Senators start probe of Corona bank leak

Senate President Juan Ponce Enrile

Senators were left more confused than ever after hearing the conflicting stories given by resource persons from the Bangko Sentral ng Pilipinas (BSP) and Philippine Savings Bank (PSBank) who may have had a first-hand look at the bank records of Chief Justice Renato Corona, Senate President Juan Ponce Enrile said Monday.

The Senate committee on banks, financial institutions and currencies held its first hearing on the alleged leak that allowed the House prosecution panel in Corona’s impeachment trial to obtain a photocopy of the Chief Justice’s confidential bank records.

“All I can say is that we are going through murky waters,” Enrile said with a shrug after leaving the hearing.

The committee chairman, Senator Sergio Osmeña III, said there was a “need to do more detective work” after listening to the statements of PSBank president Pascual Garcia III and BSP examiners.

House prosecutors, who charged Corona with betrayal of public trust and culpable violation of the Constitution and other offenses, had presented evidence at the trial alleging that the Chief Justice had kept five accounts in PSBank that contained at least P24.6 million between 2007 and 2010.

Furor over source

For 2010, the prosecution claimed that Corona had a total of P31.75 million in deposits in two PSBank accounts and in one Bank of Philippine Islands account, but declared only

P3.5 million in cash and investments in his statement of assets, liabilities and net worth.

The prosecution’s presentation at the impeachment trial of a photocopy supposedly of Corona’s signature card has created a furor among several senator-judges over its source and authenticity.

Quoting PSBank records, Garcia said an examination team from the BSP asked specifically for Corona’s “account opening forms, ‘Know Your Client’ (KYC) documents, screen shots and other related documents” from the Katipunan branch on Nov. 8, 2010.

Garcia earlier told the impeachment court that a “team” of  BSP and Anti-Money Laundering Council (AMLC) representatives asked to look at the Chief Justice’s records at the time a regular audit of the bank was made by the BSP from September to November 2010.

Garcia noted that Corona was just one of eight depositors in the Katipunan branch whose records were examined by the BSP.

Elmer Damasco, the head of the BSP examining team, told the Senate committee that his audit was limited to PSBank’s head office and the Binondo branch. “I did not examine (records from the branch in) Katipunan,” Damasco said.

Garcia countered that “documentation” from PSBank would show that Damasco had actually asked to look at the records of a total of 112 accounts, apparently from various branches.

Jerry Leal, a BSP bank examiner, later admitted he was the one who singled out these 112 accounts for scrutiny.

Leal said the accounts were chosen from those who made “high-volume transactions” of at least P500,000 from June to August 2010.

Under the law, banks are required to report transactions that reach this level to the AMLC.

Leal said the accounts were “chosen as sample for verification for the whole PSBank.”

“None came from Katipunan as far as I note,” he said.

Randomly selected

Leal also assured the Senate committee that the accounts chosen for scrutiny were “randomly selected” and were apparently chosen in haste as he “only had two weeks” (to examine and) he “had to join another examining team.”

Senate Majority Leader Vicente Sotto asked whether “a politician or any higher authority” pressured Leal into conducting the examination of PSBank records.

The BSP examiner said his random selection of accounts were based on his “own expert judgment.”

Senator Joker Arroyo later noted that BSP personnel “have no business enforcing” the Anti-Money Laundering Act (Amla) as the AMLC was an independent body.

Vicente Aquino, AMLC executive director, explained that the law allowed the BSP to inquire into or examine bank deposits “to ensure compliance with Amla.”

BSP access

“The BSP has access to covered or suspicious transaction reports. If there is a possible violation of the Amla, a BSP money laundering specialist group can forward (information) to AMLC for appropriate action,” Aquino said.

“Confusion arises because your unit is an AMLC specialist group but you (BSP examiners) are not employees of AMLC,” said Senator Teofisto Guingona III.

Guingona was the one who immediately corrected Garcia in his testimony before the impeachment trial two weeks back that the AMLC per se was not involved in the regular audit of banks conducted by the BSP.

On further questioning Monday, Garcia recalled that Leal, on Nov. 24, 2010, furnished PSBank a copy of a communication transmitted through e-mail to Damasco.

While Garcia did not discuss the contents of this letter, he said PSBank “on basis of (this e-mail) prepared a list of accounts attached with some other findings,” including Corona’s bank account in the Katipunan branch.

Politically exposed

Garcia recalled that these eight accounts were singled out because they were not tagged as “PEP” to indicate that their deposits belonged to “politically exposed persons.”

This detail prompted Enrile to note that photocopies of Corona’s accounts presented by the prosecution were believed taken from the PSBank Katipunan branch.

“There is a claim that the document that became the basis for the subpoena duces tecum based on the supplementary request of the prosecution came from your bank, but (Katipunan branch manager Annabelle) Tiongson said the document was fake,” said the Senate President.

“We want to find out whether that document really [came] from your bank and how it happened that it was released and why it was released (so it was later) attached to the supplementary request,” Enrile added.

Garcia said Corona’s signature card was “submitted” to Leal. The BSP examiner immediately denied this. “You are under oath,” Enrile reminded Leal.

Arroyo asked Garcia “how many people” handled Corona’s bank records.

Photocopy during audit

Garcia said a photocopy of Corona’s records was made at the time the BSP conducted the audit in 2010.

He added this photocopy was “given to AMLC at the exit point” of the audit.

“We are not accusing anyone yet. But who asked for a photocopy of that document?” Arroyo asked.

“We believe the examiner, Mr. Leal,” Garcia replied.

Enrile then queried whether PSBank had proof to support Garcia’s claim.

Garcia maintained that the e-mail that Leal had addressed to Damasco would suffice. He added that after the submission, Leal even filed a comment telling PSBank that it failed to tag certain depositors as PEP.

Leal, however, countered that his team “only requested PEP identification” of the depositors who belonged to this category.

“I asked the bank to submit to me a screen shot of the customer, the information file of the Chief Justice but not his signature card,” he said.

Leal added that “it does not make sense” to ask for documents like KYC records, signature cards and account opening forms as the only issue was PSBank’s failure to properly identify PEP clients.

This prompted Sotto to note that the photocopy of Corona’s signature card given by the prosecution panel “did not bear the PEP tag.”

Garcia refused to comment when Sotto asked for his opinion about the matter.