 5, Article XI of the Constitution,
Ombudsman Act of 1990.
3
 In aid of legislation under Section 21, Article VI of the Constitution.
4
Rollo, p. 10
5
 Id. at 60.
6
 Id. at 51.
7
 Id. at 11.
8
 Id. at 12-13.
9
Dumlao v. Commission on Elections, 184 Phil. 369, 376-377 (1980).
10
 Republic Act No. 9160 as amended by RA 10167.
11
 CONSTITUTION, Article III, Sec. 1.
12
Perez, et al. v. Philippine Telegraph and Telephone Co., et al., 602 Phil. 522, 545
(2009).
13
 569 Phil. 98, 120-124 (2008).
14
Republic of the Phils. v. Glasgow Credit and Collection Services, Inc., et al. 566 Phil.
94, 106-107 (2008).
15
 Supra note 13 at 124-125.
16
 Supra note 11 & 12.
17
 Supra note 13 at 126.
18
 379 Phil. 165 (2000).
19
 Id. at 196-198.
20
 G. R. No. 193964, December 2, 2015.
21
 Rule 6.b. When the AMLC finds, after investigation, that there is probable cause to
charge any person with a money laundering offense under Section 4 of the AMLA, as
amended, it shall cause a complaint to be filed, pursuant to Section 7 (4) of the AMLA,
as amended, before the Department of Justice or the Office of the Ombudsman, which
shall then conduct the preliminary investigation of the case.
22
 Rule 6.c If after due notice and hearing in the preliminary investigation proceedings,
the Department of Justice, or the Office of the Ombudsman, as the case may be, finds
probable cause for a money laundering offense, it shall file the necessary information
before the Regional Trial Courts or the Sadiganbayan.
23
 Rule 5.a. Jurisdiction of Money Laundering Cases. The Regional Trial Courts shall
have the jurisdiction to try all cases on money laundering. Those committed by public
officers and private persons who are in conspiracy with such public officers shall be
under the jurisdiction of the Sandiganbayan.
23-a
 100 Phil. 1098 (1957).
24
 Supra note 18 at 198-200.
25
 G.R. No. 182573, April 23, 2014, 723 SCRA 512, 522-523.
26
 Rule 5.b. Investigation of Money Laundering Offenses.- The AMLC shall investigate:
(1) suspicious transactions;
(2) covered transactions deemed suspicious after an investigation conducted by the
AMLC;
(3) money laundering activities; and
(4) other violations of the AMLA, as amended.
27
 G.R. No. 212140-41, January-21, 2015.
28
 Recommended Citation, Robert S. Pasley, Privacy Rights v. Anti-Money Laundering
Enforcement, I 6 N.C. Banking Inst. 147 (2002).
29
 Supra note 13 at 127-132.
30
 Bank Secrecy Act (BSA) of 1955, RA No. 1405.
31
BSB Group, Inc. v. Go, 626 Phil. 501 (2010).
32
 Supra note 30 at 513; Sec. 2 of the BSA.
33
 705 Phil. 477, 501-502 (2013).
34
 Supra note 13 at 127.
35
 Id. at 120.
36
Republic of the Philippines v. Roque, 718 Phil. 294, 303 (2013).
37
Villanueva v. Mayor Ople, 512 Phil. 187 (2005).
38
Velarde v. Social Justice Society, 472 Phil. 285, 302 (2004)
39
 369 U.S. 186 (1962), cited in Francisco, Jr. v. The House of Representatives, 460
Phil. 830, 890- 891 (2003).
40
See note 13 at 124-125.
41
 Implementing Rules and Regulations of RA 9160 as amended by RA 9194 and RA
10167;
Rule 3.e.3. "Related Accounts" are those accounts, the funds and sources of which
originated from and/or are materially linked to the monetary instruments or properties
subject of the freeze order.
Rule 3.e.3.a. Materially linked accounts include but are not limited to the following:
(1) All accounts or monetary instruments belonging to the same person whose accounts,
monetary instruments or properties are the subject of the freeze order;
(2) All accounts or monetary instruments held, owned or controlled by the owner or holder of
the accounts, monetary instruments or properties subject of the freeze order, whether such
accounts are held, owned or controlled singly or jointly with another person;
(3) All accounts or monetary instruments the funds of which are transferred to the accounts,
monetary instruments or properties subject of the freeze order without any legal or trade
obligation, purpose or economic justification;
 (4) All "In Trust For" (lTF) accounts where the person whose accounts, monetary instruments
or properties are the subject of the freeze order is either the trustee or the trustor;
(5) All accounts held for the benefit or in the interest of the person whose accounts, monetary
instruments or properties are the subject of the freeze order;
(6) All accounts or monetary instruments under the name of the immediate family or
household members of the person whose accounts, monetary instruments or properties are
the subject of the freeze order if the amount or value involved is not commensurate with
the business or financial capacity of the said family or household member;
(7) All accounts of corporate and juridical entities that are substantially owned, controlled or
effectively controlled by the person whose accounts, monetary instruments or properties
are subject of the freeze order;
(8) All shares or units in any investment accounts and/or pooled funds of the person whose
accounts, monetary instruments or properties are subject of the freeze order; and
(9) All other accounts, shares, units or monetary instruments that are similar, analogous or
identical to any of the foregoing.
42
 Supra note 31 at 514-515.
43
 Supra note 33 at 483.
44
 Supra note 13 at 122.
45
 Id. at 127.
46
Rule 10.c. Duty of Covered Institutions upon receipt thereof. -
Rule 10.c.1. Upon receipt of the notice of the freeze order, the covered institution
concerned shall immediately freeze the monetary instrument or property and related
accounts subject thereof.
Rule 10.c.2. The covered institution shall likewise immediately furnish a copy of the
notice of the freeze order upon the owner or holder of the monetary instrument or
property or related accounts subject thereof.
Rule 10.c.3. Within twenty-four (24) hours from receipt of the freeze order, the
covered institution concerned shall submit to the Court of Appeals and the AMLC, by
personal delivery, a detailed written return on the freeze order, specifying all the
pertinent and relevant information which shall include the following:
(a) the account numbers;
(b) the names of the account owners or holders;
(c) the amount of the monetary instrument, property or related accounts as of the time they
were frozen;
(d) all relevant information as to the nature of the monetary instrument or property;
(e) any information on the related accounts pertaining to the monetary instrument or property
subject of the freeze order; and
(f) the time when the freeze thereon took effect.

 
CONCURRING OPINION
 LEONEN, J.:
I concur in the result. It is my honor to do so considering that the majority opinion is
the final ponencia for this Court En Banc of our esteemed colleague Justice Jose P.
Perez.
I join the unanimous declaration that, based on the challenges posed by the present
petitions and only within its ambient facts, Section 11 of Republic Act No. 9160 or the
Anti-Money Laundering Act is not unconstitutional. Further, that we are unanimous in
declaring that the depositor has no right to demand that it be notified of any application
or issuance of an order to inquire into his or her bank deposit. The procedure in the
Court of Appeals is ex parte but requires proof of probable cause of the occurrence of
the predicate crime as well as the potential liability of the owner of the deposit.
After the inquiry of the bank deposits and related accounts within the limitations
contained in the court order, it is still the option of the law enforcers or the Anti-Money
Laundering Council, to proceed to request for a Freeze Order in accordance with Section
10 of the same law. The depositor is, thus, entitled to be informed only after the freeze
order has been issued. In questioning the freeze order, the depositor may then raise
defenses relating to the existence of sufficient evidence to lead the court to believe that
there is probable cause that a covered crime has occurred, that the depositor is a
participant in the crime, and that the stay of all transactions with respect to the bank
account is essential in order to preserve evidence or to keep the proceeds of the crime
intact for and on behalf of the victims.
I differ with the premises used to arrive at the same conclusion.
I
The numbers on a bank's ledger corresponding to the amounts of money that a
depositor has and its various transactions, especially when digitized, are definitely not
physical. Yet, just because they are not physical does not necessarily mean that they
do not partake of the kinds of "life, liberty, or property"1 protected by the due process
clause of the Constitution. Neither should it mean that the numerical equivalent of the
bank's debt to a depositor or the record of its various transactions have nothing to do
with the "persons . . . papers, and effects"2 constitutionally protected against
"unreasonable searches and seizures."3 The majority opinion's statement that the
"inquiry by the [Anti-Money Laundering Council] into certain bank deposits and
investments does not violate substantive due process, there being no physical seizure
of property involved at that stage"4 may have been inadvertent. It does, however,
neglect that the penumbra of rights protected by the due process clause and the
proscription against unreasonable searches and seizures also pertains to protecting the
intangibles essential to human life. Definitely, every liberal democratic constitutional
order has outgrown the archaic concept that life is only that which can be tangible.
The due process clause is crafted as a proscription. Thus, it states that "[n]o person
shall be deprived of life, liberty, or property without due process of law[.]"5 This means
that there is a sphere of individual existence or a penumbra of individual autonomy that
exists prior to every regulation that should primordially be left untouched. In other
words, the existence of what Louis D. Brandeis and Samuel D. Warren once called "the
right to be let alone"6 is now broadly, though at times awkwardly referred to roughly as
the right to privacy, presumed. Every regulation therefore that limits this aspect of
individuality may be the subject of inquiry that it does not "deprive" one of their "life,
liberty or property" without "due process of law".
Thus, in the often cited writings of Warren and Brandeis as early as 1890 on the right to
privacy:
That the individual shall have full protection in person and in property is a principle as
old as the common law; but it has been found necessary from time to time to define
anew the exact nature and extent of such protection. Political, social, and economic
changes entail the recognition of new rights, and the common law, in its eternal youth,
grows to meet the demands of society. Thus, in very early times, the law gave a
remedy only for physical interference with life and property, for trespasses vi et armis.
Then the "right to life" served only to protect the subject from battery in its various
forms; liberty meant freedom from actual restraint; and the right to property secured
to the individual his lands and his cattle. Later, there came a recognition of man's
spiritual nature, of his feelings and his intellect. Gradually the scope of these legal
rights broadened; and now the right to life has come to mean the right to enjoy life,—
the right to be let alone; the right to liberty secures the exercise of extensive civil
privileges; and the term "property" has grown to comprise every form of possession —
intangible, as well as tangible.
Thus, with the recognition of the legal value of sensations, the protection against actual
bodily injury was extended to prohibit mere attempts to do such injury; that is, the
putting another in fear of such injury. From the action of battery grew that of assault.
Much later there came a qualified protection of the individual against offensive noises
and odors, against dust and smoke, and excessive vibration. The law of nuisance was
developed. So regard for human emotions soon extended the scope of personal
immunity beyond the body of the individual. His reputation, the standing among his
fellow-men, was considered, and the law of slander and libel arose. Man's family
relations became a part of the legal conception of his life, and the alienation of a wife's
affections was held remediable. Occasionally the law halted,—as in its refusal to
recognize the intrusion by seduction upon the honor of the family. But even here the
demands of society were met. A mean fiction, the action per quod servitium amisit, was
resorted to, and by allowing damages for injury to the parents' feelings, an adequate
remedy was ordinarily afforded. Similar to the expansion of the right to life was the
growth of the legal conception of property. From corporeal property arose the
incorporeal rights issuing out of it; and then there opened the wide realm of intangible
property, in the products and processes of the mind, as works of literature and art,
goodwill, trade secrets, and trademarks.
This development of the law was inevitable.7 (Citations omitted)
Nothing in the structure of the due process clause limits the protected sphere of
individual existence or autonomy only to the physical or corporeal aspects of life. After
all, as we have long held, life is not limited only to physical existence.8 Property can be
incorporeal.9 Liberty denotes something more than just freedom from physical restraint.
More fundamentally, the reservation of a very broad sphere of individual privacy or
individual autonomy is implied in the very concept of society governed under a
constitutional and democratic order. The aspects of our humanity and the parts of our
liberty surrendered to the government, in order to assure a functioning society, should
only be as much as necessary for a just society and no more. While the extent of
necessary surrender cannot be determined with precision, our existing doctrine is that
any state interference should neither be arbitrary nor unfair. In many cases, we have
held that due process of law simply means that regulation should both be reasonable
and fair.
Reasonability and fairness is tentatively captured in the twin legal concepts of
substantive and procedural due process respectively. Substantive due process is
usually, though not in all cases, a nuanced means-to-end test. Basically, this means
that the regulation which impinges on individual autonomy is necessary to meet a
legitimate state interest to be protected through means that can logically relate to
achieving that end.10 Procedural due process is succinctly and most descriptively
captured in the idea that in the kinds of deprivation of rights where it would be
relevant, there should be an opportunity to be heard.11
In the due process clause, there is the requirement of "deprivation" of one's right to
"life, liberty or property." In my view, this means more than the occasional and
temporary discomforts we suffer, which is consistent with the natural workings of
groups of human beings living within a society. De minimis discomfort is a part of group
life, independent of the workings of the State. The deprivation that may trigger a
judicial inquiry should be more than momentary. It must be fundamentally disruptive of
a value that we protect because it is constitutive of our concept of individual autonomy.
For instance, a person who chooses to walk down a public street cannot complain that a
police officer glances or even stares at him or her. The discomfort of being the subject
of the observation by others, under those circumstances, may be too fleeting and trivial
that it should not cause any constitutional query. That we look at each other in public
spaces is inherently a part of existing within a society. After all, one of the worst human
indignities may be that we are rendered invisible to everyone for all time within public
spaces.
On the other hand, the uninvited and unwelcome peering eyes of the State's agents as
we reside in our most private spaces presumptively violates our right to life, liberty,
and even our property. In such cases, even the most fleeting act of voyeurism can
cause substantial disruption of our collective values. Certainly, there is reason to trigger
judicial inquiry. If the intrusion is unreasonable, it violates the constitutional protection
of the due process clause.
Examining the petitioner's bank accounts is analogous to the situation involving the
uninvited and unwelcome glance. For some, their financial worth contained in the
bank's ledgers may not be physical, but it is constitutive of that part of their identity,
which for their own reasons, they may not want to disclose. Peering into one's bank
accounts and related transactions is sufficiently disruptive as to be considered a
"deprivation" within the meaning of the due process clause. It may be short of the
physical seizure of property but it should, in an actual controversy such as this case at
bar, be subject of judicial review.
I disagree with the majority's opinion that bank accounts do not have any "legitimate
expectation of privacy[.]"12 I believe that such opinion may be too broad a reading
of Republic v. Hon. Judge Eugenio, Jr., et al.13 It is true that no bank account or
investment can be made without the cooperation of those who work with financial
intermediaries. The possibility that there are those, who may come across personal
financial information, should not be the measure of what may be "legitimate
expectation" in a constitutional sense. We should start to distinguish between
knowledge of the content of these accounts, storage of these information, exchange of
data, and making public disclosures.
What we deal with when the Court of Appeals allows inquiry is simply providing the
Anti-Money Laundering Council or the appropriate law enforcement agency with access
to knowledge of the content of these accounts. The limits of its storage, how it is
exchanged, and making public disclosures are another matter. Nothing in this decision
should be used to imply the nature of the right to privacy or the factors to be
considered to establish "legitimate expectation of privacy" as it applies to storage,
exchange, and public disclosures of information.
The truth is that most of today's digital data is vulnerable to one who is curious enough,
exceedingly determined, skillful, and willing to deploy the necessary time and resources
to make discovery of our most private information. Ubiquitous surveillance systems that
ensure the integrity as well as increase confidence in the security of the data kept in a
system are ever present. Copying or transferring digital data occurs likewise with
phenomenal speed. Data shared in cyberspace also tends to be resilient and difficult to
completely delete. Users of various digital platforms, including bank accounts, are not
necessarily aware of these vulnerabilities.
Therefore, the concept of "legitimate expectation of privacy" as the framework for
assessing whether personal information fall within the constitutionally protected
penumbra need to be carefully reconsidered. In my view, the protected spheres of
privacy will make better sense when our jurisprudence in the appropriate cases make
clear how specific types of information relate to personal identity and why this is
valuable to assure human dignity and a robust democracy in the context of a
constitutional order.
II
A bank inquiry order is a provisional relief available to the Anti-Money Laundering
Council in aid of its investigative powers. It partakes of the character of a search
warrant.
United Laboratories Inc. v. Isip14 discussed the nature of a search warrant:
On the first issue, we agree with the petitioner's contention that a search warrant
proceeding is, in no sense, a criminal action or the commencement of a
prosecution. The proceeding is not one against any person, but is solely for the
discovery and to get possession of personal property. It is a special and peculiar
remedy, drastic in nature, and made necessary because of public necessity. It
resembles in some respect with what is commonly known as John Doe proceedings.
While an application for a search warrant is entitled like a criminal action, it does not
make it such an action.
A search warrant is a legal process which has been likened to a writ of discovery
employed by the State to procure relevant evidence of crime. It is in the nature of a
criminal process, restricted to cases of public prosecutions. A search warrant is a police
weapon, issued under the police power. A search warrant must issue in the name of the
State, namely, the People of the Philippines.
A search warrant has no relation to a civil process. It is not a process for adjudicating
civil rights or maintaining mere private rights. It concerns the public at large as
distinguished from the ordinary civil action involving the rights of private persons. It
may only be applied for in the furtherance of public prosecution.15 (Emphasis supplied,
citations omitted)
In a search warrant proceeding, there is already a crime that has been committed and
law enforcers apply for a search warrant to find evidence to support a case or to
retrieve and preserve evidence already known to them.
In the same way, a bank inquiry order is "a means for the government to ascertain
whether there is sufficient evidence to sustain an intended prosecution of the account
holder for violation of the [Anti-Money Laundering Act]."16 It is a preparatory tool for
the discovery and procurement, and preservation — through the subsequent issuance
of a freeze order — of relevant evidence of a money laundering transaction or activity.
Considering its implications on the depositor's right to privacy, Section 11 of the Anti-
Money Laundering Act explicitly mandates that "[t]he authority to inquire into or
examine the main account and the related accounts shall comply with the requirements
of Article III, Sections 2 and 3 of the 1987 Constitution[.]"
Article III, Section II of the Constitution states:
SECTION 2. The right of the people to be secure in their persons, houses, papers, and
effects against unreasonable searches and seizures of whatever nature and for any
purpose shall be inviolable, and no search warrant or warrant of arrest shall issue
except upon probable cause to be determined personally by the judge after
examination under oath or affirmation of the complainant and the witnesses he may
produce, and particularly describing the place to be searched and the persons or things
to be seized.
"The phrase 'upon probable cause to be determined personally by the judge after
examination under oath or affirmation of the complainant and the witnesses he may
produce' allows a determination of probable cause by the judge [or the Court of Appeals
in Anti-Money Laundering Act cases] ex parte." 17
In People v. Delos Reyes,18 the Court held that due to the ex parte and non-adversarial
nature of the proceedings, "the [j]udge acting on an application for a search warrant is
not bound to apply strictly the rules of evidence."19
The ordinary rules of evidence are generally not applied in  ex parte proceedings, partly
because there is no opponent to invoke them, partly because the Judge's determination
is usually discretionary, partly because it is seldom that, but mainly because the
system of evidence rules was devised for the special control of trials by
jury.20(Emphasis supplied)
"The existence [of probable cause] depends to a large degree upon the finding or
opinion of the judge [or magistrate] conducting the examination."21 "However, the
findings of the judge [or magistrate] should not disregard the facts before him nor run
counter to the clear dictates of reason."22
Search warrant proceedings are ex parte because of the necessities of the
investigation.  La Chemise Lacoste, S.A. v. Hon. Fernandez, etc. et al.,23 states:
... an application for a search warrant is heard  ex parte. It is neither a trial nor a part
of the trial. Action on these applications must be expedited for time is of the essence.
Great reliance has to be accorded by the judge to the testimonies under oath of the
complainant and the witnesses.24 (Emphasis supplied)
Similarly, it is essential that investigations for Anti-Money Laundering Act offenses,
including the proceedings for the issuance of bank inquiry orders, be kept ex parte, in
order not to frustrate the State's effort in building its case and eventually prosecuting
money laundering offenses.
III
The absence of notice to the owner of a bank account that an  ex parte application as
well as an order to inquire has been granted by the Court of Appeals is not
unreasonable nor arbitrary. The lack of notice does not violate the due process clause
of the Constitution.
It is reasonable for the State, through its law enforcers, to inquire ex parte and without
notice because of the nature of a bank account at present.
A bank deposit is an obligation. It is a debt owed by a bank to its client-depositor. It is
understood that the bank will make use of the value of the money deposited to further
create credit. This means that it may use the value to create loans with interest to
another. Whoever takes out a loan likewise creates a deposit with another bank
creating another obligation and empowering that other bank to create credit once mere
through providing other loans.
Bank deposits are not isolated information similar to personal sets of preferences.
Rather, bank deposits exist as economically essential social constructs. The inherent
constitutionally protected private rights in bank deposits and other similar instruments
are not absolute. These rights should, in proper cases, be weighed against the need to
maintaining the integrity of our financial system. The integrity of our financial system
on the other hand contributes to the viability of banks and financial intermediaries, and
therefore the viability of keeping bank deposits.
Furthermore, we are at an age of instantaneous financial transactions. It would be
practically impossible to locate, preserve, and later on present evidence of crimes
covered by the Anti-Money Laundering Act if the theory of the petitioner is correct.
After all, as correctly pointed out by the majority opinion, the right to information
accrues only after a freeze order is issued. It is then that limitations on the ability to
transact the value of the bank account will truly affect the depositor.
Accordingly, with these clarifications, I vote to DENY the Petition.
Endnotes:

1
 CONST., art III, sec. I provides:
ARTICLE III. Bill of Rights
SECTION I. No person shall be deprived of life, liberty, or property without due process
of law, nor shall any person be denied the equal protection of the laws.
2
 CONST., art. III, sec. 2 provides:
ARTICLE III. Bill of Rights
....
SECTION 2. The right of the people to be secure in their persons, houses, papers, and
effects against unreasonable searches and seizures of whatever nature and for any
purpose shall be inviolable, and no search warrant or warrant of arrest shall issue
except upon probable cause to be determined personally by the judge after
examination under oath or affirmation of the complainant and the witnesses he may
produce, and particularly describing the place to be searched and the persons or things
to be seized.
3
 CONST., art. III, sec. 2
4
Ponencia, p. II.
5
 CONST., art III, sec. 1.
6
 Samuel D. Warren and Louis D. Brandeis, The Right to Privacy, 4 HARV. L. REV. 193
(1890). See also Irwin R. Kramer, The Birth of Privacy Law: A Century Since Warren &
Brandeis, 39 Cath. U.L. Rev. 703 (1990).
7
 Samuel D. Warren and Louis D. Brandeis, The Right to Privacy, 4 HARV. L. REV. 193,
193-195 (1890).
8
Secretary of National Defense, et at. v. Manalo, et al., 589 Phil. 1, 50 (2008) [Per C.J.
Puno, En Banc], explained the concept of right to life:
While the right to life under Article III, Section I guarantees essentially the right to be
alive - upon which the enjoyment of all other rights is preconditioned- the right to
security of person is a guarantee of the secure quality of this life, viz.: "The life to
which each person has a right is not a life lived in fear that his person and property
may be unreasonably violated by a powerful ruler. Rather, it is a life lived with the
assurance that the government he established and consented to, will protect the
security of his person and property. The ideal of security in life and property ...
pervades the whole history of man. It touches every aspect of man's existence." In a
broad sense, the right to security of person "emanates in a person's legal and
uninterrupted enjoyment of his life, his limbs, his body, his health, and his reputation.
It includes the right to exist, and the right to enjoyment of life while existing, and it is
invaded not only by a deprivation of life but also of those things which are necessary to
the enjoyment of life according to the nature, temperament, and lawful desires of the
individual." (Citations omitted)
See also J. Leonen, Separate Opinion in International Service for the Acquisition of
Agri-Biotech Applications, Inc. v. Greenpeace Southeast Asia (Philippines), G.R. No.
209271, December 8, 2015, 776 SCRA 434, 644 [Per J. Villarama, Jr., En Banc].
9
 CIVIL CODE, arts. 415(10), 417, 519, 520, 521, 613, 721, and 722 provide:
Article 415. The following are immovable property:
....
(10) Contracts for public works, and servitudes and other real rights over immovable
property.
....
Article 417. The following are also considered as personal property:
(1) Obligations and actions which have for their object movables or demandable sums;
and
(2) Shares of stock of agricultural, commercial and industrial entities, although they
may have real estate.
....
Article 519. Mining claims and rights and other matters concerning minerals and
mineral lands are governed by special laws.
Article 520. A trade mark or trade-name duly registered in the proper government
bureau or office is owned by and pertains to the person, corporation, or firm registering
the same, subject to the provisions of special laws.
Article 521. The goodwill of a business is property, and may be transferred together
with the right to use the name under which the business is conducted.
Article 613. An easement or servitude is an encumbrance imposed upon an immovable
for the benefit of another immovable belonging to a different owner. The immovable in
favor of which the easement is established is called the dominant estate; that which is
subject thereto, the servient estate.
Article 721. By intellectual creation, the following persons acquire ownership:
(1) The author with regard to his literary, dramatic, historical, legal, philosophical,
scientific or other work;
(2) The composer, as to his musical composition;
(3) The painter, sculptor, or other artist, with respect to the product of his art;
(4) The scientist or technologist or any other person with regard to his discovery or
invention.
Article 722. The author and the composer, mentioned in Nos. 1 and 2 of the preceding
article, shall have the ownership of their creations even before the publication of the
same. Once their works are published, their rights are governed by the Copyright laws.
The painter, sculptor or other artist shall have dominion over the product of his art
even before it is copyrighted.
The scientist or technologist has the ownership of his discovery or invention even
before it is patented.
INTELLECTUAL PROP. CODE, secs. 28, 71, 103, 147.1, 165.1, 165.2, and 177 provide:
SECTION 28. Right to a Patent. The right to a patent belongs to the inventor, his heirs,
or assigns. When two (2) or more persons have jointly made an invention, the right to
a patent shall belong to them jointly.
....
SECTION 71. Rights Conferred by Patent.-
71.1. A patent shall confer on its owner the following exclusive rights:
a. Where the subject matter of a patent is a product, to restrain,
prohibit and prevent any unauthorized person or entity from
making, using, offering for sale, selling or importing that product;
b. Where the subject matter of a patent is a process, to restrain,
prevent or prohibit any unauthorized person or entity from using
the process, and from manufacturing, dealing in, using, selling or
offering for sale, or importing any product obtained directly or
indirectly from such process.
71.2. Patent owners shall also have the right to assign, or transfer by succession the
patent, and to conclude licensing contracts for the same.
....
SECTION 103. Transmission of Rights.-
103.1. Patents or applications for patents and invention to which they relate, shall be
protected in the same way as the rights of other property under the Civil Code.
103.2. Inventions and any right, title or interest in and to patents and inventions
covered thereby, may be assigned or transmitted by inheritance or bequest or may be
the subject of a license contract.
....
SECTION 147. Rights Conferred.-
147.1. The owner of a registered mark shall have the exclusive right to prevent all third
parties not having the owner's consent from using in the course of trade identical or
similar signs or containers for goods or services which are identical or similar to those
in respect of which the trademark is registered where such use would result in a
likelihood of confusion. In case of the use of an identical sign for identical goods or
services, a likelihood of confusion shall be presumed.
....
SECTION 165. Trade Names or Business Names.-
165.1. A name or designation may not be used as a trade name if by its nature or the
use to which such name or designation may be put, it is contrary to public order or
morals and if, in particular, it is liable to deceive trade circles or the public as to the
nature of the enterprise identified by that name.
165.2.
a. Notwithstanding any laws or regulations providing for any obligation to register trade
names, such names shall be protected, even prior to or without registration, against
any unlawful act committed by third parties.
b. In particular, any subsequent use of the trade name by a third party, whether as a
trade name or a mark or collective mark, or any such use of a similar trade name or
mark, likely to mislead the public, shall be deemed unlawful.
....
SECTION 177. Copyright or Economic Rights. - Subject to the provisions of Chapter
VIII, copyright or economic rights shall consist of the exclusive right to 'carry out,
authorize or prevent the following acts:
177.1. Reproduction of the work or substantial portion of the work;
177.2. Dramatization, translation, adaptation, abridgment, arrangement or other
transformation of the work;
177.3. The first public distribution of the original and each copy of the work by sale or
other forms of transfer of ownership;
177.4. Rental of the original or a copy of an audiovisual or cinematographic work, a
work embodied in a sound recording, a computer program, a compilation of data and
other materials or a musical work in graphic form, irrespective of the ownership of the
original or the copy which is the subject of the rental;
177.5. Public display of the original or a copy of the work;
177.6. Public performance of the work; and
177.7. Other communication to the public of the work.
10
City of Manila v. Hon. Laguio, Jr., 495 Phil. 289, 311-312 [Per J. Tinga, En Banc],
states, "[s]ubstantive due process, as that phrase connotes, asks whether the
government has an adequate reason for taking away a person's life, liberty, or
property. In other words, substantive due process looks to whether there is sufficient
justification for the government's action. Case law in the United States (U.S.) tells us
that whether there is such a justification depends very much on the level of scrutiny
used. For example, if a law is in an area where only rational basis review is applied,
substantive due process is met so long as the law is rationally related to a legitimate
government purpose. But if it is an area where strict scrutiny is used, such as for
protecting fundamental rights, then the government will meet substantive due process
only if it can prove that the law is necessary to achieve a compelling government
purpose."
Further, in Mosqueda, et al. v. Pilipino Banana Growers & Exporters Association, Inc., et
al., G.R. No. 189185, August 16, 2016 <
http://sc.judiciary.gov.ph/pdf/web/viewer.html?
file=/jurisprudence/2016/august2016/189185.pdf > 28 [Per J. Bersamin, En Banc], the
Court referred to three levels of scrutiny in analysing the validity of governmental
intrusion: the rational basis test, which inquires into the reasonable relation between
the means and purpose of the law; the intermediate or heightened review where "the
law must not only further an important governmental interest and be substantially
related to that interest, but ... the classification ... must not depend on broad
generalizations[;]" (Id.) and the  strict scrutiny review, where the Government must
prove the necessity "to achieve a compelling state interest, and that [the law or
ordinance] is the least restrictive means to protect such interest." (Id.) In Mosqueda,
The Court declared unconstitutional Davao City Ordinance No. 0309-07, (Id. at 46)
which imposed a ban in aerial spraying as an agricultural practice, for being "broad
because the ordinance applies irrespective of the substance to be aerially applied and
irrespective of the agricultural activity to be conducted[;]" (Id. at 34) and for being
unreasonable and oppressive, "in light of the existence and availability of more
permissible and practical alternatives that will not overburden ... those who stand to be
affected." (Id. at 36).
See also Serrano v. Gallant Maritime Services, Inc., et al., 601 Phil. 245 (2009) [Per J.
Austria Martinez, En Banc], White Light Corporation, et al. v. City of Manila, 596 Phil.
444, 461-464 (2009) [Per J. Tinga, En Banc]; Blo Umpar Adiong v. Commission on
Elections, G.R. No. 103956, March 31, 1992, 207 SCRA 712 [Per J. Gutierrez, Jr., En
Banc].
11
Gutierrez v. Commission on Audit, G.R. No. 200628, January 13, 2015, 745 SCRA
435, 452-453 [Per J. Leonen, En Banc); Montinola v. Philippine Airlines, G.R. No.
198656, September 8, 2014, 734 SCRA 439, 459-460 [Per J. Leonen, Second
Division); Department of Agrarian Reform v. Samson, et al., 577 Phil. 370, 380 (2008)
[Per J. Ynares-Santiago, Third Division]; F/O Ledesma v. Court of Appeals, 565 Phil.
731, 740 (2007) [Per J. Tinga, Second Division]; Air Philippines Corporation v.
International Business Aviation Services Philippines, Inc., 481 Phil. 366, 386 (2004)
[Per J. Panganiban, Third Division]; Macayayong v. Hon. Ople, 281 Phil. 419, 423-424
(1991) [Per J. Bidin, Third Division]; Ang Tibay v. Court of Industrial Relations, 69 Phil.
635, 641-642 (1940) [Per J. Laurel, En Banc].
12
Ponencia, p. 11.
13
 569 Phil. 98 (2008) [Per J. Tinga, Second Division].
14
 500 Phil. 342 (2005) [Per J. Callejo, Sr., Second Division].
15
 Id. at 357-358.
16
Republic v. Hon. Judge Eugenio, Jr., et al., 569 Phil. 98, 120 (2008) [Per J. Tinga,
Second Division].
17
Mendoza v. People, et al., 733 Phil. 603, 613 (2014) [Per J. Leonen, Third Division].
18
People v. Delos Reyes, 484 Phil. 271 (2004) [Per J. Callejo, Sr., Second Division].
19
 Id. at 285.
20
 Id., citing Brinegar v. United States, 93 L.ed. 1879 (1949).
21
Santos v. Pryce Gases, Inc., 563 Phil. 781, 793 (2007) [Per J. Tinga, Second
Division].
22
 Id.
23
 214 Phil. 332 (1984) [Per J. Gutierrez, Jr., First Division].
24
 Id. at 350.