Achilles’ heel
The impeachment trial of Supreme Court Chief Justice Renato Corona resumes today with startling developments set off by Ombudsman Conchita Carpio-Morales’ investigation of the cases filed by a group of individuals against the embattled Chief Justice.
In an order dated April 20, Carpio Morales directed Corona to explain in writing “how he acquired several peso and dollar accounts, allegedly “grossly disproportionate” to his salary, in different banks.” According to the report, Morales had received information “there are several bank accounts in Philippine Savings Bank and several other banks in Corona’s name, including those denominated in US dollars the aggregate value of which amounts to at least US$10 million”.
The Ombudsman was taking cognizance of the case filed by former Akbayan congresswoman Risa Hontiveros-Baraquel, Harvey Keh of Kaya Natin, Ruperto Aleroza of the Pambansang Katipunan ng mga Samahan sa Kanayunan, Albert Concepcion of PUSO and Gibby Gorres of the Student Council Alliance of the Philippines. On Feb. 17, the group asked the Ombudsman to look into Corona’s possible accumulation of illegal wealth and violation of R.A. 9160, otherwise known as the Anti-Money Laundering Act.
In reply to the Ombudsman, Corona said the US $10 million account does not exist. He criticized the order saying it was part of black propaganda in retaliation for the High Court’s ruling on Hacienda Luisita.
The matter of CJ Corona’s dollar deposits was a high point during the early stages of the impeachment trial because while the prosecution tried to pin him down based on his alleged ill-gotten wealth, the defense made mincemeat of their counterpart’s amateurish strategies. The prosecution had earlier presented to the Senate five dollar accounts and five peso accounts to substantiate charges that Corona failed to fully disclose his properties in his Statement of Assets, Liabilities and Net Worth (SALN) and might have accumulated ill-gotten wealth, including “bank accounts with huge deposits.” The defense prevailed using as basis the bank secrecy law, a feat that was more or less cemented by the Supreme Court’s issuance of a temporary restraining order against the opening of the dollar accounts.
The Ombudsman did not explain how she got information related to the $10 million account, but news reports point to a waiver at the bottom of the SALN. When signed by government officials and employees, the SALN form authorizes the Ombudsman to secure relevant records from government agencies, especially those needed to examine their net worth declarations.
The Ombudsman may have mobilized the Anti-Money Laundering Council (AMLC) to get to the bottom of Corona’s bank accounts. The AMLC is a composite group tasked by law to add more teeth to R.A. 9160. The group is composed of the governor of the Bangko Sentral ng Pilipinas as chairman and the commissioner of the Insurance Commission and the chairman of the Securities and Exchange Commission as members.
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R.A. 9160 is a landmark law that defines money laundering as “a crime whereby the proceeds of an unlawful activity are transacted or attempted to be transacted to make them appear to have originated from legitimate sources.” The illegal activity has been widely used by underworld elements to conceal their criminal activities such as smuggling, drug trafficking, prostitution and kidnapping for ransom. Embezzlement, insider trading like stock exchange scam and Internet fraud schemes can produce large profits and create incentives to “legitimize” the ill-gotten gains through money laundering.
Congress passed R.A. 9160 in the early 90s because of international pressure brought on by the so-called G-7 (France, Germany, Italy, Japan, United Kingdom, United States and Canada). In the 1989 Paris summit, G-7 governments took the bull by the horns to counter the mounting problem of money laundering, used not only by underworld organizations but also by despotic and corrupt governments to conceal their evil deeds.
The Jose Velarde account in Equitable PCIBank was said to be a case of overconfidence on the part of an ousted president, but it can be a classic example. The bank transaction records allowed the hidden assets, said to contain at least P1 billion when it was initially opened, to be located and established. Although the real owner tried to conceal his identity, a bank official’s testimony in the impeachment trial that she was just a few meters away from then president Joseph Estrada when he signed the bank documents under the name Jose Velarde, blew the lid off the illegal activities committed by the highest official of the land.
Criminal groups can evade the law by bribery and intimidation but their very operation is its own Achilles’ heel because there is always a paper trail when one goes into financial transactions.
