FIFTEENTH CONGRESS )
REPUBLIC OF THE PHILIPPINES )
FIRST REGULAR SESSION )

HOUSE OF REPRESENTATIVES

Introduced by Honorable Rufus B. Rodriguez and
Honorable Maximo B. Rodriguez, Jr.

House Bill No,, 2730

EXPLANATORY NOTE

Batas Pambansa Big. 22 otherwise known as “An Act Penalizing the
Making or Drawing and Issuance of a Check Without Sufficient Funds or
Credit,” was passed to curb the issuance of bouncing checks. However,
despite the passage of the said law, bouncing checks continue to proliferate in
the market. What is worse, bouncing checks were likewise used by persons
engaged in pyramid scams as payments for the recruited investors either as a
retum of their investments or commissions for recruiting other investors. Our
people have been defrauded by different pyramid scams which involved billions
of pesos such as the Multitel of Rose Baladjay in 2002, the SMFund,
Franeswiss and PIPC in 2007, the Royal Manchester Five in 2008 and the most
recent, the Legacy Group of Companies.

The victims of the pyramid scams had difficulty in filing cases for
bouncing checks because they did not know who were the signatories of the
checks. The drawee banks, on the other hand, would not divulge the
signatories because of the bank secrecy law. This bill seeks to address this
problem by allowing the drawee banks to divulge the signatories to the
bouncing checks even if the cases are not yet filed in court.

In view of the foregoing, the passage of this bill is eamestly sought.

RUFUS B. RODRIGUEZ

MAXIMO B. RODRIGUEZ, JR.


FIFTEENTH CONGRESS )
REPUBLIC OF THE PHILIPPINES )
FIRST REGULAR SESSION )

HOUSE OF REPRESENTATIVES

Introduced by Honorable Rufus B. Rodriguez and
Honorable Maximo B. Rodriguez, Jr.

House Bill No. 2730

AN ACT
AMENDING REPUBLIC ACT NO. 1405, AS AMENDED, ALSO KNOWN AS
THE BANK SECRECY LAW BY REMOVING FROM ITS COVERAGE
DEPOSITORS WHO ISSUE BOUNCING CHECKS

Section 1. Declaration of Policy. — \t is the declared policy of the state

protect its people and economy from the proliferation or worthless or bouncing
checks.

Section 2._Amendment- Section 2 of Republic Act No.1405, as
amended, an Act Prohibiting Disclosure of or on Inquiry Into, Deposits with any

Banking Institution and Providing Penalty Therefore, is hereby further amended
to read as follows:

“Sec. 2. All deposits of whatever nature with banks or
banking institutions in the Philippines including investments in
bonds issued by the Government of the Philippines, its political
subdivisions and its instrumentalities, are hereby considered as
of an absolutely confidential nature and may not be examined,
inquired or looked into by any person, government official,
bureau or office, except when the examination is made in the
course of a special or general examination of a bank and is
specifically authorized by the Monetary Board after being
satisfied that there is reasonable ground to believe that a bank
fraud or serious irregularity has been or is being committed and
that it is necessary to look into the deposit to establish such
fraud or irregularity, or when the examination is made by an
independent auditor hired by the bank to conduct its regular
audit provided that the examination is for audit purposes only
and the results thereof shall be for the exclusive use of the bank,
or upon written permission of the depositor, or in cases of
impeachment, or upon order of a competent court in cases of


bribery or dereliction of duty of public officials, OR IN CASE OF
A BOUNCING CHECK WHERE THE DRAWEE BANK SHALL
DIVULGE THE SIGNATORY OR SIGNATORIES THERETO
UPON WRITTEN REQUEST OF THE PAYEE EVEN IF THE
CASE IS NOT YET FILED IN COURT, or in cases where the
money deposited or invested is the subject matter of the
litigation. (As amended by PD No.1792, January 16, 1981).”

Section 3. Repealing Clause. - All laws, orders, issuances, rules and
regulations or parts thereof inconsistent with this Act are hereby repealed or
modified accordingly.

Section 4. Effectivity. - This Act shall take effect fifteen (15) days
after its complete publication in at least two (2) newspapers of general
circulation.

Approved,