Republic of the Philippines
HOUSE OF REPRESENTATIVES
Quezon City, Metro Manila

FIFTEENTH CONGRESS
First Regular Session

QS 62
House Bill No. =

Introduced by Honorable Roilo Golez

EXPLANATORY NOTE

This bill which is commonly called the proposed "RICO LAW" is primarily aimed at preventing the
use of money and power by organized crime syndicates to subvert and corrupt legitimate businesses by
facilitating the prosecution of and imposing stifer penalties for criminal offenders.

This bill will greatly help our law enforcement agencies, most importantly in the Judiciary in curtailing the
activities of organized crime syndicates and prosecute them for their illegal activities. We have been a witness to
a lot of arrests and filing of charges against alleged kidnap-for-ransom groups as well as gambling and drug
lords only to end up being acquitted for lack of evidences to merit their prosecution.

Under this proposed bill, the following are considered prohibited activities:

a) Knowingly participating, eit her directly or indirectly, with or in an enterprise, conducting a
pattern of racketeering activity;

b) Receiving any money or property derived directly or indirectly, from a pattern of racketeering
activity;

¢) Using or investing, directly or indirectly, any part of the money or property received or derived,
directly or indirectly, from a pattem of racketeering activity in any interest in or in establishment
‘or operation of any business;

d) Acquiring or maintaining through a pattern of racketeering activity, directly or indirectly, any
interest in or control or any business enterprise; and

e) _Conspiring in the conduct of any unlawful acts provided herein.
Moreover, the bill also provides for the following features:

a) Covering a wide range of racketeering activities which will include kidnapping; murder; arson;
robbery; illegal possession of firearms or explosives; bribery; illegal gambling; importation,


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manufacture, sale, delivery, distribution and transportation of prohibited drugs and maintenance
of a drug den; and other illegal activities;

Requiring at least two (2) predicate acts of racketeering activity, within ten (10) years before
and afler the effectivity of the Act, to establish a "pattern";

Imposing maximum penalty of life imprisonment or death and a fine of not less than One
Hundred Thousand Pesos (P100,000.00) nor more than One Million Pesos (P1,000,000.00) to
those found guilty of a racketeering activity; and

Forfeiture and sequestration by the government of any property by any person convicted of any
prohibited activities.

This representation strongly believes that the passage of this RICO bill is the culmination of
Congressional investigations on illegal gambling and other illegal actives since it vill empower and
authorize the government to go after the illegally acquired asses of people involved in illegal activities
and transactions

Considering the importance of this measure, ! eamestly urged for the early approval this bill.

ROILO GOLEZ



Republic of the Philippines
HOUSE OF REPRESENTATIVES
Quezon City, Metro Manila

FIFTEENTH CONGRESS
First Regular Session

House Bill No.

Introduced by Honorable Roilo Golez

AN ACT
CURTAILING THE ILLEGAL ACTIVITIES OF RACKETEERS AND POWERFUL SYNDICATES IN THE
PHILIPPINES

Be it enacted by the Senate and House of Representatives of the Philippines in Congress assembled:

SECTION 1. Title of the Act. - This Act shall also be known as the "Racketeer-Influenced and
Corrupt Organizations (RICO) Act of 2010".

SEC. 2. Declaration of Policy. - It is the policy of the State to promote and maintain a sound
economy anchored on legitimate business enterprises and transactions and fueled by honest capital
derived from legitimate and lawful sources and activities. It is likewise the policy of the State to curb
organized and sophisticated crimes and the laundering of the proceeds of these crimes into legitimate
business and activities by depriving the criminals the opportunity to enjoy the proceeds of their wrong
doings.

SEC. 3. Liberal Construction. - The provisions of this Act shall be liberally construed to effectuate
the policy declared under this Act. However, the constitutional rights of any person accused under this Act
shall not be impaired.

SEC. 4. Definitions.- For purposes of this Act, the words and phrases used herein shall, unless the
context indicated otherwise, mean and understood to mean as follows:

a) “Person” _is any individual, association, partnership, corporation, entity or any group
of individuals, associations, corporations or entities.

b) "Enterprise" is any legitimate business or establishment formed as corporation,
partnership, single proprietorship, formal or informal association, or as a group of individuals whether
possessed of juridical personality or not.

©) "Racketeering activity” whether by an organized conspiracy or by an individual, is any
attempt or act involving all of the following crimes of kidnapping, for the purpose of


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ransom; murder for money; arson; robbery; illegal possession of firearms, and explosives
for purposes of gunrunning, whether syndicated or not; bribery; other graft and corrupt
practices; syndicated illegal gambling; organized syndicated carnapping; piracy; hijacking;
illegal logging; illegal mining; white slavery; illegal recruitment; smuggling; illegal fishing;
fencing, as a result of theft or robbery; importation, manufacture, sale, administration,
delivery, distribution and transportation of prohibited drugs and maintenance of a drug den;
large-scale swindling; syndicated film piracy; electronic and computer software piracy
andior fraud; counterfeiting; violation of intellectual property rights; monopolies and
combination in restraint of trade; syndicated land grabbing and falsification of land titles,
whether private or public land; securities fraud, bank frauds; and sexual exploitation of
children as defined under existing and similar general and special laws and other acts of
similar nature where the objective is to raise money or generate funds.

ttern” of racketeering activity requires at least two (2) predicate acts of racketeering
activity, one of which occurred after the effectivity of this Act and the other occurring either
within ten (10) years before the one occurring after the effectivity of this Act or within ten
years after the one occurring after the effectivity of this Act.

“Racketeering investigator” is an atlomey or investigator so designated by the Secretary
of Justice or the Solicitor General to serve as racketeer document custodian and charged
with the duty of enforcing or carrying into effect this Act.

“Dummy’ is a person secretly acting for another who is apparently representing his own
interests; tool of another.

"Sequestration" means taking into custody or placing under the States control or
possession any asset, fund, or other property, as well as relevant records, papers and
documents in order to prevent their concealment, destruction, impairment, or dissipation
pending the determination whether the said asset, fun or propery is il-gotten or a result of
any illegal activities punished under this Act.

‘SEC. 5. Prohibited Activities. - It shall be unlawful for any person

a) Knowingly participate, either directly or indirectly with or in an enterprise
conducting a pattern of racketeering activity;

b) Received any money or property derived directly or indirectly, from a pattern of
racketeering activity, or act as dummy of any person in order to hide or conceal
Money or property acquired through racketeering activities as defined herein;

c) Use or invest directly or indirectly, any part of the money or property received or
derived, directly or indirectly, from a pattern of racketeering activity in any interest
in or the establishment or operation of any business.

d) Acquire or maintain through a pattem of racketeering activi
any interest in or control of any business enterprise.

directly or indirectly


©) —_Conspire in the conduct of any untawul acts provided herein,

SEC. 6. Penalties. - Any person who commits any of the prohibited activities under Section § of this
‘Act shall, upon conviction, be penalized by imprisonment of not less than ten (10) years nor more than
twenty (20) years and if found guilty of a racketeering activity for which the maximum penalty includes life
imprisonment or death, the penalty shall be life imprisonment or death, and a fine of not less than One
Hundred Thousand Pesos (100,000.00) nor more than One Million Pesos (1,000,000.00).

SEC. 7. Forfeiture. - In addition to penalties provided in the
Preceding Section, any person convicted of any prohibited activities provided under Section 6 hereof shall
forfetin favor of the Philippine Government:

1. any interest acquired or maintained through racketeering activity or a pattern of
racketeering activity;

2 any interest in, security of, claim against, or property or contractual right of any
kind affording a source of influence over any enterprises which any person has
established, operated, controlled, conducted, or participated in the conduct of such
unlawful acts; and

3. any property constituting, or derived from any proceeds which the person obtained
directly or indirectly, from racketeering activities.

All rights, tiles and interest in property described in the preceding paragraph shall
be vested in the Philippine Government upon the commission of the act giving rise to forfeiture under this
Section. The manner of disposition thereof shall be in accordance with Section 14 of this Act.

SEC. 8, Jurisdiction. - Any of the regional trial courts of the place where any of the racketeering
activity constituting the pattern of racketeering activity has been committed including those with jurisdiction
‘over heinous crimes, shall have jurisdiction over cases filed under this Act and applications for forfeiture
including petitions for temporary restraining order or injunction under the next succeeding section
fegardless of the location of any property subject to forfeiture or where the person resides or where the
enterprise is located.

SEC. 9. Sequestration. - All known properties of the defendant shall be subjected to sequestration
upon the filing of a criminal complaint against him.

SEC. 10. Temporary Restraining Order. - A Temporary restraining order effective for sixty
(60) days may be issued upon application by the Secretary of the Department of Justice or the Solicitor
General without notice or opportunity for a hearing before, during or after the filing of the information
directing the defendant or any person acting on his behalf to desist from disposing and to preserve the
availabilty of the property for forfeiture, if the Philippine government demonstrates that there is probable
Cause to believe that the property would be subject to forfeiture and that the provision of notice will
jeopardize the availabilty of the property for forfeiture.


SEC. 11 Preliminary Injunction. - Within (60) days after the issuance of a temporary
restraining order, the court shall conduct a hearing with notice to all properties concerned. A writ of
preliminary injunction shall be issued if the court determines that:

a) There is substantial probability that the Philippine government will prevail on the issue of
forfeiture and that failure to issue the writ will result in the property being destroyed,
removed, disposed of or otherwise made available for forfeiture; and

b) The need to preserved the availabilty of the property through the writ outweighs the
hardship on any party against whom itis directed.

SEC.12. Evidence Required. -In the hearing for the prosecution of
cases fled under this Act, the sole testimony of a participant or conspirator, if credible, can be the basis for
conviction of the other defendants: provided That, for purposes of the hearing for the writ of preliminary
injunction, the court shall not be bound by the technical rules on evidence under the rules of court; Provided
further, that the evidence was taken without violating the constitutional rights of the accused.

SEC. 13. Judgement of Forfeiture. - Upon conviction of person under this section, the court
shall enter a judgement of forfeiture of the property in favor of the Philippine government and shall
authorize the Secretary of Justice or the Solicitor General to seize all properties ordered forfeited: Provided,
That the judgement of forfeiture in the original case shall be without prejudice to the right of the government
to initiate further forfeiture proceedings on properties of the accused which may later on be discovered as
part or the proceeds of the commission of the crime of racketeering.

SEC. 14 Disposition of Forfeited Property. -Following the seizure of the property, the
Secretary of Justice or the Solicitor General shall direct the disposition of the property by sale or any other
commercially feasible means pursuant to existing laws, rules and regulations on the sale of government
properties. Any property right or interest not exercisable by or transferable for value to the Philippine
government shall expire and shall not revert to the defendant, nor shall the defendant or any person acting
on his behalf be eligible to purchase forfeited property at any sale held by the Philippine government.

SEC. 15. Restitution of Property to Victims. - The court entering the judgement of conviction
and forfeiture, upon finality of the decision, shall hear petitions by victims of racketeering activity for
restitution of property or compensation. The court may order portions of the proceeds of the sale of forfeited
property deposited with the National Treasury to be paid to the victims.

SEC. 16. Rights of Third Parties. - No party claiming an interest in property subject to
forfeiture may:

)_ Intervene in a trial or appeal of a criminal case involving the forfeiture of such property;
or

b) Commence an action at law or equity nor may any court issue a restraining order or
injunction against the Philippine government concerning the validity of his alleged
interest in the property subject to forfeiture.


However, any person, other than the defendant asserting a legal interest property ordered forfeited
may, within thirty (30) days from publication by the Secretary of Justice or Solicitor General of the
judgement for forfeiture in two (2) national papers of general circulation in the Philippines, petition the court
for a hearing to adjudicate the validity of his alleged interest in the property.

SEC. 17. ‘Substitution of Other Properties. - The court shall order the substitution and/or
forfeiture of any other property of the defendant equivalent to value of any property described in Section 7,
if any of the said properties:

a) Cannot be located upon the exercise of due diligence;

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Has been transferred or sold to a third party who acquired the same in good faith;
c) Has been placed beyond the jurisdiction of the courts;
d) Has been substantially diminished in value; or

e) Has been commingled with other property which cannot be divided without difficulty.

SEC. 18. Civil Remedies. - a) The Secretary of Justice or the Solicitor General may initiate
civil action in any of the regional rial courts of the place where any element of any racketeering activity has
been committed which shall have jurisdiction to prevent or restrain unlawful acts provided under Section 5
hereof, irespective of where the person resides or is found or where the enterprise or property is located
by issuing appropriate orders, including but not limited to:

1) Ordering any person to divest himself of any interest, direct or indirect in any
enterprise;

2) Imposing reasonable restrictions on the future activities or investments of any person
including but not limited to, prohibiting any person from engaging in the same type of
endeavor as the enterprise engaged in; or

3) Ordering the dissolution or reorganization of any enterprise, making provision for the
rights of innocent persons.

A final judgement rendered in favor of the Philippine government in any criminal proceeding shall be an
estoppel for the defendant from denying the essential allegations of the criminal offense in any subsequent
civil proceedings brought by the Philippine government.

b) Any person injured in his person, business or property or his heirs, by reason of prohibited
activities under Section 5 hereof, may sue therefor in the appropriate regional trial court as provided in the
Preceding paragraph and may be entitled to recover threefold the damages he sustains and the cost of the
Suit, including a reasonably attorneys fees against all persons found guilty under this Act


SEC. 19 Expedited Action. - In any civil action instituted under the preceding Section, the
regional trial court shall expeditiously try and hear the case, giving it preference to the same over all other
civil cases,

SEC. 20. ‘Subpoena Duces Tecum. - a) Whenever the Secretary of Justice of the Solicitor
General has reason to believe that any person or enterprise may be in possession or control of any
documentary materials relevant to a racketeering investigation, he may, prior to the institution of a criminal
or civil proceedings, apply with the court for the issuance of a subpoena duces tecum thereon, requiring
‘such person to produce such materials for examination.

b) Any person who has duly served with subpoena duces fecum shall make available for
inspection, copying or reproduction to the custodian designated therein at any place agreed upon and shall
certify under oath that the copies are true reproductions of the original, which certified copies shall be
admissible in court as originals.

c) While in the possession of the custodian, no material so reproduced shall be available for
examination, without the consent of the person who produced such material, by any individual other than
the Secretary of Justice or Solicitor General.

SEC. 21 Statute of Limitations. - One of the predicate acts of racketeering must have been
committed within ten (10) years of the date of the information, otherwise violations of this Act shall be
deemed to have prescribe.

SEC. 22. Consolidation of Cases. - The trial for criminal liability for each predicate act of
racketeering activity shall be consolidated with the court hearing the RICO case.

SEC.23. Repealing Clause. - All laws, decrees, orders, rules and regulations or parts
thereof inconsistent with this Act are hereby amended, repealed or modified accordingly.

SEC. 24, Separabilty Clause. - If, for any reason or reasons, any part or provision of this
Code shall be held unconstitutional or invalid, other parts or provisions hereof which are not affected
thereby shall continue to be in full force and effect.

SEC. 25. Effectvity. - This Act shall take effect fiteen (15) days after its complete
Publication in at least two (2) national newspapers of general circulation

Approved,