THE Court of Appeals has upheld the decision of the Makati Regional Trial Court dismissing money laundering charges against three officials of the Rizal Commercial Banking Corporation in relation to the $81M Bangladesh Bank heist.
The Makati RTC had granted the demurrer to evidence of former RCBC Treasurer and Executive Vice President Raul Victor Tan, National Sales Director for Retail Banking Ismael Reyes, and Regional Sales Director for Retail Banking Brigitte Capiña and dismissed the charges against them in 2019.
They were among those earlier charged with failing to perform acts that allegedly facilitated the laundering of $81 million from the hacking of Bangladesh Bank’s system in 2016, according to an article published on Abogado.ph.
State prosecutors challenged the dismissal of the charges against them before the appellate court.
But the CA Sixteenth Division upheld the Makati RTC and said Judge Ma. Caridad Villamor-Yee did not abuse her discretion in issuing the ruling.
In a July 14 decision, the CA said the prosecution failed to present sufficient evidence to prove money laundering.
The CA said the three RCBC officials had not known that the money represented proceeds of an unlawful activity.
There was also no showing that they were notified of the particulars of the inward remittances or that there were lapses in the opening of the beneficiary accounts. By the time they were notified about Bangladesh Bank’s request for the recall of the funds, the amounts were already withdrawn and transferred to different accounts, it said.
The CA also said the RCBC officials could not be held liable for supposedly failing to conduct enhanced due diligence, which led to the money laundering.
The CA noted that based on the prosecution evidence, the amounts from Bangladesh credited to the four RCBC beneficiary accounts were already withdrawn and transferred to different accounts at a time when the three RCBC officials had no knowledge yet of the unlawful activity associated with the remittances.
They had also not known of Bangladesh Bank’s request for the recall of funds.
“Any conduct of the Enhanced Due Diligence after the amounts were already withdrawn would be rendered futile since the said conduct is intended for a covered institution, such as RCBC, to control and reduce the risk associated with money laundering and terrorist financing,” it said.
It also said the three RCBC officials were not required to conduct the enhanced due diligence prior to such knowledge.
In the first place, the prosecution failed to show that the three officials were the ones specifically responsible for conducting this kind of due diligence, it said.
But even if they were, it said there is no evidence that they received information that raised doubt about the accuracy of the information provided by the beneficiaries, or would justify re-classifying the four beneficiary accounts from low to high risk.
The amounts were credited in the beneficiary accounts via Straight Through Process after the transactions passed the validation criteria in RCBC’s Pre-Validation System, it noted.
The CA also said that even if enhanced due diligence was conducted and the RCBC officials were suspicious about the transactions, RCBC had no authority to freeze the accounts.
It said only the Anti-Money Laundering Council could file a petition to freeze the account, and without any court order for such, the account holders could still withdraw the amounts even after the conduct of enhanced due diligence.
