LEGAL OPINION 5-2014

LEGAL BASIS FOR FILING QUALIFIED THEFT AGAINST BANK EMPLOYEES THAT MISAPPROPRIATE THE
FUNDS OF THE BANK

 In order to determine the appropriate criminal case to be filed against the bank employees,
determination of the ownership of the money misappropriated by said employees must first be
established.

OWNERSHIP OF MONEY DEPOSITED BY CLIENTS

The bank’s relationship with its depositor is not a trustor-trustee relationship. In the case of a
cash deposit, an amount is delivered to the bank by the depositor, not as a trustor but as a creditor.
Their relationship is governed by the New Civil Code provisions on simple loan as expressly stipulated in
Art. 1980, to wit:

Art. 1980. Fixed, savings and current deposits of money in banks and similar
institutions shall be governed by the provisions concerning simple loans.

In a simple loan, the debtor (in this case the bank) becomes the owner of the cash that was
deposited subject to the obligation to pay the depositor.

Art. 1953. A person who receives a loan of money or any other fungible thing acquires
the ownership thereof, and is bound to pay to the creditor an equal amount of the same in kind
and quality.

As a debtor, the bank has no duty to preserve the amount deposited. Since the contract is
governed by the rules on simple loan and not the contract of deposit, the money received by the bank is
not being held for safekeeping for the depositor. Money so deposited belongs to the bank and may be
used for any lawful purpose as it may deem fit. It follows then, the bank as owner of the money can use
the money deposited for its own personal benefit. In fact, banks are expected to use the amount
deposited for lending or investing in its own name.

Money that flows into banks becomes part of the generic fund and that money paid out by the
bank flows, again, from the bank itself and not from the individual pool of money maintained by the
customer. In other words, the reservoir is that of the bank, not reservoir comprising earmarked amounts
owned by separate account holders.

Consistent with the existence of the debtor-creditor relationship, the following rules were laid down
in pertinent jurisprudence:

1. The bank can make use as its own the money deposited. Said amount is not being held in trust
for the depositor nor is it being kept for safekeeping (Tan Tiong Tick vs. American Apothecaries,
65 Phil. 414, 1938).
2. The officers of the bank cannot be held liable for estafa if they authorized the use of the money
deposited by the depositor. There would be no liability for estafa under Article 315(1)(b) of the
Revised Penal Code even if the bank failed to return the amount deposited. The money that is
 LEGAL OPINION 5-2014

deposited is not held in trust by the bank (Guingona vs. City Fiscal of Manila, 128 SCRA 577,
1984).

(Source: Banking Law and Negotiable Instruments Law by Aquino, 2010)

CONCLUSION : BANK OWNS THE MONEY STOLEN BY THE BANK EMPLOYEES

Having established that the money stolen by the tellers is indeed owned by the bank, the
elements for the crime of qualified theft are then satisfied as shown below:

Elements of the crime of qualified theft
1. Taking of personal property;
2. That the said property belongs to another;
3. That the said taking be done with intent to
gain;
4. That it be done without the owner’s
consent;
5. That it be accomplished without the use of
violence or intimidation against persons, nor
of force upon things; and
6. That it be done with grave abuse of
confidence.
Acts of the tellers constituting the elements
of the crime of qualified theft
1. The tellers took the money of the
bank
2. The money taken by the tellers
belongs to the Bank (Art. 1953 in
relation to Art.1980 of the Civil Code)
3. Intent to gain can be presumed from
the unlawful taking done by the tellers
and their failure to produce said
money upon demand of the Bank for
them to return such
4. The unauthorized withdrawals done
without the requisite withdrawal slips,
valid Debit/Credit Memo and deposits
made to fictitious accounts or relatives’
accounts shows clearly the lack of
consent from Bank.
5. The tellers were able to take the
money of the bank by manipulating the
procedures and protocols for
withdrawals, use of credit/debit
memos and call-backing. All acts done
without the use of violence or
intimidation nor force upon things.
6. Chu and Bughao being tellers of the
Bank, necessarily come into possession
of the monies deposited to the bank by
virtue of the trust and confidence
reposed to them by the Bank.

In qualified theft, the real offended party is the bank since it was the latter’s personal property
that was stolen. It is possible therefore that the bank could choose not to involve the depositors as this
criminal issue is purely between the state, with the bank as the complaining witness, and erring bank
employee as the defendant.

JURISPRUDENCE CONVICTING BANK EMPLOYEES OF QUALIFIED THEFT:

PP V. RUBEN SISON, GR NO. 12383, JANUARY 19, 2000

Facts:
 LEGAL OPINION 5-2014

Ruben Sison, the Branch Operations Officer facilitated the crediting of two (2) fictitious
remittances in the amounts of P3,250,000 and P4755,000 in favor of Solid Realty Development
Corporation, an equally fictitious account and the later the withdrawal of P6,000,000 from the Philippine
Commercial International Bank (PCIB) Luneta Branch.

The accused was able to perform all these transactions by manipulating bank processes and
taking advantage of his position as BOO. He reactivated the dormant account of Solid Electronics, Inc.
and changed its account name to Solid Realty Development Corporation. He then prepared debit and
credit tickets making it appear that PCIB Cabacan Branch, North Cotabato sent a telegraphic fund
transfer in favor of Solid Realty Development Corporation. After the money was credited to the
fictitious account, the accused then made a back office withdrawal wherein he made it appear that the
fictitious client authorized him to make such withdrawal.

In this case the bank filed a case for estafa but the Office of the City Prosecutor of Manila issued
a Resolution recommending that appellant be charged with qualified theft, not estafa, considering that
as BOO, accused had full control of and unimpeded access to the bank vault.

Held:

The accused, Ruben Sison, was held guilty of qualified theft based on the following
circumstantial evidence which was sufficiently established by the prosecution:

1. With any request from the listed depositor, the said account was revived and restored to active
status under the same savings account number but under different account name. The only
personnel of the PCI Bank in its Luneta Branch who could have effected the change and had
motive was the accused.
2. There was no record of the telegraphic transfer of remittance of fund from Kabacan Branch as
attested to by the Kabacan Branch Manager.
3. The 2 fictitious telegraphic transfers received in the Luneta Branch were tested, approved and
encoded by the accused.
4. The accused was able to acquire possession of the two keys needed to open the bank vault by
relieving the cashier who had custody of the other key.
5. The accused acted beyond the scope of his authority, without knowledge and consent of the
bank and through the process of simulated bank office withdrawals, the accused withdrew from
the cash vault using the passbook of the revived dormant account under the fictitious name of
Solid Realty Development Corporation.

It is of particular importance to emphasize that in this case, there was no bank depositor
presented as a witness since the account manipulated by the bank employee is fictitious. There
was no bank depositor injured by the felonious acts done by the accused.

PP VS. TERESITA PUIG AND ROMEO PORRAS, GR NO. 173654-765, AUGUST 28, 2008

Facts:

Two informations for qualified theft were filed against Teresita Puig and Romeo Porras, the
cashier and bookkeeper, respectively, of Rural Bank of Pototan, Inc.

The trial court dismissed the case on the following grounds:

(1) the element of ‘taking without the consent of the owners’ was missing on the ground that
it is the depositors-clients, and not the Bank, which filed the complaint in these cases, who are
 LEGAL OPINION 5-2014

the owners of the money allegedly taken by respondents and hence, are the real parties-in-
interest; and

xxx

Held:

The SC reversed and set aside the order of dismissal by the trial court.

To fall under the crime of Qualified Theft, the following elements must concur:

1. Taking of personal property;

2. That the said property belongs to another;

3. That the said taking be done with intent to gain;

4. That it be done without the owner’s consent;

5. That it be accomplished without the use of violence or intimidation against persons, nor of
force upon things;

6. That it be done with grave abuse of confidence.

It is beyond doubt that tellers, Cashiers, Bookkeepers and other employees of a Bank who come
into possession of the monies deposited therein enjoy the confidence reposed in them by their
employer. Banks, on the other hand, where monies are deposited, are considered the owners thereof.
This is very clear not only from the express provisions of the law, but from established jurisprudence.
The relationship between banks and depositors has been held to be that of creditor and debtor. Articles
1953 and 1980 of the New Civil Code, as appropriately pointed out by petitioner, provide as follows:

Article 1953. A person who receives a loan of money or any other fungible thing acquires the
ownership thereof, and is bound to pay to the creditor an equal amount of the same kind and quality.

Article 1980. Fixed, savings, and current deposits of money in banks and similar institutions shall
be governed by the provisions concerning loan.

In a long line of cases involving Qualified Theft, this Court has firmly established the nature of
possession by the Bank of the money deposits therein, and the duties being performed by its employees
who have custody of the money or have come into possession of it. The Court has consistently
considered the allegations in the Information that such employees acted with grave abuse of
confidence, to the damage and prejudice of the Bank, without particularly referring to it as owner of the
money deposits, as sufficient to make out a case of Qualified Theft. For a graphic illustration, we cite
Roque v. People,[6] where the accused teller was convicted for Qualified Theft based on this
Information:

That on or about the 16th day of November, 1989, in the municipality of Floridablanca, province
of Pampanga, Philippines and within the jurisdiction of his Honorable Court, the above-named accused
ASUNCION GALANG ROQUE, being then employed as teller of the Basa Air Base Savings and Loan
Association Inc. (BABSLA) with office address at Basa Air Base, Floridablanca, Pampanga, and as such
was authorized and reposed with the responsibility to receive and collect capital contributions from its
member/contributors of said corporation, and having collected and received in her capacity as teller of
the BABSLA the sum of TEN THOUSAND PESOS (P10,000.00), said accused, with intent of gain, with
grave abuse of confidence and without the knowledge and consent of said corporation, did then and
 LEGAL OPINION 5-2014

there willfully, unlawfully and feloniously take, steal and carry away the amount of P10,000.00,
Philippine currency, by making it appear that a certain depositor by the name of Antonio Salazar
withdrew from his Savings Account No. 1359, when in truth and in fact said Antonio Salazar did not
withdraw the said amount of P10,000.00 to the damage and prejudice of BABSLA in the total amount of
P10,000.00, Philippine currency.

In convicting the therein appellant, the Court held that:

Since the teller occupies a position of confidence, and the bank places money in the teller’s
possession due to the confidence reposed on the teller, the felony of qualified theft would be
committed.

Also in People v. Sison, the Branch Operations Officer was convicted of the crime of Qualified
Theft based on the Information as herein cited:

That in or about and during the period compressed between January 24, 1992 and February 13,
1992, both dates inclusive, in the City of Manila, Philippines, the said accused did then and there wilfully,
unlawfully and feloniously, with intent of gain and without the knowledge and consent of the owner
thereof, take, steal and carry away the following, to wit:

Cash money amounting to P6,000,000.00 in different denominations belonging to the

PHILIPPINE COMMERCIAL INTERNATIONAL BANK (PCIBank for brevity), Luneta Branch, Manila
represented by its Branch Manager, HELEN U. FARGAS, to the damage and prejudice of the said owner
in the aforesaid amount of P6,000,000.00, Philippine Currency.

That in the commission of the said offense, herein accused acted with grave abuse of
confidence and unfaithfulness, he being the Branch Operation Officer of the said complainant and as
such he had free access to the place where the said amount of money was kept.

The judgment of conviction elaborated thus:

The crime perpetuated by appellant against his employer, the Philippine Commercial and
Industrial Bank (PCIB), is Qualified Theft. Appellant could not have committed the crime had he not
been holding the position of Luneta Branch Operation Officer which gave him not only sole access to the
bank vault xxx. The management of the PCIB reposed its trust and confidence in the appellant as its
Luneta Branch Operation Officer, and it was this trust and confidence which he exploited to enrich
himself to the damage and prejudice of PCIB x x x.

From another end, People v. Locson, in addition to People v. Sison, described the nature of
possession by the Bank. The money in this case was in the possession of the defendant as receiving
teller of the bank, and the possession of the defendant was the possession of the Bank. The Court held
therein that when the defendant, with grave abuse of confidence, removed the money and
appropriated it to his own use without the consent of the Bank, there was taking as contemplated in the
crime of Qualified Theft.

Conspicuously, in all of the foregoing cases, where the Informations merely alleged the positions
of the respondents; that the crime was committed with grave abuse of confidence, with intent to gain
and without the knowledge and consent of the Bank, without necessarily stating the phrase being
assiduously insisted upon by respondents, “of a relation by reason of dependence, guardianship or
vigilance, between the respondents and the offended party that has created a high degree of confidence
between them, which respondents abused,” and without employing the word “owner” in lieu of the
“Bank” were considered to have satisfied the test of sufficiency of allegations.

As regards the respondents who were employed as Cashier and Bookkeeper of the Bank in this
case, there is even no reason to quibble on the allegation in the Informations that they acted with grave
 LEGAL OPINION 5-2014

abuse of confidence. In fact, the Information which alleged grave abuse of confidence by accused
herein is even more precise, as this is exactly the requirement of the law in qualifying the crime of Theft.

In summary, the Bank acquires ownership of the money deposited by its clients; and the
employees of the Bank, who are entrusted with the possession of money of the Bank due to the
confidence reposed in them, occupy positions of confidence. The Informations, therefore, sufficiently
allege all the essential elements constituting the crime of Qualified Theft.

CLAIRE MARIE B. MAURO