G.R. No. 201069. June 16, 2021
BANGKO SENTRAL NG PILIPINAS, PETITIONER, VS. OFFICE OF THE OMBUDSMAN AND BENJAMIN M. JAMORABO, RESPONDENTS. D E C I S I O N
GAERLAN, J.:
under Rule 65 of the Rules of Court assails the following issuances of
the Office of the Ombudsman in Case No. OMB-C-C-09-0465-I: 1) February
9, 2011 Resolution dismissing the complaint filed by the Bangko Sentral
ng Pilipinas (BSP) against private respondent Benjamin M. Jamorabo
(Jamorabo) for lack of probable cause;[2] and 2) July 28, 2011 Order denying the motion for reconsideration filed by the BSP.[3]
The Facts
Petitioner BSP is the constitutionally mandated[4] central monetary authority of the Philippines, created through Republic Act (R.A.) No. 7653.[5]Jamorabo
was a former Bank Officer I in the BSP’s Supervision and Examination
Sector (SES). As earlier mentioned, BSP filed a complaint dated August
11, 2009,[6] against Jamorabo
before the Office of the Ombudsman for violation of Section 27(d) of
R.A. No. 7653 and BSP Office Order No. 423, series of 2002, for
obtaining a loan with the Rural Bank of Kiamba, Sarangani, Inc. (RBKSI)
while he was conducting the regular examination of said bank from July 6
to 22, 2006. The complaint alleged the following:
3. The investigation of the OSI revealed that, during the
RBKSI examination, specifically on 17 July 2006, Mr. Jamorabo took out
an unsecured loan in the amount of P200,000 with RBKSI. He promised
RBKSI’s president Cornelio T. Falgui [Falgui], and manager, William C.
Nero [Nero] (Affidavit, attached as Annex _____ together with all the
supporting documents), that he would settle the loan prior to the next
BSP general examination of RBKSI, which is conducted every two-year
interval, so that the loan would no longer be in RBKSFs books. According
to Mr. Nero, Mr. Falgui had wanted to turn down the application, but
could not do so because he feared he might offend Mr. Jamorabo.4. For a loan of such amount, RBKSI would normally require from the
borrower a collateral, presentation of documentary proof of income, and
credit investigation. Mr. Jamorabo’s loan, however, did not undergo the
ordinary processes and was approved without him offering a collateral.
He convinced Mr. Nero that he would just issue post-dated checks payable
to RBKSI.5. Mr. Jamorabo issued a total of eight personal post-dated checks, six
in the amount of P30,000 and two in blank, drawable against his checking
account maintained at the Philippine National Bank (“PNB”)-Central Bank
(“CB”) Service Unit-Manila, representing eight payments for his
quarterly amortizations of P30,000. The first amortization was due 17
October 2006.6. It must be emphasized that in the loan documents, Mr. Jamorabo did
not indicate his name as the principal borrower but the name of his
wife, Marites B. Jamorabo (Marites). He made himself as her co-maker.
He, however, was the one who filled out and signed the loan documents,
including signing in the name of his wife. Ms. Marites B. Jamorabo
neither went to the bank nor signed any loan documents.7. On 18 July 2006, Mr. Nero deposited, through inter-bank transaction
at PNB-Santiago Boulevard Branch, General Santos City, the net proceeds
of the loan in the amount of P198,000 into the savings account of Mr.
Jamorabo maintained at PNB-CB Service Unit-Manila.8. When the loan became due, he was able to pay only the first and
second amortizations and only after his first check had already
“bounced” for the reason that it was drawn against insufficient funds
(“DAIF”). His first and second amortizations were due on 17 October 2006
and 17 January 2007, respectively, but he remitted his loan payment
only on 9 February 2007 to RBKSI’s depositary bank (“Equitable-PCI
Bank”) via inter-bank deposit at Equitable-PCI Bank in Bacoor, Cavite,
and after requesting RBKSI not to deposit his second check.9. When his third amortization became due, Mr. Jamorabo began calling
RBKSI’s cashier, Aurora Cagas, advising her not to deposit his check
dated 17 April 2007 representing payment for his third amortization. His
communication with the bank, however, suddenly stopped even after his
check dated 17 July 2007 representing payment for his fourth
amortization became due.10. In September 2007, Mr. Nero decided to deposit in RBKSI’s depositary
bank Mr. Jamorabo’s check dated 17 April 2007 representing payment for
his third amortization. The check was dishonored for the reason that
Jamorabo’s checking account was already closed as of 17 September 2007.
Mr. Nero sent a text message to Mr. Jamorabo urging him to pay his loan
but Mr. Nero did not receive any reply. Mr. Nero also tried calling Mr.
Jamorabo’s cellular phone but the same could no longer be contacted.
Considering that Mr. Jamorabo’s checking account was already closed, Mr.
Nero decided not to deposit the rest of Mr. Jamorabo’s checks. Mr.
Falgui thought of suing Mr. Jamorabo, but he died in July 2008 without a
case having been filed.11. Sometime in December 2008, Mr. Nero received a cell phone call from
Mr. Jamorabo using a different number. Mr. Jamorabo informed the manager
that he would settle his loan account with RBKSI and instructed the
Manager to text to him the outstanding balance of his loan. Mr. Jamorabo
also reasoned out that he failed to make good his checks because he was
sent for further studies by the BSP to Malaysia.12. Despite the promise, Mr. Jamorabo did not pay his loan.
13. On 14 to 29 April 2009, the Anti-Money Laundering Specialist Group,
SES, conducted a regular examination of RBKSI. Taking this as an
opportunity, Mr. Nero divulged Mr. Jamorabo’s loan to the
examiner-in-charge. The examiner-in-charge informed the manager that Mr.
Jamorabo had just retired from the BSP and advised the manager to write
a letter to Mr. Willie Asto, Managing Director of Financial Accounting
Department of the BSP, requesting assistance in deducting from Mr.
Jamorabo’s retirement benefits the outstanding balance of his loan
amounting to P210,829.49 as of 23 April 2009.14. The loan is undeniably Mr. Jamorabo’s loan even if he deceptively
misrepresented that the principal borrower was his wife. As positively
disclosed by Mr. Nero, there was no Ms. Marites Jamorabo who appeared in
the bank and signed the loan documents. Be that as it may, having
signed as a co-maker, in the eyes of the law, he is also considered a
principal borrower being jointly and severally liable for payment of the
loan.15. Thus, when he took out the loan on 17 July 2006, during which period
the RBKSI was under his examination, he clearly committed a violation
of Section 27(d) of R.A. No. 7653. x x x[7]
The complaint was docketed as a criminal case[8]
and preliminary investigation was conducted thereon. On November 17,
2009, the Ombudsman ordered Jamorabo to submit his counter-affidavit.[9]
On December 10, 2009, Jamorabo complied with the anti-graft agency’s
order by submitting his own affidavit together with the affidavits of
his witnesses, his wife Marites, and his sister-in-law, Honeyve
Montecalvo.[10]
In dismissing the complaint, the Ombudsman ruled that a violation of
R.A. No. 7653, Section 27(d) and BSP Office Order No. 423, series of
2002 does not entail criminal liability; hence Jamorabo can only be held
administratively liable. However, since Jamorabo had already retired
from government service on December 31, 2008,[11] before the complaint was filed, he cannot be sanctioned anymore.[12]
The anti-graft agency also ruled that Jamorabo cannot be held liable
for violating Section 3(e) of R.A. No. 3019 because the BSP failed to
prove any injury, loss or damage to the government caused by Jamorabo’s
acts, since he was able to pay the loan in full.[13]
Finally, the Ombudsman held that the officers of RBKSI were also at
fault for approving Jamorabo’s loan application. Given the high
standards of diligence expected from banks, RBKSI’s officers should have
exercised extreme caution in processing Jamorabo’s loan application.
Furthermore, they reported the incident only in 2009; almost three years
after Jamorabo availed of the loan.[14]
but the Ombudsman rendered the assailed July 28, 2011 order affirming
the dismissal of the complaint. The Ombudsman maintained that Jamorabo
can no longer be administratively sanctioned because the case against
him was filed after he had retired from government service and that full payment of the loan in question negated the existence of undue injury.
During the pendency of the case, it was discovered that Jamorabo had
migrated to Canada with his family on April 14, 2010, with no intention
of returning to the Philippines;[19] hence, the Court dispensed with his comment.[20]
On April 24, 2013, the BSP filed its reply. The issues having been
joined, the Court now resolves the following questions posed by the
pleadings:
27(d)?
present complaint was filed after his retirement from government
service?
The petition is partially meritorious. While this Court respects the
wide latitude given to the Office of the Ombudsman in the exercise of
its investigatory and prosecutorial powers,[21]
it is likewise this Court’s power and duty to set aside the rulings of
the Ombudsman if such rulings are tainted with grave abuse of
discretion.[22]
and criminal liability.
and a proviso. The first part of the provision states the general rule:
BSP personnel are not allowed to “[borrow] from any institution
subject to supervision or examination by the Bangko Sentral x x x unless
said borrowings are adequately secured, fully disclosed to the Monetary
Board, and x x x subject[ed] to such further rules and regulations as
the Monetary Board may prescribe.” The second part, or the proviso, further qualifies this rule with a second, more specific prohibition: “That
personnel of the supervising and examining departments are prohibited
from borrowing from a bank under their supervision or examination.”
This qualification to the general rule is specifically targeted at the
BSP personnel who do the actual work of supervising and examining banks,
and who are absolutely prohibited from borrowing from banks under their
supervision or examination.
and examination personnel was removed by R.A. No. 11211,[23] which amended Section 27(d) as follows:
SEC. 27. Prohibitions. — In addition to the
prohibitions found in Republic Act Nos. 3019 and 6713, personnel of the
Bangko Sentral are hereby prohibited from:x x x x
(d) borrowing from any institution subject to supervision or examination
by the Bangko Sentral unless said borrowing is transacted on an arm’s
length basis, fully disclosed to the Monetary Board, and shall be
subject to such rules and regulations as the Monetary Board may
prescribe.
Nevertheless, the provision, as amended, maintains the general rule in
R.A. No. 7653: BSP personnel cannot borrow loans from entities that are
subject to the BSP’s supervision or examination, unless the conditions
set forth in the provision are met.
To penalize violations thereof, R.A. No. 7653 contains a general penal
clause, which is essentially retained in R.A. No. 11211, viz.:
|
Original text
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As amended
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Section 36. Proceedings Upon Violation of This Act and Other Banking
Laws, Rules, Regulations, Orders or Instructions. – Whenever a bank or quasi-bank, or whenever any person or entity willfully violates this Act or other pertinent banking laws being enforced or implemented by the Bangko Sentral or any order, instruction, rule or regulation issued by the Monetary Board, the person or persons responsible for such violation shall unless otherwise provided in this Act be punished by a fine of not less than Fifty thousand pesos (P50,000.00) nor more than Two hundred thousand pesos (P200,000.00) or by imprisonment of not less than two (2) years nor more than ten (10) years, or both, at the discretion of the court. |
SEC. 36. Proceedings upon Violation of This Act and Other Banking Laws,
Rules, Regulations, Orders or Instructions. – Whenever a bank, quasi-bank, including their subsidiaries and affiliates engaged in allied activities or other entity which under this Act or special laws is subject to Bangko Sentral supervision or whenever anv person or entity willfully violates this Act or other pertinent banking laws being enforced or implemented by the Bangko Sentral or any order, instruction, rule or regulation issued by the Monetary Board, the person or persons responsible for such violation shall unless otherwise provided in this Act be punished by a fine of not less than Fifty thousand pesos (P50,000.00) nor more than Two million pesos (P2,000,000.00) or by imprisonment of not less than two (2) years nor more than ten (10) years, or both, at the discretion of the court. |
personnel who borrow from institutions under BSP supervision or
examination without complying with the requisite former provision shall
be penalized by a fine or imprisonment, or both, at the discretion of
the court. Thus, the Ombudsman committed a glaring mistake amounting to
grave abuse of discretion when it ruled that a violation of R.A. No.
7653, Section 27(d) entails administrative liability only. A cursory
reading of the statute in its entirety clearly shows that Section 27(d) is a penal provision, a violation of which gives rise to criminal liability,[24] apart from the administrative liability imposed by BSP Office Orders No. 423,[25] series of 2002; and No. 860, series of 2007;[26] and the Uniform Rules on Administrative Cases in the Civil Service.[27]
Settled is the rule that wrongful acts or omissions of public officers
may give rise to civil, criminal, and administrative liability, each of
which is separate and distinct from the other.[28]
In the case at bar, there is no dispute that: 1) Jamorabo was one of the
BSP personnel assigned to conduct the examination of RBKSI from July 5
to 22, 2006; and 2) Jamorabo, as co-maker[29] for his wife, took out a 200,000-peso loan from RBKSI during the examination period thereof.[30]
However, in view of our finding that Section 27(d) is a penal
provision, the repeal by R.A. No. 11211 of the absolute prohibition on
borrowings by BSP supervision and examination personnel should be given
retroactive effect in favor of Jamorabo, pursuant to Article 22 of the
Revised Penal Code.[31] Consequently, Jamorabo’s loan with RBKSI can no longer be considered a per se violation of Section 27(d); rather, its compliance with the requisites of Section 27(d), as amended, must be ascertained.
amended.
As earlier mentioned, to be permissible under Section 27(d), loans taken
out by BSP personnel with institutions undergoing BSP examination must
now satisfy three requisites: 1) conduct of the transaction on arm’s
length basis; 2) full disclosure to the Monetary Board; and 3)
compliance with rules and regulations prescribed by the Monetary Board.
Jamorabo’s transaction with RBKSI does not meet any of these requisites.
parties, however closely related they may be, conducted as if the
parties were strangers, so that no conflict of interest arises;”[32] one made “in
good faith in the ordinary course of business by parties with
independent interests…. The standard under which unrelated parties,
each acting in his or her own best interest, would carry out a
particular transaction;”[33] or “dealings
between two parties who are not related or not on close terms and who
are presumed to have roughly equal bargaining power; not involving a
confidential relationship.”[34] The principle is closely related to the concept of undue influence, viz.:
The notion of dealings at arm’s length featured in the
somewhat related doctrine of “undue influence” that was developed in the
courts of equity. A description of this doctrine is given by Lord
Penzance in Parfitt v. Lawless where he says:In equity persons standing in certain relations to one
another-such as parent and child, man and wife, doctor and patient,
attorney and client, confessor and penitent, guardian and ward-are
subject to certain presumptions when transactions between them are
brought in question; and if a gift or contract made in favour of him who
holds the position of influence is impeached by him who is subject to
that influence, the Courts of equity cast upon the former the burthen of
proving that the transaction was fairly conducted as if between
strangers.The courts of equity have refused to limit the relationships from which
the presumption of abuse of position or confidence might arise. The
doctrine of undue influence in equity also applies to situations
involving strangers outside any special relationship. For instance,
where a mortgagor of property has conveyed to a mortgagee and is infirm
and illiterate and has no independent legal advice “the onus of
justifying the transaction, and shewing that it was a right and fair
transaction, is thrown upon the mortgagee.” The noteworthy point about
the use of the phrase “not at arm’s length” in equity was that it
referred to a straight tug-of-war between one subject and another and
was not a three-way affair between two subjects and the state itself. The
purpose of equitable intervention into these transactions was to
prevent one subject from taking unfair advantage of another subject.
Where transactions were tainted with the suggestion of undue influence
the party on whom the onus was cast might bring in adequate evidence to
the contrary in order to support the transaction.[35]
Clearly, the arm’s length standard adopted in Section 27(d) means that
BSP personnel must transact with BSP-examined institutions in such a way
that they will not be able to utilize their position to gain undue
influence with, or more favorable terms from, the target institution.[36] In this case, there is prima facie
evidence of Jamorabo’s violation of the arm’s-length standard in his
dealing with RBKSI. RBKSI’s general manager, Nero, positively identified
Jamorabo as the prime mover behind the loan. Jamorabo approached Nero during RBKSI’s examination period and told the latter that he wanted to “avail for himself” a loan of P200,000.00.[37]
Since the amount was beyond Nero’s authority to approve, he accompanied
Jamorabo to meet with RBKSI’s president, Falgui, who wanted to deny the
loan application but was afraid to do so, for fear of offending
Jamorabo.[38] Jamorabo
personally filled out and signed the loan documents, but wrote in his
wife’s name as principal borrower. Jamorabo’s wife, the supposed
principal borrower, never went to RBKSI to personally process her
supposed application.[39] Nero
suggested that Jamorabo designate one of his co-examiners as a
co-maker, but Jamorabo flatly stated that his colleagues will not agree
to do so.[40] Jamorabo admits that he took out the loan during RBKSI’s examination period
but claims that his team had already finished the examination when he
approached Nero to inquire about availing a loan with RBKSI.[41]
Furthermore, the loan did not undergo the bank’s standard credit
investigation and security procedure, for it was not backed by real
security;[42] and was hastily
approved. Per Jamorabo’s narration, he approached Nero about taking out a
loan with RBKSI after the actual examination of RBKSI had ended on July
16, 2006,[43]and the loan was approved the next day, on July 17, 2006.[44]
Taken together, the timing and the circumstances surrounding the loan
transaction indicate that Jamorabo’s position as examiner-in-charge of
RBKSI unduly influenced the speedy facilitation thereof, in violation of
the arm’s-length principle.
of the express provision of Section 27(d) and BSP regulations. As
stated in the BSP’s complaint, it discovered the loan only in April
2009, during the succeeding periodic examination of RBKSI, after Nero
divulged the loan to the examiner-in-charge[45]
and to the Managing Director of the BSP’s Financial Accounting
Department, and after the spouses Jamorabo defaulted on the loan [46]
Tellingly, Jamorabo’s affidavit is completely silent on whether he
disclosed the loan to the BSP. His complete silence on the matter
betrays his awareness of the illegality of the transaction he entered
into with RBKSI. Had he disclosed the loan in any manner to his
superiors, he could have very easily said so in his affidavit; but he
did not, since he knew full well that the transaction was absolutely
prohibited under the then-prevailing law. The foregoing facts clearly
make out a prima facie case for violation of Section 27(d) in relation
to Section 36 of R.A. No. 7653 against Jamorabo; and the Ombudsman
committed grave abuse of discretion in ruling that Jamorabo cannot be
held criminally liable therefor.
Jamorabo can still be held
charge against him was filed after
retirement.
The BSP argues that Jamorabo can still be held administratively liable
for his loan transaction with RBKSI even if the complaint was filed
before the Ombudsman almost eight months after Jamorabo’s retirement
from government service. It cites the cases of Pagano v. Nazarro, Jr. [47] (Pagano), Baquerfo v. Sanchez[48] (Baquerfo), and Office of the Ombudsman v. Andutan[49] (Andutan)
in support of the proposition that “the crux of administrative
liability is not only the incumbency of a government official but also
that: first, the act complained of must have been done during one’s
stint in the government; and second, administrative sanctions, other
than dismissal, may still be meted out despite separation from service.”[50]
The BSP’s contentions have been passed upon and expressly rejected in one of the very cases it cited in support thereof. In Andutan the Court held:
To recall, we have held in the past that a public official’s
resignation does not render moot an administrative case that was filed
prior to the official’s resignation. In Pagano v. Nazarro, Jr., we held that:In Office of the Court Administrator v. Juan x x x,
this Court categorically ruled that the precipitate resignation of a
government employee charged with an offense punishable by dismissal from
the service does not render moot the administrative case against him.
Resignation is not a way out to evade administrative liability when
facing administrative sanction. The resignation of a public servant does
not preclude the finding of any administrative liability to which he or
she shall still be answerable x x x.Likewise, in Baquerfo v. Sanchez, we held:
Cessation from office of respondent by resignation x x x or
retirement x x x neither warrants the dismissal of the administrative
complaint filed against him while he was still in the service x x x nor
does it render said administrative case moot and academic x x x. The
jurisdiction that was this Court’s at the time of the filing of the
administrative complaint was not lost by the mere fact that the
respondent public official had ceased in office during the pendency of
his case x x x. Respondent’s resignation does not preclude the finding
of any administrative liability to which he shall still be answerable x x
x.However, the facts of those cases are not entirely applicable to the present case. In the above-cited cases, the
Court found that the public officials – subject of the administrative
cases – resigned, either to prevent the continuation of a case already
filed or to pre-empt the imminent filing of one. Here, neither situation
obtains.The Ombudsman’s general assertion that Andutan pre-empted the filing of a
case against him by resigning, since he “knew for certain that the
investigative and disciplinary arms of the State would eventually reach
him” is unfounded. First, Andutan’s resignation was neither his choice
nor of his own doing; he was forced to resign. Second, Andutan resigned
from his DOF post on July 1, 1998, while the administrative case was
filed on September 1, 1999, exactly one (1) year and two (2) months
after his resignation. The Court struggles to find reason in the
Ombudsman’s sweeping assertions in light of these facts.What is clear from the records is that Andutan was forced to resign more
than a year before the Ombudsman filed the administrative case against
him. Additionally, even if we were to accept the Ombudsman’s position
that Andutan foresaw the filing of the case against him, his forced
resignation negates the claim that he tried to prevent the filing of the
administrative case.Having established the inapplicability of prevailing jurisprudence, we
turn our attention to the provisions of Section VI of CSC Memorandum
Circular No. 38. We disagree with the Ombudsman’s interpretation
that “[a]s long as the breach of conduct was committed while the public
official or employee was still in the service x x x a public servant’s
resignation is not a bar to his administrative investigation,
prosecution and adjudication.” If we agree with this interpretation, any
official – even if he has been separated from the service for a long
time – may still be subject to the disciplinary authority of his
superiors, ad infinitum. We believe that this interpretation
is inconsistent with the principal motivation of the law – which is to
improve public service and to preserve the public’s faith and confidence
in the government, and not the punishment of the public official
concerned. Likewise, if the act committed by the public official is
indeed inimical to the interests of the State, other legal mechanisms
are available to redress the same.The possibility of imposing
accessory penalties does no
t
negate the Ombudsman’s
lack of jurisdiction.The Ombudsman suggests that although the issue of Andutan’s removal from
the service is moot, there is an “irresistible justification” to
“determine whether or not there remains penalties capable of imposition,
like bar from re-entering the public service and forfeiture of
benefits.” Otherwise stated, since accessory penalties may still be
imposed against Andutan, the administrative case itself is not moot and
may proceed despite the inapplicability of the principal penalty of
removal from office.We find several reasons that militate against this position.
First, although we have held that the resignation of an official
does not render an administrative case moot and academic because
accessory penalties may still be imposed, this holding must be read in
its proper context. In Pagano v. Nazarro, Jr., indeed, we held:A case becomes moot and academic only when there is no more
actual controversy between the parties or no useful purpose can be
served in passing upon the merits of the case x x x. The instant case is
not moot and academic, despite the petitioner’s separation from
government service. Even if the most severe of administrative sanctions –
that of separation from service – may no longer be imposed on the
petitioner, there are other penalties which may be imposed on her if she
is later found guilty of administrative offenses charged against her,
namely, the disqualification to hold any government office and the
forfeiture of benefits. x x xReading the quoted passage in a vacuum, one could be led to the
conclusion that the mere availability of accessory penalties justifies
the continuation of an administrative case. This is a misplaced reading
of the case and its ruling.Esther S. Pagano – who was serving as Cashier IV at the Office of the
Provincial Treasurer of Benguet – filed her certificate of candidacy for
councilor four days after the Provincial Treasurer directed her to
explain why no administrative case should be filed against her. The
directive arose from allegations that her accountabilities included a
cash shortage of P1,424,289.99. She filed her certificate of candidacy
under the pretext that since she was deemed ipso facto resigned from
office, she was no longer under the administrative jurisdiction of her
superiors. Thus, according to Pagano, the administrative complaint had
become moot.We rejected Pagano’s position on the principal ground “that the
precipitate resignation of a government employee charged with an offense
punishable by dismissal from the service does not render moot the
administrative case against him. Resignation is not a way out to evade
administrative liability when facing administrative sanction.” Our
position that accessory penalties are still imposable – thereby
negating the mootness of the administrative complaint – merely flows
from the fact that Pagano preempted the filing of the administrative
case against her. It was neither intended to be a stand-alone
argument nor would it have justified the continuation of the
administrative complaint if Pagano’s filing of candidacy/resignation did
not reek of irregularities. Our factual findings in Pagano confirm
this, viz.:At the time petitioner filed her certificate of candidacy,
petitioner was already notified by the Provincial Treasurer that she
needed to explain why no administrative charge should be filed against
her, after it discovered the cash shortage of P1,424,289.99 in her
accountabilities. Moreover, she had already filed her answer. To all
intents and purposes, the administrative proceedings had already been
commenced at the time she was considered separated from service through
her precipitate filing of her certificate of candidacy. Petitioner’s bad
faith was manifest when she filed it, fully knowing that administrative
proceedings were being instituted against her as part of the procedural
due process in laying the foundation for an administrative case. x x xPlainly, our justification for the continuation of the
administrative case – notwithstanding Pagano’s resignation – was her
“bad faith” in filing the certificate of candidacy, and not the availability of accessory penalties.[51]
As clearly illustrated by the foregoing passage, Andutan upholds
the general rule that the separation of a public officer from the
government service forecloses the filing of administrative charges
against such public officer.[52]
The continuing validity and binding effect of administrative
proceedings after the resignation or voluntary separation of the
respondent public officer is based not on the availability of accessory
penalties but on the bad faith attendant to such resignation or
voluntary separation. Contrary to the BSP’s assertion, Pagano and Baquerfo do not depart from these principles. In Pagano and Baquerfo
the administrative charges were filed before the erring public officers
resigned, and this Court held that their resignation did not serve as a
bar to the continuation of administrative proceedings against them,
since the jurisdiction of the administrative tribunal had already
attached even before the respondents were separated from the service.[53] In Andutan, the administrative case against Andutan was filed more than one year after his separation from the service; hence, the Court ruled that he can no longer be administratively charged.
However, the holding in Andutan is premised on the finding that
Andutan was involuntarily separated from the service by virtue of a
directive from the Executive Secretary.[54] Based on the aforequoted passage in Andutan,
separation from the service is not an absolute bar to the filing of an
administrative charge if the public officer voluntarily separated from
the service to “pre-empt the imminent filing” thereof.[55] That is precisely what happened in Office of the Court Administrator v. Juan,[56]
where the public officer tendered his resignation a day after
confessing to the commission of an administrative offense. The
administrative proceedings were formally initiated two months after he
tendered his resignation, which this Court did not accept, viz.:
The CZ Pistol was discovered missing during the hearing on 7
May 2003 in the criminal case for Parricide when the defense counsel
requested the production of the CZ Pistol. It was only on 19 May 2003
that respondent confessed that he took the CZ Pistol with its magazine
and cartridges. During the investigation on the missing CZ Pistol,
respondent failed to appear despite notices sent to him. Respondent’s
refusal to appear before the investigating judge, and his precipitate
resignation from the service, are clear indicia of guilt. Respondent’s
act of taking the CZ Pistol constitutes dishonesty and grave misconduct.Under Section 22, Rule IV of the Civil Service Rules, dishonesty and
grave misconduct are grave offenses punishable by dismissal from the
service even if it is the first offense. Respondents resignation
does not render the case moot. Resignation is not a way out to evade
administrative liability when a court personnel is facing administrative
sanction.[57]
In the present case, it is undisputed that Jamorabo voluntarily retired from government service effective December 31, 2008,[58] or a mere four (4) months before RBKSI’s next regular examination on April 2009.[59]
Having failed to fulfill his personal promise to RBKSI president Falgui
that the loan would be settled prior to the next regular examination of
RBKSI, Jamorabo suddenly separated himself from government service
before the said examination. Having been a bank examiner for 21 years,[60]
it is reasonable to presume that Jamorabo knew of RBKSI’s upcoming
regular examination, and that he was wise to the possibility of RBKSI
reporting the still unpaid loan to the BSP in the course thereof. This
is bolstered by the report of the BSP’s Investigation and Intelligence
Division finding that Jamorabo had started applying for a Canadian
Permanent Resident Visa as early as June 2008.[61]Given the suspicious timing and the circumstances surrounding his voluntary retirement from the service, coupled with his actual departure from the Philippines in April 2010,[62] barely four months after the loan was finally settled by his wife and sister-in-law,[63]
this Court finds that Jamorabo’s voluntary separation from government
service was calculated to pre-empt the charges that will inevitably
result from the discovery of the illicit loan he entered into. As it
turned out, RBKSI did report the loan to the BSP in the very next
examination period; and the complaint against Jamorabo was filed shortly
thereafter. All told, the Ombudsman committed grave abuse of discretion
in ruling that Jamorabo could no longer be held administratively
liable. Likewise, the Ombudsman also committed grave abuse of discretion
when it docketed Jamorabo’s case as a purely criminal investigation,
without pursuing the administrative aspect thereof. The Ombudsman must
therefore proceed with the determination of Jamorabo’s administrative
liability for violation of the Central Bank Act and other pertinent
government regulations in connection with the loan he contracted with
RBKSI.
There is no prima facie case for
violation of R.A. No. 3019, Section
3(e)
of public officers which are outlawed and penalized by said law.
Paragraph (e) of said provision embraces two different acts: “causing
any undue injury to any party”, and “giving any private party any
unwarranted benefits, advantage or preference in the discharge of his
official administrative or judicial functions through manifest
partiality, evident bad faith or gross inexcusable negligence.”
Jurisprudence treats these two different acts as two different modes of
committing the same offense; therefore, an accused violates Section 3(e)
by committing either one or both of the said acts.[64]
In the case at bar, the Ombudsman correctly found that Jamorabo could
not be held liable for violating Section 3(e) through the first mode
because the loan had been paid in full. Well settled is the rule that in
a prosecution for violation of Section 3(e) through causing undue
injury, proof of actual injury or damage must be shown.[65] Contrary to the BSP’s position,[66] “undue injury in Sec. 3(e) cannot be presumed even after a wrong or a violation of a right has been established ,”[67]
While Jamorabo’s loan is indeed a violation of R.A. No. 7653, the BSP
was unable to show how such violation caused actual damage or injury to
any party, much less to RBKSI.
The BSP argues that Jamorabo should still be charged with violating
Section 3(e) through the second mode. It argues that Jamorabo’s loan
arrangement with RBKSI conferred the latter with the unwarranted benefit
of escaping BSP detection and sanction for the unauthorized loan,
specifically by deliberately designating his wife as the principal
borrower and scheduling the loan payments before the next scheduled
regular examination of RBKSI.[68] On this point, We approvingly cite the Ombudsman’s findings:
As for the alleged giving of unwarranted benefits to the
bank, this Office finds the same unmeritorious. There was no showing of
any concrete benefit given to the Rural Bank of Kiamba, Inc. at the time
respondent’s loan was granted. The bank officers’ silence or inaction
over the matter resulting in the non-discovery of the loan, cannot be
considered an unwarranted benefit but rather an irregular act or lapse
of judgment on their part.[69]
It bears repeating that both Nero and Falgui – who were the general
manager and the president of RBKSI, respectively – objected to
Jamorabo’s loan application.[70] As alleged in Nero’s affidavit, Falgui only approved the loan out of fear of offending Jamorabo.[71]
Furthermore, RBKSI did not really gain the benefit of escaping
detection since it reported the loan to the BSP in the course of its
next regular examination.
9, 2011 Resolution and the July 28, 2011 Order of the Office of the
Ombudsman in Case No. OMB-C-C-09-0465-I are hereby REVERSED and SET ASIDE
insofar as these absolved respondent Benjamin M. Jamorabo of criminal
and administrative liability for violation of Section 27(d) in relation
to Section 36 of Republic Act No. 7653. The Office of the Ombudsman is
hereby ORDERED to: 1) FILE before the proper court the
necessary information for violation of Section 27(d) in relation to
Section 36 of Republic Act No. 7653, as amended, against Benjamin M.
Jamorabo; and 2) INITIATE administrative proceedings against Benjamin M. Jamorabo in accordance with this Decision.
Gesmundo, C.J., Caguioa, Carandang, and Zalameda, JJ., concur.
* Also referred to in the records as Benjamin Daniel M. Jamorabo, Rollo, p. 168.
[1] Id. at 3-35.
[2] Id. at 38-45; prepared by
Graft Investigation and Prosecution Officer II Alteza A. Añoso, reviewed
by Graft Investigation and Prosecution Officer III Aleu A. Amante, and
approved by Ombudsman Ma. Merceditas N. Gutierrez, with the favorable
recommendation of Acting Assistant Ombudsman Mary Susan S. Guillermo.
[3] Id. at 47-50A; prepared by
Graft Investigation and Prosecution Officer II Alteza A. Añoso,
reviewed by Director Moreno F. Generoso, and approved by Overall Deputy
Ombudsman Orlando C. Casimiro, with the favorable recommendation of
Assistant Ombudsman Aleu A. Amante.
[7] Id. at 53-54.
[9] Order dated November 17, 2009, id. at 81-82.
[10] Id. at 13, 83-88.
[11] Id. at 11, 84.
[12] Resolution dated February 9, 2011, id. at 43.
[13] Id. at 43-44.
[14] Id. at 44.
[16] Id. at 2.
[18] Id. at 112-124.
Security, Investigation, and Transport Department dated June 25, 2013,
id. at 166; Certification from the Bureau of Immigration dated June 20,
2013, id, at 167; Resolution dated November 13, 2013, id. at 173.
[21] Beltran v. Sandiganbayan, G.R. No. 201117, January 22, 2020; Morales v. Ombudsman Carpio Morales, et al., 791 Phil. 539, 553 (2016).
[22] Presidential Commission on Good Government v. Gutierrez, G.R. No. 193398, June 3, 2019; Presidential Commission on Good Government v. Navarro-Gutierrez, et al., 772 Phil. 91, 100 (2015); Presidential Ad Hoc Fact-Finding Committee on Behest Loans, et al. v. Hon. Desierto, et al., 664 Phil. 16, 20 (2011); Brito v. Ombudsman for Luzon, 554 Phil. 112 (2007); Esquivel v. Hon. Ombudsman, 437 Phil. 702, 713-714 (2002); Posadas v. Ombudsman, 395 Phil. 601 (2000); Garcia-Rueda v. Pascasio, 344 Phil. 323,326-327 (1997); Camanag v. Guerrero, 335 Phil. 945 (1997); Ocampo IV v. Ombudsman, 296-A Phil. 770, 775 (1993).
acts of the Legislature which prohibit certain acts and establish
penalties for their violations; or those that define crimes, treat of
their nature, and provide for their punishment,” Inmates of the New Bilibid Prison, Muntinlupa City v. De Lima, G.R. No. 212719, June 25, 2019; Hernandez v. Albano, 125 Phil. 513, 520-521 (1967); Lorenzo v. Posadas, 64 Phil. 353 (1937).
[25] Rollo, pp. 75-77.
paragraph A of the Uniform Rules on Administrative Cases in the Civil
Service (URACCS) grave misconduct is a ground for dismissal from the
civil service. In turn, grave misconduct is “the transgression of some established and definite rule of action, more particularly, unlawful behavior or gross negligence by a public officer coupled with the elements of corruption, willful intent to violate the law or to disregard established rules.” Fajardo v. Corral,
G.R. No. 212641, July 5, 2017. Furthermore, Jamorabo’s act of taking
out a loan with a bank under his examination also violates Section 50,
paragraph A, no. 9 of the URACCS (contracting loans from persons with
whom the employee’s office has business relations).
[29] A co-maker is “[o]ne who
participates jointly in borrowing money on a promissory note; esp., one
who acts as surety under a note if the maker defaults.” Black’s Law
Dictionary (9th ed.) 302 (2009)
[30] Affidavit of Benjamin Magdato Jamorabo, Rollo,
p. 83. February 9, 2011 Resolution, id. at 43-44; Promissory note and
Co-maker’s statement signed by Benjamin M. Jamorabo, id. at 64-65.
[31] REVISED PENAL CODE, Article 22 states: Retroactive effect of penal laws.
— Penal laws shall have a retroactive effect insofar as they favor the
persons guilty of a felony, who is not a habitual criminal, as this term
is defined in Rule 5 of Article 62 of this Code, although at the time
of the publication of such Saws a final sentence has been pronounced and
the convict is serving the same. See People v. Parel, 44 Phil. 437, 438 (1923); People v. Moran, 44 Phil. 387, 395 (1923); United States v. Parrone, 24 Phil. 29, 32 (1913).
[32] Black’s Law Dictionary (9th ed.) 1635 (2009).
[35] Walter C. Newman, Legal Use of the “Arm’s Length” Concept, 11 U. TORONTO L.J. (No. 1) 139 (1955). Citations omitted, underscoring supplied.
[36] See 2018 Manual of Regulations for Banks, Sec. X136(3).
affidavit, Jamorabo alleged that his wife was able to sign on the
borrower fields of the loan forms. Affidavit of Benjamin Magdato
Jamorabo, id. at 84.
[42] When Nero told Jamorabo
that RBKSI requires large loans to be secured by real property, Jamorabo
convinced Nero to accept his offer of issuing post-dated checks,
Affidavit of William Nero y Campos, id. at 56.
[43] Affidavit of Benjamin Magdato Jamorabo, id. at 83
[44] Rollo, pp. 60-61, 66-67.
[45] Id. at 54.
[46] Id. at 74.
[47] 560 Phil. 96 (2007).
[50] Rollo, p. 21.
supra note 49 at 183-188. Citations, original emphases and original
underscoring omitted; new emphases, italics and underscoring supplied.
[54] Office of the Ombudsman v. Andutan, supra note 49 at 173, 184-185.
[55] Id. at 184.
[56] 478 Phil. 823 (2004).
[58] Rollo, pp. 25, 84.
[59] Id. at 25.
[60] Id. at 25, 83.
[61] Id. 166-168.
[63] According to Marites and
Honeyve, the loan was fully paid on December 1, 2009. Affidavits of
Marites Bonsobre Jamorabo and Honeyve B. Montecalvo, id. at 85-88.
[64] Tupaz v. Office of the Deputy Ombudsman for the Visayas, G.R. No. 212491-92, March 6, 2019; Valencerina v. People, 749 Phil. 886, 890-891 (2014); Ampil v. Office of the Ombudsman, et al., 715 Phil. 733, 758-759 (2013); Sison v. People, 628 Phil. 573, 584-585 (2010); Republic of the Philippines v. Hon. Desierto, 516 Phil. 509, 513-514 (2006).
p. 28), the BSP asserts that Jamorabo’s violation of the prohibition of
borrowings by BSP examiners constitutes, by itself, undue injury to the
government.
[67] Llorente, Jr. v. Sandiganbayan, supra at 837-838.
[70] Affidavit of William Nero y Campos, id. at 56.