EJERCITO v.

SANDIGANBAYAN
Nov. 30, 2006 | CARPIO MORALES, J. | Rules of Exclusion > RA 6426 | Cachapero

PETITIONER/S: Joseph Victor G. Ejercito

RESPONDENT/S: Sandiganbayan and People
SUMMARY: Prosecution requested for issuance of subpoenas over bank documents. Petitioner opposed,
alleging bank secrecy. Court held that the docs fell under the exceptions of RA 1405. The fruit of the
poisonous tree doctrine also does not apply since the law itself does not provide that unlawful
examinations of bank accounts would render the inadmissibility of such information in evidence.
DOCTRINE/S: See Analysis # 6, 7, and 9.

FACTS:
1. In People v. Estrada, the Special Prosecution Panel filed a Request for Issuance of Subpoena Duces
Tecum to direct the President of Export and Industry Bank to produce the ff. documents:
1. For Trust Acct. 858:
1. Acct. Opening Documents
2. Trading Order No. 020385
3. Confirmation Advice TA 858
4. Copies of 1 Bank of Commerce Managers Check, and 3 Urban Bank Managers
Checks, with total amount of over PHP 100M.
5. Trust Agreement between Petitioner and Urban Bank
6. Ledger of SPAN #858.
2. For Savings Acct. 0116-17345-9
1. Signature Cards
2. Statement of Account/Ledger
3. Urban Bank Managers Checks and their corresponding Application forms, amounting to
over PHP 70M.
2. They also filed a Request for Issuance of Subpoena Duces Tecum/Ad Testificandum to direct
Equitable PCI Bank to produce SOAs pertaining to accounts named under Jose Velarde, and to
testify thereon. Both were granted, and were issued.
3. Another Request was issued on the President of EIB to produce the same docs and to testify thereon.
Granted by Sandiganbayan and issued.
4. Petitioner claims to have learned about the Requests from the media, filed a letter before the
Sandiganbayan, alleging an anomaly with regard to Bank Secrecy, since the prosecution was able
to specifically identify certain bank record down to the account number, etc. (letter reproduced
verbatim with emphasis on Ejercitos use of my accounts.
5. Sandiganbayan advised petitioner that his remedy was a motion to quash the subpoenas. In such
MtoQ, he claimed that his accounts are covered by RA 1405 (The Secrecy of Bank Deposits Law),
and alleged that the specific details in the requests could only have been made possible by an earlier
illegal disclosure by EIB and PDIC (receiver of Urban Bank). He further claimed that these cannot
be used against him as they were illegally acquired.
6. Before MtoQ was resolved, another Request for Subpoena was filed to direct Pres. Of EIB to
produce the same docs, except that 1 Bank of Commerce Check was for the amount of PHP 200k
instead of 200M. It also requested for additional docs for a different savings account (1701-00646-
1).
7. Another request was made directed to Baldoz, VP of PDIC to produce 3 Letters of Authority re:
SPAN 858, 2 Urban Bank checks amounting to over PHP 140M, and a Signature Card Savings
Acct. # 0116-17345-9 (same as in #1, subsection 2). Both were granted.
8. Petitioner filed an Urgent Motion to Quash to include the new subpoenas, for the same reasons.
This and the previous MtoQ, were denied.
ISSUE/S & HELD:
1. W/N the allegedly specific information in the Requests were obtained through prior illegal
disclosures, and thus, in violation of the fruit of the poisonous tree doctrine? <No>

RULE/S:
1. Sec. 1, RA 1405 - 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.
2. Sec. 2, RA 1405 - 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.
3. PNB v. Gancayco: Cases of unexplained wealth are similar to cases of bribery or dereliction of
duty and no reason is seen why these two classes of cases cannot be excepted from the rule making
bank deposits confidential. The policy as to one cannot be different from the policy as to the
other. This policy expresses the notion that a public office is a public trust and any person who
enters upon its discharge does so with the full knowledge that his life, so far as relevant to his duty,
is open to public scrutiny.
4. Sec. 2, RA 7080 - Definition of the Crime of Plunder; Penalties. Any public officer who, by himself
or in connivance with members of his family, relatives by affinity or consanguinity, business
associates, subordinates or other persons, amasses, accumulates or acquires ill-gotten
wealth through a combination or series of overt or criminal acts as described in Section 1(d) hereof,
in the aggregate amount or total value of at least Seventy-five million pesos (P75,000,000.00), shall
be guilty of the crime of plunder
5. Sec. 1(d)(2), RA 7080 - By receiving, directly or indirectly, any commission, gift, share,
percentage, kickbacks or any other form of pecuniary benefit from any person and/or entity in
connection with any government contract or project or by reason of the office or position of the
public officer concerned;
6. US v. Frazin: Because the statute, when properly construed, excludes a suppression remedy, it
would not be appropriate for us to provide one in the exercise of our supervisory powers over the
administration of justice. Where Congress has both established a right and provided exclusive
remedies for its violation, we would encroach upon the prerogatives of Congress were we to
authorize a remedy not provided for by statute.
7. US v. Thompson: When Congress specifically designates a remedy for one of its acts, courts
generally presume that it engaged in the necessary balancing of interests in determining what the
appropriate penalty should be. Absent a specific reference to an exclusionary rule, it is not
appropriate for the courts to read such a provision into the act.

ANALYSIS:
1. Trust accounts are covered by the term deposits, per an examination of the law. The term is to be
understood broadly and not limited to accounts which give rise to a creditor-debtor relationship
between the depositor and the bank. Basically, if the money deposited may be used by the bank for
loans, then such account falls under those which the law protects. The Trust Account in this case is
one such account, as the said account covers deposit, placement, or investment by the bank.
 2. Exceptions to Bank Secrecy Law: (1) examination of bank accounts is upon order of a competent
court in cases of bribery or dereliction of duty by public officials; (2) money deposited or invested
is the subject matter of litigation.
1. Petitioner contends that Plunder is neither bribery nor dereliction of duty. PNB v.
Gancayco, however, holds otherwise (See Rule #3). The same goes for the definition of
the crime under Sec. 2 and 1(d) of RA 7080. (See Rule #s 4 and 5).
3. Basically, the Court held that Plunder falls under the category of crimes that are committed by
public officers involving ill-gotten wealth. Plunder was held to be analogous to bribery, and thus,
held to be applicable as an exception in RA 1405.
4. As to petitioners money being the subject matter of litigation, the Court cited Unionbank v. CA,
wherein the Court held that the subject of the action is the matter or thing with respect to which the
controversy has arisen, concerning which the wrong has been done, and this ordinarily is the
property or the contract and its subject matter, or the thing in dispute. In essence, when the money
deposited is the thing in dispute, it is the subject matter of litigation. In this case, since there was a
need to track the whereabouts of the money illegally acquired by Pres. Estrada, there was a need to
examine accounts to which the money were alleged to have been transferred. Petitioners accounts
are thus part of the subject matter of litigation.
5. As to the illegality of the acquisition of the details of his accounts, petitioner, citing Marquez v.
Desierto, claims that since no plunder case was filed against Pres. Estrada at the time that the
Ombudsman conducted an investigation, the information were acquired illegally.
6. Petitioner attempts to make the exclusionary rule applicable in this case, but nowhere in RA
1405 is a provision that renders inadmissible in evidence any information acquired in an
unlawful examination of bank accounts. Sec. 5 of the law merely provides for a penalty in
cases of violations.
7. Assuming that the exclusionary rule did apply, such cannot be applied in this case. The fruit
of the poisonous tree doctrine presupposes a violation of law. Since there was no violation of
RA 1405, then there would be no poisonous tree in the first place, and the fruit would
therefore, not be poisonous (no reason to apply the doctrine).
8. The examination by the Ombudsman of the accounts was lawful, despite without previously filing
a case with the court, since the issuance of the subpoenas was done 4 months before the Marquez
ruling (which the petitioner relies on to say that there has to be a case filed before the examination).
9. Even if the subpoenas were quashed, the Ombudsman is not barred from requiring production
of the same docs based solely on information obtained by it from sources independent of its
previous inquiry. It was found that the Ombudsman did have information for him to believe that
(1) there are bank accounts with no. 858, (2) that such were with Urban Bank, and (3) that they are
linked with the accounts of Pres. Estrada.

DISPOSITION: WHEREFORE, the petition is DISMISSED. The Sandiganbayan Resolutions dated

February 7 and 12, 2003 and March 11, 2003 are upheld.