(Contributed photo)
MANILA – The Supreme Court (SC) has upheld the decision of the Office of the Ombudsman clearing officials of the Monetary Board (MB) in graft charges filed by officials of the defunct Banco Filipino Savings and Mortgage Bank.
The ruling of the SC First Division affirmed the Court of Appeals (CA) decision, which denied the suit questioning the ruling of the Ombudsman.
The MB faced graft charges arising from its denial of Banco Filipino’s application for PHP25 billion in emergency loans and its order for the bank’s closure in 2011.
The SC noted that the Ombudsman’s ruling had become final after the petitioners elevated the case to the CA, instead of the high court.
“Clearly, petitioners have lost their right to assail the Ombudsman’s findings of absence of probable cause. The CA, therefore, did not commit any reversible error in denying their petition for availing of the wrong remedy,” the SC stated in its decision published online October 20.
In MB’s negotiations with bank officials for the loan, there was a pre-condition of a withdrawal of all pending cases against the regulatory body and its officials in connection with the Central Bank of the Philippines (now Bangko Sentral ng Pilipinas or BSP) order to cease operations in 1985.
The bank refused to agree to the conditions and in 2011, was placed under receivership of the Philippine Deposit Insurance Corp. and liquidation after determining it cannot continue its business without probable losses to its depositors and creditors.
In 2012, the Department of Justice (DOJ) found no manifest and evident bad faith nor violation of pertinent banking laws and said the respondents did not cause undue prejudice nor committed acts which constitute abuse of authority when it did not release the financial assistance sought by the bank.
The Ombudsman approved the DOJ recommendation in 2014 and said that the MB resolution was issued only after an investigation and assessment of the actual state and condition of Banco Filipino.
The SC affirmed the second amended decision issued by the CA in November 2019, giving BSP the go-signal to bid out, sell, and dispose of the assets of Banco Filipino.
The first closure in 1985 spawned multiple suits between the bank and MB, including a case decided by the SC in 1991 that ruled the bank’s closure was illegal.
In 1993, the MB, under the newly formed BSP, allowed the bank to resume business until it ran into financial troubles anew. (PNA)
