Sandiganbayan orders bank to pay PH gov’t P96M, $5.4M in Marcos ill-gotten wealth

Ferdinand

Ferdinand “Bongbong” Marcos Jr. (2nd L), former senator and son of the late dictator Ferdinand Marcos, his sister Sen. Imee (2nd R) and their mother, former Philippine first lady Imelda Marcos (R), listen to the national anthem during a wreath-laying ceremony at a monument of the late dictator during celebrations to mark his 100th birthday in Batac, Ilocos Norte on Sept. 10, 2017.

MANILA — After 24 years, the Philippines’ anti-graft court has ordered a bank that was initially suspected to be owned by the Marcoses, to pay the government around P96 million and $5.4 million in ill-gotten wealth. 

In a decision promulgated Sept. 24, the Sandiganbayan Second Division required Traders Royal Bank (TRB, now Royal Traders Holding Co., Inc.) to pay the face value of peso-denominated bank certificates amounting to P30 million and P65.98 million issued in 1974, and 1975 to 1978, respectively.

The bank is also ordered to pay another set of bank certificates, this time amounting to $5.435 million, issued from 1975 to 1979. 

The bank certificates were recovered from the Marcoses when they landed in Hawaii in 1986, following dictator Ferdinand Marcos’ ouster through the People Power revolution. They were held by the US government and became the subject of an interpleader case to determine who were their rightful owners.


When Marcos died in 1989, his wife Imelda entered into an agreement with the Philippine government that she would assign to it the Marcoses’ interest over the merchandise seized by US authorities, in exchange for dropping of legal actions against them.

A Hawaii District court, in December 1992, honored the settlement and awarded the merchandise seized from the Marcoses to the Philippine government.

But when the Presidential Commission on Good Government (PCGG) tried to encash the bank certificates from TRB in 1993, the bank refused.

The PCGG filed a case against TRB in 1997.

SANDIGANBAYAN RULING

In ordering TRB to pay the Philippine government the face value of the bank certificates with a 12% yearly interest from February 1993 until fully paid, the Sandiganbayan relied on a procedural rule recognizing the validity of foreign judgments in the Philippines.

Section 48 of Rule 39 of the Rules of Court allows the enforcement of judgments rendered by foreign courts in the Philippines subject to certain exceptions.

The anti-graft court rejected TRB’s claim that the bank certificates PCGG presented have already been paid to a former president of the bank, noting that TRB’s sole witness, lawyer Hector Rivera, could not produce a single surrendered certificate of deposit.

“The bank certificates which were brought by the Marcoses to Hawaii, which are included as part of the Res in the interpleader case decided by the US District Court of Hawaii and now sought to be enforced for payment to plaintiff [Philippine government], have not been surrendered to TRB. This negates TRB’s claim that payments have been made,” the court said in the ruling penned by Associate Justice Oscar Herrera, Jr.

Associate Justices Michael Frederick Musngi and Bayani Jacinto concurred.

MARCOS OWNERSHIP OF BANK NOT PROVEN

However, the anti-graft court denied the Philippine government’s plea for the reconveyance to it of 278,488 shares of stock of TRB which were issued in the name of the Royal Bank of Canada (RBC).

The Philippine government had claimed Marcos owned these shares through his close friend and classmate Ambassador Roberto Benedicto.

In 1978, RBC supposedly sold these shares to Banque de Paris but an ensuing error supposedly exposed the true owners of the shares — the stock and transfer book reflected that the shares were transferred to Benedicto’s front corporations Far East Manager and Investors, Inc. (FEMII) and Universal Equity Corp. (UEC). These entries were subsequently canceled.

For the Sandiganbayan, these allegations were not proven.

“The shares are still under the name of Royal Bank of Canada (RBC) which is not a party to this case. Also, no sufficient evidence was presented in this case to prove that the shares belong to former President Marcos and part of his ill-gotten wealth,” the court said.

The Sandiganbayan also absolved Bank of Commerce, which acquired TRB/Royal Traders Holding Co., Inc., because the purchase and sale agreement excluded the claim of the Philippine government against TRB as a banking institution.

Under the purchase and sale agreement, TRB ceased banking operations by July 2002 because these were carried out by the Bank of Commerce moving forward.

The Philippines last week marked the 49th anniversary of Marcos’ declaration of Martial Law all over the country, which was marred by human rights abuses and massive corruption.

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