secrecy of bank deposits and unclaimed balances law pdf

Secrecy Of Bank Deposits And Unclaimed Balances Law Pdf

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Book three — special banking laws — is in the works and will be released this year.

WHEREAS, the law also provides for the publication of summons and a notice upon the commencement of the prescribed judicial proceedings for the escheat of unclaimed balances;. WHEREAS, past experience has shown that the cost of publication required by law, the increase of which has been substantial the past few years, is more than the aggregate amount of the unclaimed balances to be escheated, the average amount of which is small;. WHEREAS, there is a felt need to simplify the procedure for the escheat of unclaimed balances for the purpose of reducing the expenses therefor;.

Law on Secrecy bank deposits and Unclaimed balances

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Words: 5, Pages: It is hereby declared to be the policy of the Government to give encouragement to the people to deposit their money in banking institutions and to discourage private hoarding so that the same may be properly utilized by banks in authorized loans to assist in the economic development of the country.

Section 2. As amended by PD No. It shall be unlawful for any official or employee of a banking institution to disclose to any person other than those mentioned in Section two hereof any information concerning said deposits.

Section 4. Section 5. Any violation of this law will subject offender upon conviction, to an imprisonment of not more than five years or a fine of not more than twenty thousand pesos or both, in the discretion of the court.

Section 6. This Act shall take effect upon its approval. Approved: September 9, The purpose of this law is to encourage deposit in banking institutions; and discourage private hoarding so that banks may lend such funds and assist in the economic development of the country. Act No. Deposits are characterized as being in the nature of a simple loan. The placing of deposits in a bank creates a creditor-debtor relationship between the depositor and the bank.

As such, the bank, being the debtor, has the obligation to pay a certain sum of money to the depositor, being the creditor. Government bonds are debt securities which are unconditional obligations of the State, and backed by its full taxing power. Government bonds include treasury bills, treasury notes, retail treasury bonds, dollar linked peso notes, and other risk-free bonds. Disclosure by any official or employee of any banking institution to any authorized person of any information concerning said deposit.

Any bank official, director, employee or agent who discloses information relative to funds or properties in the custody of the bank may also be held liable under the applicable provisions of the General Banking Law, Thrift Banks Act and Rural Banks Act.

For consent to be valid, it should be made knowingly, voluntarily and with sufficient awareness of the relevant circumstances and likely consequences.

XI, Sec. The money deposited should be the very thing in dispute. Mellon Bank, N. Magsino, S. M wrote about this information in his newspaper column. G filed a complaint against M for unlawfully disclosing information about her bank account.

The suit will not prosper. The Law on Secrecy of Bank Deposits does not penalize the mere receipt of information about a bank account. Neither could he be penalized under Sec. A has P10, in his savings account, P20, in his checking account, P30, in his money market placement and P40, in a trust fund.

Which of the accounts are covered by the Secrecy of Bank Deposits Law? Only the savings and checking account are covered. The money market placement and the trust fund is not covered. A bought some goods from a department store and paid with his personal check. The check was dishonored. The drawee bank refused to disclose the name of the drawer invoking the Secrecy of Bank Deposits Law.

In this case, the bank is not justified in not divulging the name of the drawer to the store manager. The store manager is merely inquiring as to the name of the drawer of the check. To divulge the same would not in any way amount to disclosure of any information concerning his deposits.

Also, the inquiry is not an investigation of any balance in favor of the drawer. To include such disclosure within the ambit of the prohibition would be unduly straining and stretching the meaning of the Secrecy of Bank. Include credits or deposits of: a.

Money b. Bullion c. Security d. Other evidence of indebtedness 2. The credit or deposit must be with the bank, building and loan association, or trust corporation, and 3. The credit or deposit is in favor of a person: a. Known to be dead, or b. The respective managers of the banks submitted to the Treasurer of the RP separate statements prepared under oath which listed all deposits and credits held by them in favor of depositors and creditors either known to be dead, have not been heard from, of have not made deposits or withdrawals for ten years or more.

RP prayed that the publication of the list of unclaimed balances be dispensed with. It asserted that the only requirement under the UBL is the publication of summons and notice to all persons and that to publish the names and list of unclaimed balances would only result in additional and unnecessary expenses to the government.

The publication of the list of unclaimed balances is intended to safeguard the right of the depositor, their heirs and successors to due process. How would other persons who may have interest in any of the unclaimed balances know what this case is all about and whether they have an interest in this case if the amended complaint and the said list are not published?

Such other persons may be heirs of the bank depositors named in the list. The fact that the government is in a tight financial situation is not a justification for the Court to dispense with the elementary rule of due process.

Sections 1, 2, 3, 4, and 5 of Act No. Such unclaimed balances, together with the increase and proceeds thereof, shall be deposited with the Treasurer of the Philippines to the credit of the Government of the Republic of the Philippines to be used as the National Assembly may direct. Whenever the Solicitor General shall be informed of such unclaimed balances, he shall commence an action or actions in the name of the People of the Republic of the Philippines in the Court of First Instance of the province or city where the bank, building and loan association or trust corporation is located, in which shall be joined as parties the bank, building and loan association or trust corporation and all such creditors or depositors.

All or any of such creditors or depositors or banks, building and loan association or trust corporations may be included in one action. Service of process in such action or actions shall be made by delivery of a copy of the complaint and summons to the president, cashier, or managing officer of each defendant bank, building and loan association or trust corporation and by publication of a copy of such summons in a newspaper of general circulation, either in English, in Filipino, or in a local dialect, published in the locality where the bank, building and loan association or trust corporation is situated, if there be any, and in case there is none, in the City of Manila, at such time as the court may order.

Upon the trial, the court must hear all parties who have appeared therein, and if it be determined that such unclaimed balances in any defendant bank, building and loan association or trust corporation are unclaimed as hereinbefore stated, then the court shall render judgment in favor of the Government of the Republic of the Philippines, declaring that said unclaimed balances have escheated to the Government of the Republic of the Philippines and commanding said bank, building and loan association or trust corporation to forthwith deposit the same with the Treasurer of the Philippines to credit of the Government of the Republic of the Philippines to be used as the National Assembly may direct.

A copy of said notice shall be attached to, and published with the copy of, said summons required to be published as above, and at the end of the copy of such notice so published, there shall be a statement of the date of publication, or first publication, if there are several, of said summons and notice. Any person interested may appear in said action and become a party thereto. Upon the publication or the completion of the publication, if there are several, of the summons and notice, and the service of the summons on the defendant banks, building and loan associations or trust corporations, the court shall have full and complete jurisdiction in the Republic of the Philippines over the said unclaimed balances and over the persons having or claiming any interest in the said unclaimed balances, or any of them, and shall have full and complete jurisdiction to hear and determine the issues herein, and render the appropriate judgment thereon.

If the president, cashier or managing officer of the bank, building and loan association, or trust corporation neglects or refuses to make and file the sworn statement required by this action, such bank, building and loan association, or trust corporation shall pay to the Government the sum of five hundred pesos a month for each month or fraction thereof during which such default shall continue.

Any bank, building and loan association or trust corporation which shall make any deposit with the Treasurer of the Philippines in conformity with the provisions of this Act shall not thereafter be liable to any person for the same and any action which may be brought by any person against in any bank, building and loan association, or trust corporation for unclaimed balances so deposited with the Treasurer of the Philippines shall be defended by the Solicitor General without cost to such bank, building and loan association or trust corporation.

This Decree shall take effect immediately. Office of the Solicitor General for plaintiff-appellant. Picazo, Lichauco and Agcaoili for defendant-appellee. It is alleged that pursuant to Section 2 of said Act defendant banks forwarded to the Treasurer of the Philippines a statement under oath of their respective managing officials of all the credits and deposits held by them in favor of persons known to be dead or who have not made further deposits or withdrawals during the period of 10 years or more.

Wherefore, it is prayed that said credits and deposits be escheated to the Republic of the Philippines by ordering defendant banks to deposit them to its credit with the Treasurer of the Philippines.

In its answer the First National City Bank of New York claims that, while it admits that various savings deposits, pre-war inactive accounts, and sundry accounts contained in its report submitted to the Treasurer of the Philippines pursuant to Act No.

Hence, it prayed that said items be not included in the claim of plaintiff. After hearing the court a quo rendered judgment holding that cashier's is or manager's checks and demand drafts as those which defendant wants excluded from the complaint come within the purview of Act No.

Consequently, the complaint was dismissed with regard to the latter. But, after a motion to reconsider was filed by defendant, the court a quo changed its view and held that even said demand drafts do not come within the purview of said Act and so amended its decision accordingly.

Plaintiff has appealed. Section 1, Act No. Such unclaimed balances, together with the increase and proceeds thereof, shall be deposited with the Insular Treasure to the credit of the Government of the Philippine Islands to be as the Philippine Legislature may direct. It would appear that the term "unclaimed balances" that are subject to escheat include credits or deposits money, or other evidence of indebtedness of any kind with banks, in favor of any person unheard from for a period of 10 years or more.

And as correctly stated by the trial court, the term "credit" in its usual meaning is a sum credited on the books of a company to a person who appears to be entitled to it.

It presupposes a creditor-debtor relationship, and may be said to imply ability, by reason of property or estates, to make a promised payment In re Ford, 14 F. It is the correlative to debt or indebtedness, and that which is due to any person, a distinguished from that which he owes Mountain Motor Co. Solof, S. Walsh, 61 Atl. Hopkins, U. Nelson, F. Treat, 7 Mass.

The same is true with the term "deposits" in banks where the relationship created between the depositor and the bank is that of creditor and debtor Article , Civil Code; Gullas vs. National Bank, 62 Phil. Pacific Coast Biscuit Co. The questions that now arise are: Do demand draft and telegraphic orders come within the meaning of the term "credits" or "deposits" employed in the law? Can their import be considered as a sum credited on the books of the bank to a person who appears to be entitled to it?

Do they create a creditor-debtor relationship between drawee and the payee?

Secrecy Of Bank Deposits And Unclaimed Balances Law

It is hereby declared to be the policy of the Government to give encouragement to the people to deposit their money in banking institutions and to discourage private hoarding so that the same may be properly utilized by banks in authorized loans to assist in the economic development of the country. 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. It shall be unlawful for any official or employee of a banking institution to disclose to any person other than those mentioned in Section two hereof any information concerning said deposits. Any violation of this law will subject offender upon conviction, to an imprisonment of not more than five years or a fine of not more than twenty thousand pesos or both, in the discretion of the court. This website uses information-gathering tools including cookies and other similar technology. Data generated are not shared with any other party.

Recommend Documents. Unclaimed Balances Unclaimed BalancesFull description. Not intended to infringe any copyright. For academic purposes only. Bank secrecy Bank secry actFull description. Loans and Deposits Loans and Depositis T Angels of Secrecy Codex.

This document was uploaded by user and they confirmed that they have the permission to share it. If you are author or own the copyright of this book, please report to us by using this DMCA report form. Report DMCA. Home current Explore. Words: 8, Pages: Polytechnic University of the Philippines Sta. It is hereby declared to be the policy of the Government to give encouragement to the people to deposit their money in banking institutions and to discourage private hoarding so that the same may be properly utilized by banks in authorized loans to assist in the economic development of the country.


For peso deposits, Republic Act No (Bank Deposits' Secrecy. Law) declares all deposits of whatever nature with banks in the. Philippines, including.


Secrecy of Bank Deposits and Unclaimed Balances Law

WHEREAS, limited examination powers operate against effective supervision of banks and endangers the safety of deposits which may affect the public's faith in the banking system. MARCOS, President of the Philippines, by virtue of the powers in me vested by the Constitution, do hereby decree and make the following part of the law of the land;. Section 1. It is hereby declared to be the policy of the Government to give encouragement to the people to deposit their money in banking institutions and to discourage private hoarding so that the same may be properly utilized by banks in authorized loans to assist in the economic development of the country.

Secrecy of Bank Deposits and Unclaimed Balances Law

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Law on Secrecy bank deposits and Unclaimed balances

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Law on Secrecy of Bank Deposits

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