ELISEO R. FRANCISCO, JR., PETITIONER, VS. PEOPLE OF THE PHILIPPINES, RESPONDENT.

Francisco versus People of the Philippines

The Case

This is the case of Francisco versus People of the Philippines, decided by the Supreme Court in February 2009. Eliseo Francisco, Junior, a former employee of the credit card company Bankard, was convicted of estafa under the Revised Penal Code for causing fictitious credits to be posted to his own credit card accounts. He asks the Supreme Court to overturn his conviction, insisting that one element of estafa is missing — that Bankard was not the party he intended to defraud, and that Bankard was not even the proper complainant. The case matters because it settles two questions every reviewee must know: who must rely on the deceit in estafa, and who may file the criminal complaint.

Procedural History

Francisco was charged with estafa in an amended information filed with the Regional Trial Court of Pasig City. On arraignment he pleaded not guilty, and trial followed. The trial court convicted him and sentenced him to an indeterminate penalty, ordering him to reimburse Bankard the amount of 18,430.21 pesos. Francisco moved for reconsideration and new trial, arguing that Bankard was not the entity that suffered damage, but the trial court denied the motion.

Francisco then went up to the Court of Appeals, which affirmed the conviction but modified the prison sentence to an indeterminate penalty of four years and two months of prision correccional as the minimum, to twenty years of reclusion temporal as the maximum. Francisco then filed a petition for review on certiorari under Rule 45 of the Rules of Court before the Supreme Court.

Facts

Bankard was engaged in issuing credit cards and in acquiring credit card receivables from commercial establishments. Francisco was its Acquiring Chargeback Supervisor, skilled in computer programming. Bankard engaged Equitable Computer Services, Incorporated, called Equicom, to encode and post credit card transactions and to send reports by electronic mail. Francisco alone was tasked to convert those reports into the format used by Bankard.

In August 1999, Solidbank relayed to Bankard that there were four questionable transactions in a Mastercard account under Francisco's name, with 663,144.56 pesos apparently credited to it as a reversal of charges from four establishments. Another 18,430.21 pesos was credited to his AIG Visa card as a supposed credit advance. Investigation showed that in Equicom's original reports, a reversal of charges from Bankard Travel Services in the amount of 5,989.60 dollars was credited to Francisco's card, but in the converted report that credit was deleted and replaced with zero. There were no original purchases on his cards that could be reversed, so the credits were fictitious.

Because of the fraudulent crediting, Bankard was made to pay Solidbank the amount in the settlement of transactions between issuing banks, and it could not use that sum for at least three months. Bankard also could not recover the 18,430.21 pesos credited to the AIG Visa card. Francisco denied causing the credits, and the trial court convicted him.

Issues

• Whether or not the third element of estafa, that the offended party relied on the false pretense or fraudulent means, is absent because the deceit was not intentionally directed at Bankard.
• Whether or not Bankard had the personality to file the complaint, given that the credit card companies were the parties said to have suffered damage.
• Whether or not the Court of Appeals correctly modified the penalty imposed on Francisco.

Applicable Provisions

Article 315, paragraph 2, subparagraph a of the Revised Penal Code, as quoted in the decision, provides:

By means of any of the following false pretenses or fraudulent acts executed prior to or simultaneously with the commission of the fraud: (a) By using fictitious name, or falsely pretending to possess power, influence, qualifications, property, credit, agency, business or imaginary transactions, or by means of other similar deceits.

This is the very mode of estafa charged against Francisco, and the Court measures his acts against its language.

Article 315 of the Revised Penal Code, also quoted in the decision, fixes the penalty:

The penalty of prision correccional in its maximum period to prision mayor in its minimum period, if the amount of the fraud is over 12,000 pesos but does not exceed 22,000 pesos, and if such amount exceeds the latter sum, the penalty provided in this paragraph shall be imposed in its maximum period, adding one year for each additional 10,000 pesos; but the total penalty which may be imposed shall not exceed twenty years.

This provision governs the computation of the maximum term of the indeterminate sentence.

Article 4 of the Revised Penal Code, quoted in the decision, provides:

Criminal liability shall be incurred: 1. By any person committing a felony (delito) although the wrongful act done be different from that which he intended.

This is the basis for holding Francisco liable although the consequences of his felonious act were not intended by him.

Ruling

On the first issue, the Court held that the third element of estafa merely requires that the offended party relied on the false pretense, fraudulent act, or fraudulent means. It does not require that the deceit be intentionally directed to the offended party. Where a person pretends to possess credit in order to defraud third persons, but the offended party nevertheless relies on the fraudulent means and suffers damage, that person is liable for estafa. A person committing a felony is criminally liable although the consequences of his felonious act are not intended by him. In any case, the prosecution proved that Bankard itself suffered damage.

On the second issue, the Court held that, except in cases that cannot be prosecuted de oficio, a complaint by the offended party is not necessary to institute a criminal action; the information filed by the prosecutor is sufficient. A crime is an offense against the State and is prosecuted in the name of the People of the Philippines.

On the third issue, the Court held that the Court of Appeals correctly modified the penalty. The minimum term must be one degree lower than the prescribed penalty, which is prision correccional in its minimum to medium period, or six months and one day to four years and two months; the imposed minimum of four years and two months falls within that range. The total amount defrauded, 681,574.77 pesos, exceeds 22,000 pesos by 659,547.77 pesos, or sixty-five additional ten thousand peso units, which would add sixty-five years but for the twenty-year ceiling. The maximum term was therefore properly pegged at twenty years.

Doctrine

First, in estafa under Article 315, paragraph 2, subparagraph a, the deceit need not be intentionally directed at the offended party; it is enough that the offended party relied on the fraudulent means and suffered damage. Second, criminal liability attaches under Article 4 of the Revised Penal Code even when the wrongful act done is different from that which the offender intended. Third, a criminal action is prosecuted in the name of the People, and the information filed by the prosecutor suffices; a complaint by the offended party is required only in offenses that cannot be prosecuted de oficio. Fourth, the penalty for estafa is computed under Article 315, adding one year for each additional 10,000 pesos beyond 22,000 pesos, subject to a maximum of twenty years.

Disposition

The Supreme Court affirmed the decision and resolution of the Court of Appeals, with costs against Francisco.

Remember This

Memorize this line: the deceit in estafa need not be directed at the offended party, so long as that party relied on it and suffered damage. Examiners use this case to test the third element of estafa and the rule that a criminal action is prosecuted in the name of the People, not of the private complainant.