QuestionsQuestions (PDIC REGULATORY ISSUANCE NO. 2011-02)
PDIC policy is to safeguard depositing public interests by providing continuing insurance on all insured deposits, and only legitimate deposits of bona fide depositors are entitled to deposit insurance unless excluded under the PDIC Charter and this Regulatory Issuance.
A bona fide depositor is the owner of a deposit as determined by PDIC under Regulatory Issuance No. 2009-003 (beneficial ownership of legitimate deposits) and whose deposit is recorded in the bank’s books.
Deposit refers to the unpaid balance of money or its equivalent received by a bank in the usual course of business for which it gives or is obliged to give credit to deposit accounts, including other obligations PDIC determines as deposit liabilities. It excludes deposit obligations payable at the office of the bank located outside the Philippines, subject to an election (with PDIC Board approval) for banks incorporated in the Philippines that maintain branches abroad.
It refers to a representative of money such as cleared personal checks, manager’s or cashier’s checks, and money orders.
When no Money or Equivalent was received by the bank for such account or transaction.
When it is simulated or feigned, or is not a genuine deposit account/transaction—for example, where money is made to appear as if received by the bank, or the name of the depositor does not appear in the bank’s records.
When the bank and/or depositor knowingly employ means calculated to deceive, including breaches of legal/equitable duty or trust/confidence resulting in damage, or undue and unconscientious advantage—e.g., a named depositor denies ownership of the deposit.
Excluded are investment products such as bonds and securities, trust accounts, and similar instruments not falling under the definition of a Deposit. Features indicating an investment include no debtor-creditor relationship; trustee-trustor or agent-principal relationship; principal amount not protected; amount not withdrawable on demand; and analogous features.
PDIC must determine in consultation with the BSP that such accounts/transactions constitute and/or emanate from unsafe/unsound practice, after due notice and hearing, and after issuance and Publication of the Directive to Cease and Desist (DCD).
It prohibits, among others, a bank and/or its directors, officers, employees or agents from offering, marketing, promoting, or continuing such deposit products/accounts/transactions that constitute and/or emanate from an unsafe/unsound banking practice and from representing to the public that these products/accounts/transactions are insured by PDIC.
A DCD is effective upon Publication and remains effective notwithstanding any request for reconsideration, until dissolved or discharged by PDIC.
They are not covered by deposit insurance if they are renewed, rolled over, converted, or transformed to accounts covered by the DCD, or otherwise remain unsafe/unsound in contemplation of the DCD.
The bank or depositor may file within ten (10) days from receipt of the Board resolution, based on newly-discovered evidence materially affecting the resolution; the request must be verified with affidavits and supporting documents.
Payment is deferred on any deposit subject of freeze order, civil forfeiture proceedings, money laundering case, or other unlawful activity case pending before DOJ/Ombudsman/court. Insurance is paid only upon final judgment effectively holding the deposits do not constitute proceeds of unlawful activity; deposits finally determined to be proceeds are not paid.
The depositor may file within sixty (60) days from receipt of denial a verified request for reconsideration based on newly discovered evidence not submitted when the claim was filed, addressed to PDIC’s Claims Group.
PDIC actions are final and executory and cannot be restrained or set aside except via a Rule 65 petition for certiorari for excess of jurisdiction or grave abuse of discretion amounting to lack/excess of jurisdiction. The petition must be filed within thirty (30) days from notice of denial of the request for reconsideration.
Prisión mayor or a fine of not less than P50,000 but not more than P2,000,000, or both, at the court’s discretion, under Section 21(f) of the PDIC Charter, without prejudice to administrative fines under Section 21(g).