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Bank Secrecy: Penalties For Violating The Law

Republic Act No. 1405, known as the Bank Secrecy Law in the Philippines, protects the confidentiality of bank deposits and investments in government bonds. Exceptions to this law allow for disclosure under specific circumstances, such as written permission, court orders, or investigations by the Ombudsman. Violating the law can result in penalties including imprisonment and fines.

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Joana Mae Villarojo
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13 views1 page

Bank Secrecy: Penalties For Violating The Law

Republic Act No. 1405, known as the Bank Secrecy Law in the Philippines, protects the confidentiality of bank deposits and investments in government bonds. Exceptions to this law allow for disclosure under specific circumstances, such as written permission, court orders, or investigations by the Ombudsman. Violating the law can result in penalties including imprisonment and fines.

Uploaded by

Joana Mae Villarojo
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as PDF, TXT or read online on Scribd
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Republic Act No.

1405 or known as “An Act compromise of tax liability or determining a


Prohibiting Disclosure of or Inquiry into Deposits with decedent’s gross estate.
any Banking Institution (“Bank Secrecy Law”) 7.​ The Anti-Money Laundering Council (AMLC)
can examine bank accounts with a court order if
Bank secrecy there is probable cause that the deposits are
●​ means that the details of your bank deposits related to unlawful activity or money laundering.
are kept confidential. 8.​ The AMLC can examine bank accounts without
a court order if there is probable cause that the
The Bank Secrecy Law in the Philippines deposits are related to certain crimes such as
●​ known as Republic Act No. 1405 kidnapping for ransom, violation of the
●​ created to encourage people to deposit their Dangerous Drugs Act, hijacking, destructive
money in banks rather than keeping it at home. arson, murder, and violations of Republic Act
6235 (acts inimical to civil aviation).
What does bank secrecy law covers? 9.​ The Bangko Sentral can examine bank
1.​ Deposits: All types of deposits in banks in the accounts during its periodic or special
Philippines are protected by this law. examination regarding compliance with the
2.​ Investments in Government Bonds: Anti-Money Laundering Law.
Investments in government bonds are also
covered. Penalties for Violating the Law
Note: If someone breaks this law, they can face:
●​ No one can just go to your bank and ask for ●​ Up to five years in prison.
your bank balance. ●​ A fine of up to ₱20,000.
●​ The law prevents anyone from disclosing ●​ Or both
information about your funds or property held
by the bank, with some specific exceptions.

Exceptions to the Law


Bank information can only be shared in the following
situations:
1.​ If you give written permission.
2.​ In cases of impeachment (misconduct).
3.​ If a court orders it in cases of bribery or
dereliction of duty of public officials (failure to
perform the responsibilities of their position).
4.​ If a court orders it when the money deposited or
invested is the subject of a court case.
5.​ If the Ombudsman issues a subpoena(order a
person to appear in court) for an investigation,
provided there is already a case pending in
court, the account is clearly identified, and the
inspection is limited to the case. The bank
personnel and the depositor must be notified
and present during the inspection.
6.​ The Bureau of Internal Revenue (BIR) can
inquire into bank deposits when applying for a

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